Thinking About Competitive Analysis
Competitive analysis is a key aspect of the discovery process and determining if your idea is actually a business opportunity. Before we get to the how to, I’ve got a few “Just Because” rules you should keep in mind.
1. Just because you have never heard of the competition doesn’t mean no one else is doing it. Dig deep. Ask around. If your Google-fu isn’t that great, enlist a friend to help.
2. Just because there is competition doesn’t mean you shouldn’t do it. In fact, competition often is a strong signal that a market exists for your idea. You just have to figure out how you’re different and how your solution solves the problem better than the rest.
3. Just because you can’t find any competition doesn’t mean there isn’t any competition. This one is the most important and worth repeating. (Yep, go back and read it again.) Your competition is whatever people are doing to solve the problem now.
Example: You have a great idea for a disposable picnic set for people who have spontaneous picnics. You discover there isn’t anything like it on the market! So you’re all set right? But what do people who have spontaneous picnics do now? They generally grab napkins and utensils from the place they picked up the food and make do without plates. If they have to, they buy some plastic red cups. Is it a cute, romantic solution with plastic wine glasses? Nope. Is it really a problem that needs solving or does the current solution work pretty well? Current solution works pretty well = smaller market.
There are a lot of models and processes you can use to do competitive analysis. Here are some resources to get you started.