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Analyze your competitive landscape using Porter's Five Forces and modern frameworks—understand industry dynamics, identify strategic opportunities, and position your business for sustainable advantage.
Use this skill when you need to:
This skill is particularly valuable for:
Source: Michael Porter - Harvard Business School (1979-present) + modern competitive intelligence best practices
Core Principle: Industry structure, together with a company's relative position within the industry, are the two basic drivers of company profitability. Understand the five competitive forces to anticipate shifts, shape industry evolution, and find better strategic positions.
"The essence of strategy formulation is coping with competition."
| Claude Does | You Decide |
|---|---|
| Structures production workflow | Final creative direction |
| Suggests technical approaches | Equipment and tool choices |
| Creates templates and checklists | Quality standards |
| Identifies best practices | Brand/voice decisions |
| Generates script outlines | Final script approval |
When invoked, I will guide you through comprehensive competitive analysis:
Provide information about your competitive situation:
Example prompts:
Information that helps:
#### Overview
Porter's Five Forces determine the competitive structure of an industry and its profitability.
Threat of
New Entrants
↓
Supplier → COMPETITIVE ← Buyer
Power RIVALRY Power
↑
Threat of
Substitutes| Force | Key Question | High = |
|---|---|---|
| Rivalry | How intense is competition? | Lower profits |
| New Entrants | How easy to enter? | More competition |
| Supplier Power | Can suppliers dictate terms? | Higher costs |
| Buyer Power | Can customers dictate terms? | Lower prices |
| Substitutes | Are alternatives available? | Less pricing power |
Analyze the intensity of competition among existing players.
#### Assessment Questions
| Factor | Questions to Ask |
|---|---|
| Number of competitors | How many significant players exist? |
| Market concentration | Is it dominated by few or fragmented? |
| Industry growth | Growing, stable, or declining? |
| Product differentiation | Are products similar or distinct? |
| Switching costs | How hard is it for customers to switch? |
| Exit barriers | Can companies easily leave? |
| Fixed costs | Do high fixed costs drive price competition? |
#### Rivalry Intensity Scale
| Level | Characteristics | Profit Impact |
|---|---|---|
| Low | Few competitors, differentiated products, high growth | Higher margins |
| Medium | Several competitors, some differentiation, stable growth | Moderate margins |
| High | Many competitors, commodity products, slow/negative growth | Thin margins |
#### Red Flags (High Rivalry)
Analyze how easy or difficult it is for new players to enter your market.
#### Barriers to Entry Assessment
| Barrier | Low Threat | High Threat |
|---|---|---|
| Capital requirements | Low startup costs | High investment needed |
| Economies of scale | Small players viable | Must be large to compete |
| Brand loyalty | Weak brands | Strong incumbent brands |
| Switching costs | Easy to try new | Locked-in customers |
| Distribution access | Open channels | Controlled by incumbents |
| Regulatory | Few requirements | Heavy licensing/compliance |
| Technology/IP | Accessible tech | Patents, proprietary tech |
| Network effects | Weak | Strong winner-take-all |
#### Entry Threat Signals
Analyze the leverage suppliers have over industry participants.
#### Supplier Power Assessment
| Factor | Low Power | High Power |
|---|---|---|
| Number of suppliers | Many alternatives | Few/sole source |
| Uniqueness | Commodity inputs | Proprietary/specialized |
| Switching costs | Easy to change | Expensive/difficult |
| Forward integration | Unlikely | Credible threat |
| Importance to supplier | Major customer | Small customer |
| Substitute inputs | Available | None |
#### High Supplier Power Examples
Analyze the leverage customers have over your business.
#### Buyer Power Assessment
| Factor | Low Power | High Power |
|---|---|---|
| Buyer concentration | Many small buyers | Few large buyers |
| Purchase volume | Small orders | Large orders |
| Standardization | Differentiated products | Commodity products |
| Switching costs | High costs to change | Easy to switch |
| Price sensitivity | Value-focused | Price-focused |
| Information | Limited knowledge | Well-informed |
| Backward integration | Unlikely | Credible threat |
#### Managing Buyer Power
Analyze alternatives that meet the same customer need differently.
#### Substitute Threat Assessment
| Factor | Low Threat | High Threat |
|---|---|---|
| Price-performance | Worse value | Better value |
| Switching costs | High | Low |
| Buyer propensity | Loyal to current | Open to alternatives |
| Functional similarity | Different experience | Similar outcome |
#### Common Substitute Patterns
| Your Category | Potential Substitutes |
|---|---|
| Physical stores | E-commerce |
| Air travel | Video conferencing |
| Newspapers | Social media, podcasts |
| Cable TV | Streaming services |
| Taxis | Ride-sharing, bikes, public transit |
| Hotels | Airbnb, corporate housing |
| Consultants | Software, DIY templates |
#### Defending Against Substitutes
After analyzing all five forces, determine overall industry attractiveness:
| Profile | Characteristics | Strategic Implication |
|---|---|---|
| Attractive | Weak forces across the board | Enter/invest, potential for strong profits |
| Moderately Attractive | Mixed forces | Selective entry, focus on positioning |
| Unattractive | Strong forces across the board | Avoid or find niche, low profit potential |
#### Profitability Spectrum
ATTRACTIVE UNATTRACTIVE
(Higher profits) (Lower profits)
| |
Commercial aircraft ←―――――――――――――――→ Fast food
Pharmaceuticals ←―――――――――――――――→ Retail grocers
Enterprise SaaS ←―――――――――――――――→ Commodity tradingBeyond industry forces, analyze specific competitors:
#### Competitor Profile Template
| Dimension | Questions |
|---|---|
| Overview | Who are they? Size, history, ownership? |
| Products/Services | What do they offer? Key features? |
| Target Market | Who do they serve? Segments? |
| Positioning | How do they position? Messaging? |
| Pricing | Price points? Model? |
| Strengths | What are they great at? |
| Weaknesses | Where do they struggle? |
| Strategy | What's their apparent strategy? |
| Recent Moves | New products, partnerships, hires? |
#### Competitive Intelligence Sources
| Source Type | Examples |
|---|---|
| Public filings | Annual reports, SEC filings, press releases |
| Website/content | Pricing pages, blog, case studies |
| Job postings | Reveals priorities, tech stack, expansion |
| Social media | Company pages, employee posts |
| Reviews | G2, Capterra, Glassdoor, Trustpilot |
| Customer interviews | Win/loss analysis, churned customers |
| Industry reports | Analyst reports, market research |
| Events/conferences | Presentations, booth messaging |
Based on your analysis, consider positioning strategies:
| Strategy | Description | Best When |
|---|---|---|
| Cost Leadership | Lowest cost producer | Scale advantages, commodity market |
| Differentiation | Unique value proposition | Can sustain uniqueness |
| Focus (Cost) | Low cost in niche segment | Niche has distinct needs |
| Focus (Differentiation) | Unique value in niche | Niche underserved |
#### Finding Positioning Gaps
Look for areas where:
Context: Startup considering entering project management software market
Industry Definition: Cloud-based project management software for SMBs
Five Forces Analysis:
| Force | Assessment | Rating |
|---|---|---|
| Rivalry | Extremely high—Asana, Monday, Notion, ClickUp, etc. Constant feature releases, price competition | HIGH |
| New Entrants | Moderate—Low capital requirements but network effects and switching costs protect incumbents | MEDIUM |
| Supplier Power | Low—Cloud infrastructure (AWS, GCP) is commoditized | LOW |
| Buyer Power | High—Many alternatives, low switching costs, free tiers available | HIGH |
| Substitutes | High—Spreadsheets, email, Slack, Trello (freemium) | HIGH |
Overall Industry Attractiveness: LOW - Very competitive with strong buyer power and many substitutes
Strategic Implications:
Recommended Positioning: Focus on underserved vertical (e.g., "Project management built for creative agencies") where:
Context: Evaluating market entry for premium DTC coffee subscription
Industry Definition: Direct-to-consumer specialty coffee subscription (US market)
Five Forces Analysis:
| Force | Assessment | Rating |
|---|---|---|
| Rivalry | High—Blue Bottle, Trade, Atlas, Driftaway, plus local roasters | HIGH |
| New Entrants | High threat—Low barriers, minimal capital, e-commerce accessible | HIGH |
| Supplier Power | Moderate—Quality beans require relationships, but multiple origins | MEDIUM |
| Buyer Power | High—Many options, easy cancellation, price-sensitive | HIGH |
| Substitutes | Very high—Supermarket coffee, local cafes, instant coffee | VERY HIGH |
Overall Industry Attractiveness: LOW - Highly competitive commodity market
Competitor Landscape:
| Competitor | Positioning | Strength | Weakness |
|---|---|---|---|
| Blue Bottle | Premium, artisanal | Brand, quality | Price, accessibility |
| Trade Coffee | Discovery, variety | Selection, tech | Generic brand |
| Atlas Coffee | World exploration | Unique experience | Niche appeal |
| Local roasters | Authentic, local | Community, freshness | Scale, convenience |
Positioning Gap Identified:
Recommended Positioning: "Autopilot premium" - Ultra-convenient premium coffee for busy professionals
INDUSTRY: ____________________
DATE: ____________________
FORCE 1: COMPETITIVE RIVALRY
━━━━━━━━━━━━━━━━━━━━━━━━━━━
Key competitors:
1. ____________________
2. ____________________
3. ____________________
Assessment:
□ Number of competitors: Few / Several / Many
□ Industry growth: High / Stable / Declining
□ Product differentiation: High / Moderate / Low
□ Exit barriers: Low / Moderate / High
□ Fixed costs: Low / Moderate / High
RIVALRY INTENSITY: □ Low □ Medium □ High
FORCE 2: THREAT OF NEW ENTRANTS
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
Barriers to entry:
□ Capital requirements: High / Moderate / Low
□ Economies of scale: Strong / Moderate / Weak
□ Brand loyalty: Strong / Moderate / Weak
□ Switching costs: High / Moderate / Low
□ Distribution access: Difficult / Moderate / Easy
□ Regulatory barriers: High / Moderate / Low
ENTRY THREAT: □ Low □ Medium □ High
FORCE 3: SUPPLIER POWER
━━━━━━━━━━━━━━━━━━━━━━━
Key suppliers/inputs:
1. ____________________
2. ____________________
Assessment:
□ Number of suppliers: Many / Several / Few
□ Uniqueness of inputs: Commodity / Specialized / Unique
□ Switching costs: Low / Moderate / High
□ Forward integration threat: Low / Moderate / High
SUPPLIER POWER: □ Low □ Medium □ High
FORCE 4: BUYER POWER
━━━━━━━━━━━━━━━━━━━━
Key buyer segments:
1. ____________________
2. ____________________
Assessment:
□ Buyer concentration: Fragmented / Moderate / Concentrated
□ Purchase volume: Small / Moderate / Large
□ Product differentiation: High / Moderate / Low
□ Switching costs: High / Moderate / Low
□ Price sensitivity: Low / Moderate / High
BUYER POWER: □ Low □ Medium □ High
FORCE 5: THREAT OF SUBSTITUTES
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
Key substitutes:
1. ____________________
2. ____________________
Assessment:
□ Price-performance of substitutes: Poor / Comparable / Better
□ Switching costs: High / Moderate / Low
□ Buyer willingness to switch: Low / Moderate / High
SUBSTITUTE THREAT: □ Low □ Medium □ High
OVERALL INDUSTRY ATTRACTIVENESS
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
□ Attractive (weak forces)
□ Moderately attractive (mixed forces)
□ Unattractive (strong forces)
KEY STRATEGIC IMPLICATIONS:
1. ____________________
2. ____________________
3. ____________________COMPETITOR: ____________________
LAST UPDATED: ____________________
OVERVIEW
━━━━━━━━
Company type: ____________________
Founded: ____________________
Size (employees/revenue): ____________________
Funding/ownership: ____________________
PRODUCT/SERVICE
━━━━━━━━━━━━━━━
Core offering: ____________________
Key features: ____________________
Pricing: ____________________
Target market: ____________________
POSITIONING
━━━━━━━━━━━
Tagline/messaging: ____________________
Key differentiator: ____________________
Brand perception: ____________________
SWOT SUMMARY
━━━━━━━━━━━━
Strengths:
• ____________________
• ____________________
Weaknesses:
• ____________________
• ____________________
RECENT ACTIVITY
━━━━━━━━━━━━━━
□ New product launches: ____________________
□ Partnerships: ____________________
□ Key hires: ____________________
□ Funding/acquisitions: ____________________
STRATEGIC IMPLICATIONS FOR US
━━━━━━━━━━━━━━━━━━━━━━━━━━━━
Opportunity: ____________________
Threat: ____________________
Action: ____________________Before deep analysis, quick gut-check:
If most answers are "yes," expect a challenging competitive environment.
Primary Sources:
Additional Resources:
~30 seconds. Free. No account. Every finding cites a rule and a line of evidence.