3 Things Startups Need To Know About Competitor Analysis

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No business operates alone in a market. Operating alone means that you’re some kind of anomaly and that you invent a new market, which is equal to a miracle. The market is the market, and the market alone will decide whether you’re better or worse than your competitors. As a startup, you want to know who else is providing the service that you plan to offer in the market. There is a lot more than meets the eye that startups need to know about competitor analysis.

With competition analysis, you can predict what will be your competitor’s reaction when you decide to enter the market. You will also predict how your customers will perceive your product compared to the competitors. You can utilize your competitors’ weaknesses to gain more customers for your startup. You’ll find out what worked for them to help you think more innovatively while modeling your new strategy. Knowing as much as you can for your competition will be crucial to the success of your business.

You’re not alone in the market

Competitor’s strengths and weaknesses

You need to analyze what actions your business should undertake to create barriers of entry for your eventual competitors. Some of these barriers involve high cost of investment, competitively priced market, business setup period and technology, and innovation. There is also a lack of staff quality, consumer’s resistance, patents, trademarks, & market and industry reputation.

Analyzing and understanding your competition

Your competitor’s analysis should incorporate the pricing history of the competitor’s products and the changes that caused a modification in pricing strategies. Also, when do your competitors perform their promotional activities? It’s all about timing and its effect, and the timing alters your competitor’s perception of your target audience.

We suppose that your competitors also have a concept behind their product promotional campaigns. This includes product packaging, sales promotions, and PR events too. You need to collect everything that there is to know about their advertisement campaigns and analyze how to improve it.

Final thoughts

To know about competitor analysis means analyzing your competitors’ strengths and weaknesses as a crucial step for creating your startup’s advantage on the market. Finding the reason why a competitor is struggling in the market will prevent your startup from making the same mistake. On the other hand, finding your competitor’s strong side will help you understand what it takes to be successful in the market. And most importantly, why there’s a space for one more venture to enter the market.

Still, don’t know how to start with competitor analysis? Check out our 6-step approach for more insights.

This article was originally published on BizzBee Blog.

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