One of the hardest things about getting a great foothold in your niche is by getting ahead of the competition. If you can beat your competition, you can dominate your niche and greatly boost your revenues.
However, competition can be extremely difficult, and most business owners often wish their competition never existed. Obviously, that’s understandable. With less competition, they have the whole market for themselves and they can be assured of business success.
Surprisingly, however, while that’s understandable, it’s actually not the best for your startup. In fact, in order to get your startup to pivot faster towards success, you really need to have a good level of competition.
Today, we’ll show you the five reasons competition will lead your startup to greater success.
Competition stops complacency
Complacency can be a difficult to overcome, especially when success is achieved early on in a startup’s life. Complacency comes around when you find something that works and stick with it.
This means you can double down and be sure of the successful products or services. You know your customers are there and soon you adopt a “if it’s not broke, don’t fix it” attitude.
This is not good for your business, your customers or yourself. This type of complacency is the cause of death of so many businesses, including the brick and mortar and taxi industries, thanks to eCommerce and Uber.
With great competition, however, you are pushed out of your comfort zone and forced to look more close at your products or services, your business structure, marketing, customer service and more.
When you are on your toes, you become a better business and your startup will succeed more quickly.
Competition spurs innovation
Being on your toes doesn’t just help you fix the broken parts of your business, product or service, etc. It can also help you to find newer and better ways to deliver those goods and services.
With the right amount of competition, you are forced to provide your customers with something better than what your competitors are offering.
This could be in the actual product or service. But it could also be in the delivery, the marketing, customer interaction or many other parts.
Innovation is the lifeblood of successful businesses, and it’s the reason Airbnb and Apple are such huge successes. If those companies had no competition, they would have much less innovation.
Competition allows you to avoid mistakes
Another great thing that competition allows is for your startup to avoid the mistakes of your forebears. Essentially, your competitors will be trying many different tactics and strategies in order to boost their success.
These may very well be strategies and tactics that you would have ended up using as well on your startup journey. However, by studying your competition, you will see which things worked for them and use that.
And, very importantly, you will see what didn’t work at all and avoid those. That means you are saving yourself the headaches associated with the bad or untimely strategies that could have deeply or irreparably impacted your startup.
And now you can skip right over those mistakes, thanks to your competition.
Competition lets you know you’re on the right path
How do you know your business idea will be a success? How can you really be sure that this path that your startup is on is not only good for your business, but also something that people really want?
One simple answer: competition.
If your market is void of any serious competition (with such a competitive, globalized world we’re living in), then that could mean something is wrong.
This wrong thing could be that the niche is extremely difficult to find customers for. Or it could be that the products are too expensive and that the profit margins are impractically low. Or it could be for any other number of reasons.
However, if you have a healthy dose of competition, the opposite is probably true.
There are lots of customers, the products have great profit margins, and more importantly, there’s lots of room for newcomers.
This helps to let you know that you are in fact on the right path and, with the right business strategy, your startup has a good chance of success.
Competition forces you in your customer’s shoes
Perhaps related to complacency, competition will force you to think about how your customer experiences your products or services.
This is because you are constantly on the lookout for advances that your competition is making. If you want to hold onto your market share or increase it, you will need to stay a few steps ahead of your competition.
This means that you will have to understand the areas your customers love about your business model, and the areas that need work.
This could be in your pricing strategy, your customer service personalization, customer acquisition and retention, marketing, and of course your products.
Instead of looking only at your profits, competition will force you to consider what’s best for the customers, which will eventually be best for your business.
Competition doesn’t have to be a death knell for your business. In fact, it is one of the causes for why your startup will survive in the first place.
With greater innovation, perspective, strategy, focus, and the right amount of competition, your startup will surely be a success in no time.