The SaaS market has exploded in recent years; the number of SaaS apps an organization is using has grown from 8 in 2015 to 110 in 2021.
This is a testament to the growing popularity of SaaS companies. Name any niche, and you’ll find a tool for it.
In such a competitive scenario, you can’t fire arrows and “wish” they hit the mark. You need to be certain of the strategies you’re implementing and the results they will bring.
Enter the hero of our story: competitive analysis.
As a SaaS SEO agency, we regularly conduct SaaS competitive analysis for our clients. Here’s how we do it (and how you can too).
What We'll Cover:
What is SaaS Competitive Analysis?
A SaaS competitive analysis is the process of researching and analyzing how your company or product stacks up against your competitors.
It helps SaaS companies find out who their competitors are, their strategies, their campaigns, and the practices they follow. Armed with this information, you can identify gaps and capitalize on them.
Generally, SaaS competitive analysis only covers direct competitors. But it’s always a good practice to find indirect competitors that might not currently threaten your brand but could become competitors.
Benefits of Conducting SaaS Competitive Analysis
The six key reasons you should conduct a competitive analysis are:
Helps Build Your Unique Value Proposition (USP)
What if a potential customer comes up to you and asks, “How is tool XYZ different from yours? They are offering the same solution at a lower price.”
If you have conducted a comprehensive competitor analysis, your team would have a convincing answer prepared. For example, you can point out factors like user experience or the specific workings of certain features and how that’s better in your tool than in your competitors.
Many SaaS businesses also create unique landing pages to describe their USP.
Stay Relevant in the Market
You might be using age-old strategies that bring results.
But what if better methods to increase conversions exist, and your competitors are already using them?
You can find out what is working in your industry by conducting a competitive analysis regularly. This helps you stay up-to-date with the current trends and gain a competitive advantage.
For example, if you have a social media management tool and find out that your competitors have created content around a recent social media update, you can discover the gaps in that content and produce a better article.
Keeping Ahead of the Competition
No matter how big or small your competitor is, they might be lacking on some fronts.
For example, they could have an inconsistent content schedule, or their website content may seem dull or monotonous.
By tracking this, you can take advantage of the weaknesses and provide your target audience with what they might not get if they subscribe to your competitor’s tool.
Identify Potential Opportunities
You don’t want to rehash the same content your competitor is producing or have the same features your competitor’s tool provides.
The only way to provide something new to your customer is by taking a step back from your product and analyzing your competitor’s product.
This way, you can unearth potential opportunities to improve your product and the marketing strategies and campaigns you’re currently running.
Develop New Strategies to Sell Better
If you’re a SaaS startup or a company that has recently started experimenting with different strategies, running a competitive analysis can help you narrow down those strategies that would bring you the best results.
You can even discover new strategies that help increase conversions and sales.
Learn Customer’s Needs
You already know your customer.
But their needs and requirements keep evolving with time.
To get a deeper understanding, go through the product reviews for your competitor’s tool. These words, directly from your customer, provide vital insight and information. It helps you find what’s missing in their tool and what customers like best.
Based on that, you can improvise your products.
How to Conduct SaaS Competitor Analysis?
Here’s how you can conduct a SaaS competitor analysis:
Step 1. Determine Your Top Competitors
To analyze your competitors, you must first discover who they are.
There are two ways to find them:
- Use search engines: Head to Google and type the main keywords for your niche. For example, “project management tool.” You’ll find many of those tools on the first SERP, along with listicles like “best project management tools.”
- Use SaaS review websites: By searching for your niche on review websites like G2, Capterra, and TrustRadius, you can discover many competitors you otherwise would have missed.
Step 2. Research their Products and Services
The product holds the most importance for any SaaS business.
As you delve deep into competitive analysis, discover more about their tool's different features and functionalities.
Also, ask yourself questions like, “Is their interface user-friendly?” “Can a layman know how to use their tool without tutorials or demos?” “Are there any bugs, or does the tool experience downtimes?”
This will help you create a clear picture of how your tool differs from theirs and the benefits of picking your tool against your competitor’s.
Step 3. Analyze Their Marketing Strategies
Here are four key parts of their marketing strategies you should analyze:
Target Keywords
Once you have listed your competitors for this analysis, head over to tools such as Ahrefs that let you narrow down the keywords your competitors are targeting.
You can even conduct a keyword gap analysis to discover those keywords that your competitors are ranking for, but you don’t.
To do this, go to the Site Explorer Tool on Ahrefs.
Enter your competitor’s site.
Use filters such as keyword difficulty, traffic, position, and volume to find high-quality keywords that are likely to convert.
Backlinking Gap Analysis
Backlinks are a crucial part of any SEO strategy.
They tell search engines how authoritative your website is. The more quality backlinks you have, the higher your authority score and the more visibility you get on search engines.
You can use tools like Ahrefs to find your competitor's backlink profile to find out the gaps.
Once this is done, you can see the kind of websites linking back to similar tools like yours and if your competitors are missing out on valuable backlink opportunities.
Content Marketing
Most SaaS companies have discovered that when used strategically, content marketing can bring a lot of leads and conversions for the business.
To ensure your content strategy is one step ahead of your competitor, check their posts that get a lot of traffic and those ranking high on SERPs. Find out what unique things they bring and how they introduce their tool in the articles.
Pay attention to minute details like CTAs, the content’s tone, the kind of examples they quote, the content formats they generally use, etc.
User Experience
Have you ever visited a site that loaded very slowly? Or a site where you didn’t know how to find what you wanted?
What did you do next?
Probably switch to a competitor’s site.
When this happens often, this signals to the search engines that there are some problems with the site. To ensure your site provides a high level of user experience, create a proper navigation structure and design for fast speed and accessibility across devices.
Look at how Trello has put up a search button on its blog. This helps readers find what they want easily and improves the overall user experience.
Step 4. Check Customer Interactions, Reviews, and Feedback
How is your competitor interacting with their customers on social media?
How do they respond to negative reviews on third-party sites?
Do they have a platform where users can leave suggestions and feature improvements?
Finding out the answers to these questions can bring forth a lot of unique insights. For example, if you find out that your competitor’s customers don’t like their UI, you can dig deep into why and whether your UI has the same mistakes.
Step 5. Compare and Evaluate Gaps
After performing the above steps, you’ll have a fair idea of your competitors' strategies and campaigns.
Compare these with your own and find out the gaps.
You can create a document like the one below and note the gaps for each component, like content marketing, SEO, email marketing, pricing strategy, etc.
To take it a step further, also mention how you are deciding to take advantage of these gaps.
Step 6. Identify Strengths and Weaknesses
As important as it is to know your SaaS company’s strengths and weaknesses, knowing your competitor’s strengths and weaknesses can help you hone your communication effectively.
For example, if your content team is working on a listicle of “best social media management tools,” they would be better positioned to frame the content if they know how your tool fares against your competitors.
Knowing this also helps your sales team interact with potential customers better and leads to more conversions.
Step 7. Adapt New SEO Strategy
Your competitors must have done a lot of research to nail their SEO strategy. You can save time and guide your strategy in the right direction by getting insights into their different SEO strategies.
You can even save your marketing dollars by investing in only those strategies that bring results.
While auditing your competitor’s SEO, ensure you use tools that give you solid numbers and proof of what works and what doesn’t.
What to Include in SaaS Competitive Analysis?
Here are five key elements your SaaS competitive analysis should cover:
Competitor Investigation
Aim to finalize at least five competitors for your SaaS competitive analysis. If there aren’t many direct competitors, find the indirect ones that could move into your niche in the future or offer solutions that could replace yours.
Unique Selling Propositions (USPs)
There are a lot of social media management tools available on the internet. How do you differentiate your tool from the rest? By conducting a competitive analysis and finding the features/UI/experience that sets yours apart.
Look how ClickUp showcases its USPs on comparison-based landing pages.
Keyword Research
Find out the most popular organic keywords your competitors are ranking for. Note details like search volume, keyword difficulty, ranking, and URLs against them. You can even observe the types of content they are creating for each keyword and if they create content clusters around particular keywords.
Marketing Strategy
Do they use only blogs for their content types? Or do they actively create ebooks for lead magnets? Which social platforms are they most active on? For which purposes do they craft email marketing campaigns? Breaking apart their marketing strategy will give you great insights into what appeals to your audience and what would work best for your SaaS tool.
Market Share
How much market share do your competitors have at the present? Is it declining or growing? Is it steadily rising because of the new features they are introducing or something else? Can you replicate any of those reasons to increase your market share? Asking questions like this can help you find ways to move your tool to the top.
What Are Some Useful Competitive Analysis Frameworks?
A competitive analysis framework is a model or tool marketing professionals use to research and evaluate their competitors. Here are four common frameworks:
SWOT Analysis
SWOT stands for Strengths (internal factors that are advantageous), Weaknesses (internal factors that are disadvantageous), Opportunities (external factors that bring opportunities), and Threats (external factors that bring challenges).
This method is especially useful if you are conducting a competitive analysis for the first time and want to identify your competitive advantages and areas of improvement.
The only limitation is that it does not provide any actionable plan or solution to a problem.
Porter’s Five Forces
A framework created by Michael Porter, this method examines five main forces in any industry:
- Threat of new entrants
- Intensity of competition
- Bargaining power of new buyers
- Bargaining power of new suppliers
- Threat of substitutes
You should follow this framework to determine a particular industry's competitive structure. Mostly this is carried out at the beginning when you foray into a new market. The limitation of this model is that it only considers external factors.
Growth-Share Matrix
The Growth-Share Matrix is ideal for companies with a large product or product portfolio. It classifies products into:
- Stars: Products with high growth and high market share. Invest more in them.
- Question Marks: Products with high growth but low market share. Decide what to do with them.
- Cash Cows: Products with low growth but high market share. Normally used to fund star products.
- Pets: Products with low growth and low market share. Either reposition the product or give up on it.
Perceptual Mapping
Perceptual mapping helps you visualize your company and competitors on a plot graph for two chosen factors — for example, perceived quality and price.
It’s a great framework if you want to see how your customers view your product against others on two specific factors. With this knowledge, you can identify market trends and gaps and improve your positioning strategy.
What Are Some Tools for Conducting SaaS Competitive Analysis?
Certain tools can help you conduct your analysis better and quicker. Let’s explore six such tools.
SEMRush
SEMRush is an all-in-one marketing tool that allows you to do many things like competitor research, keyword research, search engine optimization, PPC, etc.
With this tool, you can identify the keywords your competitors are ranking for, their organic and paid traffic sources, content marketing and social media marketing strategies, and various advertising tactics. You can even analyze your market position with their market analysis features.
Ahrefs
Ahrefs offers similar features to SEMRush. It helps you analyze your competitor’s website, traffic, and strategies. With their Site Explorer tool, you can enter the competitor’s name and get a list of keywords they rank for. You can add filters to this list to narrow down your desired results.
You can even conduct a site audit to dig deep into the various issues your/competitor’s site faces.
Ubersuggest
Ubersuggest provides you with many tools like a backlink checker, SEO analyzer, website traffic checker, etc. They have also recently introduced a new feature where you can type in a competitor’s domain to get better keyword ideas.
Their SEO analyzer allows you to find competitor pages ranking for popular organic keyword phrases. You can then create content that is better and more engaging.
Moz
Moz is an all-in-one tool for fulfilling all your SEO requirements. They also have a specific tool for competitive analysis. Their True Competitor Engine lets you discover your top competitors, find keyword gaps, and content opportunities.
The tool also provides three free reports daily if you want to try it first.
BuzzSumo
BuzzSumo has a special use case that provides you with competitor intelligence. It’s one of the best tools to strengthen your content strategy.
You can study the competition and find out what content works, which platforms are best, which kind of people share their content, and how your content compares with theirs. Not only that, you can even find out the gaps in their social media strategy and take advantage of them.
Hootsuite Streams
Hootsuite Streams is a powerful tool that lets you track keywords, hashtags, and competitors across all social channels. It is built to be intuitive and responsive so anyone in the team can easily use it and get the insights they need in one place.
You can even monitor their posts, engagement, social topics, and trends they follow and get detailed insights.
Thriving in a Competitive Industry
SaaS competition will only get intense in the coming years.
Instead of ignoring it, you can start preparing for it with our outlined competitive analysis process. Once you’re done, create a document with your competitor’s name, product, USPs, website and content strategies, strengths and weaknesses, and the insights you uncovered from your analysis.
Don’t stop there! Continuously update this document and implement your learnings to make the best out of your competitive analysis.
If your team doesn’t have time to spare or you’re looking for experts to take over your competitive analysis, reach out to our team at MADX. Or, you can head over to our blog to get more insights into your SaaS business.
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