There is always competition, and that is a good thing! Even if you think that you are creating something completely new, there is usually a reference market for comparable products or services. Especially in the startup phase, it is important to learn a lot from the competitors in your market by analyzing and questioning their existing business concepts.
Know your enemies and friends
A competitive analysis is the most cost-effective form of market research! If you examine the relevant market in more detail, you will find some companies that are already trying to solve the identified problem in a certain way. You may also have noticed some of these companies when you worked on your problem solution. Now it is time to work out how your solution differs from the others. The easiest way is to create a table of your own value propositions and collate them with the competition.
The VP-Competition-Matrix
Analogs and Antilogs
Now refine your analysis and derive specific characteristics of your market from the competitors under consideration. Are the customers in this market highly competitive? Are there any specific customer segments that are preferable? Which sales models are used in the market? Which different business models can be found in the market? Is the market subject to certain rising or falling trends? Compare your project with this appraisal and identify the so-called analogs in the market. Who has already successfully implemented which components of your project? On the other side, antilogs can be found when market participants deliberately choose new, different, or conflicting models that have either been untested, previously failed, or are being transferred from a completely different market.
Iterations
Intensive competition and market analysis quickly give you the feeling of having to go back to »Go« and having to start over. Firstly, that would not be bad; secondly, despite competition, that does not necessarily have to be the case. Based on the analyses, the existing concept can often be adapted quickly and easily. After all, potential customers have already been identified and found in the »Go to Market« test. If you did not find any customers, this analysis has hopefully made clear where the problem lies. If there are similar offers and you were still able to get your first customers, there could be potential. If not, follow the startup mantra »Take harsh decisions fast and iterate constantly. «
Iterations
Learn more about the ninth module „Competition“ of the Startup Navigator in the handbook.