Is competitive analysis necessary in UX design?

Is competitive analysis necessary in UX design?

A real time example could be Starbucks. Purchasing a cup of coffee has become an "affordable luxury"- Starbucks sets itself unique from its competitors using “pricing strategy” considering premium option for profit maximization.

We need to research major competitors to get some insights on their strategies. Here are some of the ways to research the competitors-

i) Understanding our competitors:

Firstly, we need to find our competitors. We can do this with the help of user research interviews. On understanding our competitors we will know where we are in the market and it will also allow us explore new opportunities. Furthermore, it will help us set our product and marketing tactic unique.

It’s important to know about our competitors as it will not only inform us in taking design decisions but it will also help us in formulating overall product strategy.

ii) Group the competitors:
Direct competitors: There are direct competitors who offer the same product at similar price points to satisfy customers' needs.
Indirect competitors: There are indirect competitors who offer different value proposition to the same customers.

iii) Gather information about each competitor:

It is necessary to look around, research and gather relevant information. The collected information can be added in the spreadsheet.

Name, url, direct or indirect competitor.Summary: It an be a brief about the company’s value propositions, target audience, product and interesting findings.Pros: If they have advantageous product, design details, solutions.Cons: If there are any usability issue, missing feature, negative feedback/ reviews.

iv) Define product strategy
There must be a focus on how the customer interacts with the product and what he feels while using the product.

Observe market gaps: With the help of competitor analysis, it will be easy to figure out if any feature is missing out in the competitor’s product.Find what strategies work: It is possible to find out the kind of marketing strategy to employ to generate more conversions.Look what idea this market lack: Based on the results, we can identify the things to be improved to attract more potential users.

v) Successful product

By building value into our innovation strategy, it is possible to provide more value to the customers. Generally, most companies offer at a lower price with a maximum benefits to pull the customers attention.

Wrapping up:

In this competitive world, it is necessary to stay updated to the changing trends doing a competitive analysis will help us recognize how we can enhance our own business strategy.

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