‘Iron sharpens iron’ as the saying goes

NBAL

The worst thing a business person can do is rest on their laurels. When that happens, running a company becomes an uphill battle, fending of competition the entire time. Before they know it, aggressive rivals have quietly crept into the vertical and eaten into the copious market share their marketplace once held.

As counter-intuitive as it sounds, there is actually a positive side to the much-dreaded rivalries entrepreneurs encounter. WIth a bit of thought, it’s fairly easy to see the silver lining of stiff competition.

Bring your A-game

When the rubber hits the road, it comes down to giving everything or giving up. As with our natural defense mechanism, competition is a case of fight or flight. At this juncture, business owners don’t have the option of turning back and are forced give it their best shot.

More often than not, we just need a little trigger to set the ball rolling.

Knowing that the competion snapping closely at the heels will keep anyone on their toes. This keeps complacency at bay and prevents it from chipping away at the drive to make further improvements to the product. In other words, competition serves as an impetus to sharpen one’s focus on the startup.

In all, it coerces Founders to buckle down and up the ante in order to hold ground against the rivals. When there is no room for judgment lapses and slip-ups, the company is free to move onward.

Spread awareness of your company’s niche

If the startup is a first mover, it is bound to garner attention, but perhaps not widespread enough to pervade the masses. Granted that competition can diminish the portion of the pie, a smaller portion could still mean more customers as the entire market grows.

Also Read: Funding update: Nodd, VoLT, Awesummly

In addition to that, having a few companies catering to the same specific market allows a wider network in which to leverage as more users become educated of the niche market. This generates even more traction and the perfect scenario would result in the company upending the traditional sector.

Before Carousell burst onto the pre-loved items marketplace scene, many of us used blogs to sell our second-hand items. When Carousell first launched, it was overwhelmingly well-received by young and budget-conscious students looking for cheap thrills.

Who knew selling used items can be as easy as snapping a picture and having it sold within a few minutes?

Seeing the opportune moment in capturing greater market share in this vertical, others have also jumped on the bandwagon in creating marketplaces similar to Carousell.

Shoppee and Snapsell have also joined the ranks of Carousell for easy buying and selling on their respective marketplaces.

While they take parts of one another’s market share, all the major mobile P2P marketplaces help one another by making the ‘lifestyle’ more widely used in the day-to-day lives of the average person.

Spurs innovation

At the first touchpoint between a customer and a marketplace, many would question the difference in using the startup as compared to others. Answering this question with conviction and selling the customer with the unique proposition is an incredibly valuable learning coming directly from the competition.

Also Read: Leveraging the on-demand economy: Lessons learned from Uber

Facing competition from rivals has the potential to spur further innovation — so to stand out from the rest, Founders end up scrutinising every step and feature of other rival marketplaces.

In essence, rivalry serves as a springboard for innovation, possibly creating a comparative advantage over the peers.

A deeper layer of understanding into the business

We all learn from mistakes, but not just from our own. Instead of following the footsteps of our competitors’ failures, we can learn from their mistakes. Not only does it allow us to evade preventable and costly mistakes, it also allows us to gain acute insights, which enhances our understanding of the business.

“The early bird gets the worm, but the second mouse gets the cheese.”

In those exact words of Willie Nelson, the widely acclaimed American musician and actor, he puts across effectively the importance of learning from the mistakes of others, in particular the competition.

Competition need not be a deterrent to any startup. In fact, it is far more beneficial for us than we may intuitively think.
—

About: Carrie Er is a Marketing Communications Specialist at Arcadier, a SaaS company that powers next generation marketplace ideas. You can follow Arcadier on Twitter, Facebook, and LinkedIn for the latest insights on the Sharing Economy.

The post Why competition is a good thing for your startup appeared first on e27.