Tip# 2: Do your homework and study competition

“Some of the best ideas in business have been copied from competitors. By taking the time to study their ads, brochures and promotional materials, you can improve on what other companies offer.”

It’s a common belief that the critical component to creating a successful startup is having a unique, spectacular idea. Many of the success stories we hear about the uber icons of entrepreneurship are based on bringing a new idea to market. These examples tantalize the hopeful and get us to obsess over the perfect original idea that the world is waiting for, and to believe that our fame and fortunes are waiting to be born from this fantastic concept.

What is forgotten are the many competitors that spurred these geniuses to action, pushed them to think outside the box, and had products of their own that did not survive the test of time in the marketplace. We all know of Thomas Edison, but his competitors whose work helped him perfect his ideas are long forgotten. His most talented rival, Nicholas Tesla, died broke and obscure. But it was Tesla whose technology was superior and he constantly forced Edison to innovate in order to maintain his top position in supplying the world with electricity.

In Chapter 3 of the Guide to Low-Cost Startups, we focus on the importance of using market research techniques to gain a serious understanding of your competition.

No idea, no matter how original, is without some kind of competition in the marketplace. And the more thoroughly you understand your rivals, the better you can differentiate your company, brand and products.

Your “homework” will yield many benefits: sharpening the focus of your Vision, improving your marketing strategies and accelerating the pace of your market penetration.

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