Competitive analysis for your startup ideas: why, what, and how?

#Eliminate the risk of launching the wrong idea

Everybody likes the business idea they have come up with. When a particular business idea is stuck in your head, you become obsessive about it and that excitement refrains you from seeing the possible flaws it can have. It is, therefore, necessary that the idea has been verified and tested with at least a few customers in order to check it’s viability.

#Check for the demand

Ensuring that the product or services you are going to launch in the market has real demand gives you the opportunity to improvise your product. Checking on the customers’ likes and dislikes will also help in changing the display or features as per the customers’ likings. You must check what your potential customers could need and what are their pain points to which you can provide solutions.

#Try to sell the product

Before launching the product in the market, if the start-up idea is sold to at least 5-6 customers the viability of the product can be easily measured. By selling your product to customers you will also be able to identify the future requirements and the flaws in your current model.

#Reduce cost

Idea validation minimizes the cost because you won’t spend your money and time on your entrepreneur ideas that won’t be profitable. If the idea doesn’t have a good customer demand then there is no point in fueling the energy in that direction at all.

Step 1: Clearly define your problem statement

Identify and define the possible problem clearly instead of trying to get to the solution. Write down the problem, keep it simple and to the point.

For instance –

• A door-to-door grocery facility is not available for your customers.
• Design professional graphics for social media

Step 2: Determine the level of problem

There are many problems that could be identified but it is necessary to identify a problem that comes as the biggest pain point amongst the top 3 that your customers are experiencing on priority. In order to learn the gravity of the problem, you must ask certain questions before heading for the next step, like:

1. Do they have a problem? If yes, how serious is it?
2. What are they doing to solve the problem?
3. Will they be willing to pay for the solution?

Step 3: Properly determine existing solutions

After talking to your potential customers you will definitely get an idea about the thought process they have, the kind of solution they need, and which company or products they look up to. You need to gauge their references. For instance, are they quoting or talking about a brand or a popular product? You need to identify where there is already a market and the loopholes of that particular market.

Step 4: Identify pain points in the existing solution.

You must understand the user’s perspective of the product they are using or have used in the past. Try to identify what they are missing out on? Look for cues like, is there a chance to compete with the service the product is providing? You should be able to draw a clear comparison between their product and your solution. Your product/service should provide at least 3-4 added advantages against what your customers are currently relying on. Look for answers like is there an opportunity to resolve a problem in an easier way.

Step 5: Verify your budget

Checking that the product you would be launching will have buying customers is necessary to decipher. If the idea fails to generate funds, there is no point in going forward with the product. You will come to know where to invest your money and what idea will work out the best where people will be willing for the solution they are getting.

Step 6: Leverage prospects to define roadmap

Now that you know people will pay for the problem you will be solving, there is already a prospect base that you have built. Leverage this prospect base to discuss the kind of wireframe you can build, the design, what could be the features of the product, and more such things to develop a holistic solution that your future customers would completely rely on.

Now that you have validated your idea, how will you start implementing it? Here is how to go about it.

#Build your prototype or test service

Once you have the idea there is no need to rush. Take a few weeks to gauge which idea really comes across as the best one and sticks to your mind. Now once you are clear about the idea, build a prototype of that idea to show it to people to get authentic feedback.

#Create MVP

Build a Minimum Viable Product (MVP) which is the basic form of your business idea that you can actually sell to a target audience. By using the Lean Six Sigma principles, the basic product can be tested and marketed in the initial stages of the development so that the resulting product aligns with the requirements of the target market.

#Run the idea through critics

Share your idea with or take a survey from your potential customers to check if they can really relate to the solution you are providing against the problem they are facing. This way you will get to know if serving your idea will solve their priority problem. Try and find people from your own group, peers, or acquaintances that can form a strong opinion about the selected idea.

#Make the idea suitable by tweaking

Changing the product to suit the target audience is the best way to make the idea a success. Once you have run your idea through the target market, tweaking it in the initial stages could prove to be highly beneficial to increase the success ratio of your product.

#Capture the audience

To increase engagement and gain traction from your target audience, try creating a simple website and social media handles that your customers can refer to their peer groups. This way it will be possible to gauge how many people are interested in your product and what reviews they have.

# Execute your marketing plan

If you have built a product, you need to market it to check who is interested, what strategies worked and what not, what you can do to improve your product. Doing so will help your business idea to get off the ground and in the process, you will build a greater audience by connecting and engaging with more people than you had connected in the initial marketing stage.

#Experiment with your idea

Experimenting the thought process makes you commit mistakes. This helps you become more welcoming to failures and adopt changes easily. Before your idea comes to fruition, you will be able to have clarity as to what could be the future strategies and what will suit the target audience with their evolving demands.