I talk to too many innovators who have moved past the ideation stage without surveying the marketplace. In fact, once you start playing with a business idea for a new product, service, or business, looking at the competitive set should be one of the first things you do.
I’m not saying that if you find any competition, you should call it quits. To the contrary, there’s often room to build off existing alternatives. However, you need to understand those alternatives. Studying the marketplace can give you an edge in terms of designing, positioning, selling, marketing, and distributing your goods.
To help you with your research, here are some tools and tips for scoping out the marketplace.
The Internet is a marvelous tool, but make sure it’s not you’re only one you’re using or that you do a cursory search. In fact, there are multiple avenues that you should explore on the web:
Use several search engines. Make a good list of alternative terms for your search. Try searching both general web and news—even an image search can pull up interesting results. Set up a Google alert so you’re continually updated about new developments.
Relevant business and industry news sites will give you analytical and competitive information, statistics, trend analysis, links to related articles, and reader comments that can broaden your understanding and lead to new sources.
Retail sites offer info on specific product or service offerings, pricing, features, positioning. If you’re looking to license your invention, it can give you an idea of who to pitch to and how. Perhaps most importantly, you can read customer reviews, which might give you a lead on innovation opportunities.
Forums let you eavesdrop on your target market discussing their need, what they use to address it, where they buy, what’s lacking in alternatives, etc. Lastly, crowdfunding, trend, and designer portals show you what’s still in the making. And with crowdfunding campaigns, you gain the additional insight about how consumers are responding.
Patent records are readily accessible either via the Upsto.gov site or the more user-friendly Google patent portal. While patent write-ups can be dense, you can get quick overviews from the summary, claims, and images. Citations are useful too, if you want to check out related intellectual property.
Physical Marketplace Research
If you’re innovating something that is tangible, go shopping at multiple locations. See where and how products addressing the same need are shelved. How are they positioned, packaged, and priced? What are key benefits and features? Who has prime and dominant space—and who might welcome more firepower? What gaps in existing offerings do you see? Also, speak to friendly store managers and even stock people. The more experienced ones will know what moves and why.
Talk with consumers who have the need and are either buying or not buying a solution. These should be discovery sessions with your target market, where you’re listening and learning—not selling.
Smart innovators know that a market study can be an education and inspiration, helping them fill a real gap with a solution that can compete.
This article has been edited and condensed.
Mike Collins is the Founder and CEO of Big Idea Group. He began his career in venture capital with a four-year stint at TA Associates, but soon found his calling as a serial entrepreneur. He has launched multiple businesses, including innovation consulting firm Big Idea Group, hedge fund Disruptive Capital Performance, specialty retailer Kid Galaxy, home improvement manufacturer Rebound Driveway Marker, video production company IQ Communications, digital recruiting firm NextHire, and others. He has also personally invented several successful products in fields as diverse as hardware, home goods, and toys. Collins has an MBA from Harvard Business School and an undergraduate degree in Engineering Science from Dartmouth College. Connect with @bigideagroup on Twitter.
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