When you develop a business idea in your mind, the first thing you need to do is look up your idea online to find out who your competitors are. When you study your competition, you can eliminate a lot of the risk that goes into starting a business by evaluating whether your idea is profitable, finding out who the customers are, and even locate people you can team up with to reach even more people.
Let’s explore all the things you can learn by studying your competition.
- Understand Your Market – Aside from understanding your ideal customer, you need to know how the market works for your idea. For example, is the market seasonal? Are there price wars? How many people want what you’re offering? Is there a place for a small start-up like yours, or does the big business own the market?
- Increases Brand Differentiation – It’s incredible to look at your competition and realize that your ideas aren’t as unique as you thought. The truth is that most ideas have already been developed with few exceptions. This is not a bad thing since this also lowers the barriers to entry. Your job is to figure out how you fit in and how you can stand out from the rest.
- Allows You to Discover Gaps in Value Offered – When you study your competition, keep a list of places they can do better or value that they’re missing. It’s within the gaps of coverage that you may find an entire business.
- Introduces You to Your Ideal Customer – You’re not out to steal your competitor’s customers but instead get to know the customer so that you can create better and more targeted products, services, and marketing content that speaks directly to the portion of the audience you want to attract.
- Gives You a Jump on Systems and Processes Needed – Taking a deep dive into your competition’s systems and processes is also a great way to shortcut your way into creating a sustainable business. If you can find software to help you run your business efficiently, you’ll end up becoming profitable that much faster.
- Helps You Position Yourself Within the Market – When you know that you have competition, you can more easily figure out where you fit in with them. For example, as a small business owner, you might decide to focus on value-added options that enable you to boost your per-customer price point over the competition that is a low-price leader.
- Increases Understanding of Your Audience – While studying your competitors, you’ll naturally learn about their audience, and the good news is, most of their audience is also your audience. This is especially true if you find complementary products, services, and added value to offer them that your competition is not offering.
- Highlights Your Own Flaws – As you study your competition, you’ll notice that you had ideas that may not fit in with the reality that is coming to light based on your findings. For example, maybe you thought you could charge three times what your highest charging competitor is charging, or you found out their logo idea looks just like your idea. These are all things that can be fixed with knowledge.
- Find People to Joint Venture With – The most exciting aspect of studying your competition is finding people to joint venture with on various projects. You can also locate affiliate products to promote to your audience.
It should be clear by now that you need to study your competition so that you can identify whether your idea is profitable or not, find your audience, and even find people to work with to move your business to profitably even faster. Don’t skip competition research if you really want to be successful, differentiate yourself, and become profitable more quickly.
