5 Reasons Why You Shouldn’t Ignore the Competition

Why You Shouldn’t Ignore the CompetitionIt’s commonly perceived that those possessing entrepreneurial spirit are intelligent, rational innovators whom are able to go above and beyond in order to make a profit. However, the reality is that entrepreneurs are people, people like you and I. As such, depending on the circumstance and emotional anchors from our past experiences we can be both rational and irrational.

It’s incredibly easy, and common for people to have emotional barriers to entrepreneurship. For example you may have a desire to concentrate on what you’re doing and ignore the competition, or perhaps due to a negative past experience.

However there are very good reasons as to why you shouldn’t ignore the competition, here is five of them:

Learn From Competitors Mistakes and Successes

 Whether or not you’re a new entrant to a given market, it’s important to learn from those already within your existing market.

To give you an example, when I first entered the Facebook desktop chat market with Chit Chat for Facebook I was acutely aware of the fact that the market already had one established player. At the time, they were not marketing their product effectively as their name had no effective meaning and the software wasn’t programmed to work without dependencies. By way of independent research as well as reading third party reviews I was able to learn from my competitor’s mistakes and successes in order to push them out the market.

Since then of course, Facebook have joined the party and released their own Facebook Messenger.

 The Competition Are Not Ignoring You

Rational business leaders will do their homework on competitors within a market place to appreciate where they are able to gain a strategic advantage, strategically aware competitors will analyse your areas of weakness and strength in order to understand how to best “attack” your business to take away market share.

As the old age saying goes, keep your friends close but your enemies closer.

 Markets Move and Evolve

Though we like to think that our business will be around for ever, in this economy even brick and motor businesses with hundreds years of trading legacy are finding themselves under severe commercial pressures due to changing attitudes and opinions as well as decreasing consumer disposable income.

If you don’t keep track of the changes happening in your market as well as the wider economy, particularly in technology, then you’re going to find yourself losing market share very quickly.

Indeed, in Western Europe and North America the traditional family owned coffee shops are largely being swept away by multi-national chains and franchises that are offering a premium experience. Small firms that have adapted rapidly have remained; others have been annihilated from the high street.

 If You Can’t Beat Them, Join Them

When promoting it can be very hard to gain traction in the marketplace – firstly people don’t know how you compare to the alternatives and secondly you have a lack of credibility.

It can often pay to encourage independent reviews reviewing your services independent and in comparison to your competitors. Such reviews not only stimulate credibility, but they and also starts to eliminate the information opacity as to your position in the market place.

For example, at the moment I’m in the process of promoting my Facebook cover designer utility – I am very aware of the competition in this cover market place particularly with sites that already specialise in providing pre-made timeline profile covers. When promoting I attempt to point out what the competition offers (pre-made covers) and what I offer (input in the design process) to ensure that I cater to the market that is most interested in what I have to offer.

Information opacity and uncertainty is a barrier to custom.

If You Can’t Join Them, Beat Them

I’m sure that as a child you found that there were some people that you were just unable to play alongside. Often there are instances in business where not only is it impossible to reach a strategic deal, and it being unable to promote yourself alongside a competitor but that competitor is a threat to your business.

In such instances, it often pays to understand what the competitors marketing mix is and how you can beat them at their own game. It’s better to be better than them in one area, then worse than them in all – Avis car rental “We may be number two, but we try harder!”