According to the Global Entrepreneurship Monitor, 63% of companies in Panama compete in saturated markets.
To be precise, 63% of businesses compete in highly competitive markets, 28% compete in markets with little competition and only 9% of businesses compete in markets with zero competition. With these numbers, perhaps you should write an article about how to look for opportunities in underserved markets. However, this article is for all those entrepreneurs who have already launched (or are about to launch) in a saturated market. Because you do not have to be afraid to enter to compete in a saturated market but you must know what you face to compete effectively.
The task of knowing what you face, becomes impossible if you think you have no competition. One of the most common myths that entrepreneurs believe is that their products are enough: novel, different, or efficient to separate themselves from potential competition. However, this type of thinking is not only too optimistic but also blind to the challenges and opportunities that position you in comparison to your competition, you can illustrate. To open your eyes and really understand the market that we sail, we must make a competitive analysis.
A competitive analysis is a tool through which you can evaluate your competition based on the characteristics and benefits of the products / services with which they compete. A competitive analysis is a powerful tool both for the development of products and for the marketing of them, since it allows you to understand where your product has deficiencies that you must improve or what are its strengths that you must make sure to market. To create your competitive analysis, you must create an Excel grid that allows you to visualize and compare each of your competitors. In the first column down, you must write “Features”. In the first rows of columns 2 – 10 you must write both the name of your company and the 7 or 8 important examples of your competition.
To fill the first column of “features” you must have information about your competition. You can visit their websites or make a “tour” to visit their commercial premises. For your competitive analysis to really work, you need the right information. Whether it is a real tour or visiting your web pages, you should make a list of the characteristics that each competitor has. TIP: Make the list apart and then neatly include each feature in your Excel box. The features will totally depend on the industry in which they work. To give you an example, I did a competitive analysis of universities. According to the information I found on their web pages, I included features such as: price, instructional model, number of students, duration of the program, size of classes, financial support, relevant materials for the 21st century, support to find a job, accreditation , social aspect.
Once the list of characteristics is complete, one should objectively assess who has which characteristics and which don’t. Place an X below each company that has the corresponding feature. When the picture is complete you could analyze details such as:
1) What is the common characteristic that all or most of the competitors have?
2) What is the characteristic of the market leader that does not have the rest of the competitors?
3) What characteristic does your product or service have, that does not have the rest and, would it help you to position yourself with a differentiating element?
4) Which feature is not meeting anyone (and why? Clients do not need it or is there an opportunity to be the first to offer it)?
After completing this grid you should be able to answer: Does your product / service offer more of the same or is it different enough to separate you from your competition?
To do this, you must be honest with yourself about what your business has and what does not. Only then will you have the necessary information to keep improving. If you are already competing or preparing to compete in a saturated market, prepare yourself properly.