Don’t Be Afraid To Research Into Your Competitors. Here’s Why.
In the early 2009, I was involved with a ecommerce cell phone accessory business. At the time I hated researching into my market and my competitors. The reason behind it was because I felt like the more results I knew about the more worried I would be due to the feeling of not being able to beat my competitors. I was worried that the field would be too competitive and was also worried that my idea would fail due to the competitiveness. Luckily, I have a close friend that did not care about competitiveness and loved to do research on his free time. Because of that my business was very successful and eventually I sold it to a larger import company.
My second business venture was a little different. I was on my own and still refused to research into my competitors. Because of that, I didn’t know about the niche well enough. I didn’t know what I was getting into, therefore I failed terribly. I learned from that, and every business venture that I dive into, I make sure that I research into my competitors.
What To Look For When Conducting Research
After you have found a product or idea that you are passionate about, start doing your research. The first thing you should always be looking for first is how big the market size of your idea is. If your idea is a custom t-shirt website, then your market is huge. That means that chances are that you have a lot of competitors and a lot of potential buyers as well. If your market size is small and you see that you have zero competitors, then that might be something to be worried about as well.
After you have a brief overview of the market size, now it is time to see what your competitors are all about. Let’s take the custom T-shirt as an example. Simply type your niche’s category into Google. Look at the results:
Notice all these competitors and their pricing. The whole point of this is to be able to discover the price range of your niche. As we can tell from the ads, the price range is between 7 dollars and 13 dollars for a custom t-shirt. That should give you an idea on how to price your own item.
If you are a local business you could try using yelp to find price ranges and reviews. The next thing we will research into is customer feedback. We want to read through the reviews of our competitors to try and understand what they are doing incorrectly. We try to fix that in our own business to outplay them. Here’s a sample from Yelp.
Clearly this store was not treating their customers correctly. The customer complained that the store employees were being rude and that customer service was terrible. Now you have found a hole in your competitors business! You could do better than that! Advertise your business that way, let the world know you have excellent customer service, but make sure you can back it up.
In addition to just determining what your competitors are doing poorly in, also try and figure out what they are excelling in. That way you can take in what works for them and you can make it even better.
Don’t Let Results Scare You
The problem with me was that I was worried about the results. I was worried that I won’t win my competitors. That is a terrible mentality. You should never even think about going against a successful company head to head, instead think about what differs you from them. What can you add to the spice that the other company cannot. If the market size is big enough that means you can take a share of it, you just need to work harder than them.
Think about it, if you walk out to the streets, how many subways do you see? How many coffee shops do you see? In a big city, there’s almost one every block. After I understood that theory, I worried less about my competitors beating me, instead I focused more on finding out what are they doing better and how I could improve.
But My Competitors Are Bigger Than Me
You have to remind yourself that no matter how big the company is, it began small. Growing is a huge stepping stone that you can accomplish as well. Bigger companies also rarely target niche audience and communities. You can connect more directly with customers through smaller communities. In the end just don’t be scared and overwhelmed by the results of your competitor.