Creating and selling a product necessitates extensive research. While costs, supply chain capabilities, and other internal factors are important, businesses must also consider their competitors. A thorough market product analysis investigates the functionality, customer perception, and cost of competitors’ products, allowing businesses to improve their own product development.
What is Product Analysis?
Product analysis dissects a product from beginning to end, examining everything from components, functions, technology, expenses, and needs to marketing materials, websites, and sales strategies. What the product does should be consistent with what the company claims it does. Analysis of cost-quality ratios, alternative designs, and competition all play a role in determining if the product is cost-effective while meeting the needs of the client. It is extremely advantageous if the company can make minor changes to the design while maintaining product quality and lowering costs.
This is a lengthy process, but the results can help the company in manufacturing, quality assurance, logistics, and sales. Prior to submitting a product design and/or development technique for a patent, it is a good idea to do a product analysis. Prior to submitting a product patent, you need to identify whether it is a design, utility, or plant patent. Although a design patent may protect the aesthetics of your product, it may not protect the functionality that a utility patent would cover. Check out our post on Patent 101 for more details.
How to Conduct a Product Analysis
Identifying the final aim is the first step in producing a product analysis. Do you want to compare the quality or usefulness of one product to another? Attempting to adopt or modify a design? Looking to save money on your current design? Understanding the message relayed to see if it corresponds to what the product does? Once you determine the purpose of this product analysis, you can begin to formulate a series of questions to elicit the necessary answers.
If you’re not sure where to begin, there are numerous product analysis templates and product analysis samples available online. After you’ve gotten these responses, write them down in a product analysis report so you may update, change, or somewhat alter your current product and/or message. When writing a product analysis, keep the following points in mind:
- What is the product’s role and purpose?
- What are the various components of the product, and how do they interact?
- Describe how the product employs shape, form, colour, texture, and adornment.
- What materials and components are used in the product’s construction?
- What processes were used to manufacture the product?
- Who is likely to purchase this product?
- How well does the product perform in comparison to other similar products?
- What distinguishes the product?
Example of Product Analysis
A t-shirt is a simple product analysis example. To begin, examine numerous aspects of this t-shirt to determine its quality. Some possible questions for this shirt include:
- What is the t-fabric? the shirt’s What about the standard? And what happens to that material after it’s washed?
- What are the colours of the T-shirt? Will the colours bleed together? Is the print ink of superior quality if printed on?
- Where is the t-shirt made, and how easy is it to make the product there?
- What are the manufacturer’s capacities for future orders?
- What is the MOQ (minimum order quantity)?
- Is the manufacturer’s compliance certified and audited?
In this case, we were concerned with both the quality of the t-shirt and the quality of the maker. To ensure that one takes every factor into consideration, the list of questions for each area can be fairly lengthy. Here’s another example of a flow diagram for a CPU product analysis.
After evaluating the manufacturer’s intended KPIs, a decision can be made on whether to adjust the process, the output, or switch manufacturers entirely. Carry out this assessment for each part and compile a report with action items for problem areas.
Read Also: MARKET MAPPING: How To Utilize It For Competitive Advantage
A product disassembly can be used to acquire as much information as possible if a product requires comprehensive technical inspection. The analysis’s findings are based on the needs of the product and the available resources.
Whether you outsource or maintain a product analysis in-house, the goal and outcomes of a product analysis are incredibly valuable. Beginning a product analysis at the inception of a concept can assist in determining the current market environment.
Product analysis is to identify every aspect of a product so that firms may better manage their profitability and customer attractiveness. The analysis includes but is not limited to
- Components
- Functions
- Technology
- Designs
- Costs
- Availability
- Demand from customers
- Materials
- Marketing strategy
- Competition in the market
- Comparable Products
- The average sales
- Profitability
- Quality
- Customer feedback
While product analysis is time-consuming, it gives all of the information required to decide whether inventory fulfils the company’s criteria and client preferences. If the review gives insufficient results, organisations can decide whether to remove the item from their lineup or experiment with alternative designs.
This approach is also useful for determining whether the output from each product is worth the initial investment, which is referred to as the return on investment (ROI).
Product analysis can help you learn more about production, logistics, sales, and product development. Companies determine what type of patent they need and their target market by outlining all of the fine characteristics of an item.
5 Product Analysis Steps
While the product analysis process is lengthy, the stages themselves are thorough and may be adjusted for any type of firm.
#1. Research the Competitors
Before beginning research, organisations must first understand their competition. Competitors can be found both inside and outside of the target market, which is referred to as direct and indirect competition. Organisations should examine anyone that provides similar products and services, is located in the same region, and caters to the same customers.
#2. Carry out research
Once you know the competitors, management can conduct a competitive product analysis by researching the firms’ market histories. Owners can separate their own methods to optimise client reach and fulfilment by specifying the business models. Management can begin by identifying competitors:
- Pricing methods
- Demographics of customers
- Negatives
- Marketing strategies
- Expansion through the years
#3. Examine Product Specifications
To have a deeper understanding of a competitor’s products, project managers should examine their marketing materials, brochures, emails, product websites, and public annual reports. These materials assist owners in evaluating the pricing, marketing, and sales methods of other businesses.
Companies can determine rivals’ goals, performance against other firms, and market foothold through further evaluation. Businesses in the surrounding area may be attempting to increase their market share, long-term earnings, and market growth.
#4. Develop a Competitor Strategy
Understanding competitors’ goals and strategies allows firms to establish what differentiates them and how they might gain an advantage. Owners may discover they need to change their strategy as a result of the competitive analysis:
- Pricing methods
- Quality
- Marketing strategies
- Customer service
- Channels of Distribution
- Product Specifications
This information gives insight into the company’s performance and how it can fulfil goals such as sales and financial targets. For example, if competitors ignore online sales marketing, the corporation might exploit this vulnerability by gaining a foothold in the e-commerce sector.
#5. Ongoing Research
Some businesses may discover that a single competitive product analysis is insufficient. Managers should revise their evaluations on a frequent basis in this situation to keep up with market changes. This also allows businesses to adjust their business strategies in response to evolving trends and competitors.
Product Analysis Tips
Product analysis involves various variables, ranging from market to competition trends.
#1. Begin with a flagship product.
A flagship product is an initial item or key solution introduced by a company. Managers should begin their analysis with flagship products and gradually expand their scope, as these items often create the most sales and money.
#2. Products that are benchmarks
While the success of rivals’ products is important in the analysis process, organisations must also set goals for themselves. Businesses can see where they stand in the market and against the competition by developing benchmarks. It also makes defining strengths and weaknesses simple.
#3. Examine Product Pages
Product pages provide useful information on an item’s functionality, demand, user reviews, and frequently asked questions. By allowing managers to get to know products, these insights enable a more complete analysis.
#4. Think about Product Videos.
Many shops offer product videos that show how one can use their products, allowing shoppers to visually interact with stuff before purchasing. Businesses, on the other hand, can utilise these demonstrations to assess user experience and identify potential concerns.
#5. Make use of Customer Feedback
Companies must use client feedback to acquire a true sense of product quality since it provides honest, unbiased viewpoints. Some organisations prefer to contact clients in person and create a survey, while others trawl through review sites.
#6. Evaluate Marketing Strategies
The way a product is exhibited and discussed reveals information about a company’s marketing strategy and client reach. As a result, businesses should pay attention to how their competitors portray things, identify benefits, and run marketing.
#7. Monitor Product Changes
Organizations can notice when competitors modify the features, functionality, and designs of their products by conducting routine product evaluations. This is a significant indicator of their plans and emerging demand trends, which may have an impact on the entire market.
What is a Product Demand Analysis?
A product demand analysis attempts to provide an accurate prediction of your product’s potential sales. It’s a method of determining how competition, seasons, and other pertinent events influence the sales of a specific product.
Product demand analysis can be performed at any moment – even for products that aren’t currently on the market. Demand can be projected based on changes in society, technical improvements, and environmental changes, in addition to past sales.
So, obviously, there are many forces at play, and no one can foresee the future down to the last chocolate bar sold. However, forecasting product demand is critical for developing a future-proof firm. This is why.
Why should you do a Product Demand Analysis?
The aims of your product demand analysis are heavily influenced by the stage of your business or product.
#1. Idea validation and financial planning
You could be conducting exploratory market research to see if there is a large enough market for you to enter with your product. And if there is, could you enter at a high enough price point to make your idea worthwhile to pursue?
#2. Purchasing materials from vendors
Product demand analysis is also vital for organisations that rely largely on secondary producers or external resources. Will you be able to obtain the required components on time?
#3. Spend less money and work more efficiently.
One of the purposes of conducting a product demand analysis could be to save money. Knowing when your product will be popular can help you deploy your budget and staff more effectively. Knowing when demand will be higher will allow you to plan your budget and schedule for marketing initiatives, as well as ensure you have enough personnel on the job to manage the increased orders.
Product Analysis FAQs
What is product analysis in PMP?
Product analysis is a critical project management technique that is required for projects that include products as a deliverable. It is a mechanism for defining the scope of the product.
What are areas for product analysis?
Product analysis entails investigating product characteristics, pricing, availability, quality, appearance, and other factors. Potential buyers, product managers striving to understand competitors and third-party reviewers perform product analysis.
Why do we do product analysis?
Product analysis’s goal is to offer manufacturers the deliverables they need to understand and perfect their products. The analysis guarantees that the product is market-ready, that it reaches the intended target market, and that the anticipated results are achieved.
