Are you an entrepreneur seeking to establish a business in an already saturated market? At first glance, it might seem daunting and unattainable, yet it is worth trying because taking business decisions that scare you the most will only help you grow.
Your decision should not be determined by just the saturation level of your intended market. In fact, to the determined entrepreneurs, the fact that the market is saturated is an advantage because – it’s a sign that there are opportunities in that market.
I had the opportunity to be a part of a Web development company. As a member of the team for the past four years, despite the saturated level of the industry, we have seen our stock rise in terms of number of clients and referrals.
So just before you begin to think that breaking into your intended niche is impossible, read to the end to find out the crucial steps that will help you break into any market.
1. Carve out and own your niche
The worst thing you can do to yourself as an entrepreneur is trying to compete with everyone in the industry. It is definitely the most assured way to run your business into the ground as quickly as it takes off.
The industry and your niche are two different things. Your competition exists in your niche, not in the industry. So focus your attention on your niche and see the whole industry turning their attention on you.
Operating in a niche helps to reduce the number of direct competitors to a more manageable number.
2. Offer greater value to your customers
Once you are sure that you are in the right niche, you can now focus on making products or delivering services that are distinctly different or better than what is already on offer.
Customers like options – make sure you bring something different to the table. We cannot deny that there are thousands of businesses in the same industry selling virtually the same thing. Notwithstanding, yet businesses join these industries year after year, make money and grow.
On closer inspection, you will always discover that the differentiating factor between them and prior businesses in the industry is not what they are doing, it’s how they are doing it.
We live in a world where consumers no longer ask, “Is there a solution?” Now they ask: “Which solution is better?” Thanks to the already available plethora of solutions.
Ask yourself. “What does your product/service provide that the competition doesn’t?” Then focus on that. When customers in your targeted consumer base see the greater value in your product offering, they will flock to you in droves.
3. Start as a franchise
Most people take this route if they do not have sufficient fund or other prerequisite resources to launch out and survive in a saturated market place.
What to do here is to find a name in your niche (not your industry) that is already established and get a license from them to operate your business in their name.
You are not yet your own company at this point so do well to abide by the policies of your parent company until you have garnered enough resources – financial and otherwise to pull out and operate individually.
A franchise, besides giving you time to build up resources, also affords you time to learn the ropes of the business, get much needed experience within the industry and build your own customer base.
In the short or long run, when you finally terminate the franchise agreement, it will not look as if you are starting from scratch. Rather, your organisation will look like an already established business undergoing a name change.
4. Have your finger on the ‘trend’ pulse
Many industries are not only saturated, they are subject to rapidly evolving trends. That is just the way it is.
Smart entrepreneurs always keep their finger on the ‘pulse’ of their niche. This way they recognise new trends in the industry whenever they come along.
One thing is certain; consumer demand is never stagnant. Consumers always want more. Making sure you stay up to date in your niche will help you keep your customers loyal.
If your customers begin to feel you are slipping into obsolescence, they will bid you farewell and jump ship to the next business that is operating in the ‘present’.
5. Collect a panel of experts
Much of today’s approach to advertisement continues to fall on deaf consumers’ ears. This is because most businesses use much of the same words and say much of the same thing when promoting their products or services, so much so that it all feels so mechanical.
People do not always trust brands. They trust people like them, people they admire and third party experts.
Gather a small group of trusted experts, who will organically vouch for what you have to offer. This strategy can increase your business revenue. This group can consist of people from any walk of life that genuinely identify positively with your product and believe in your brand.
Just make sure that each of these people have large network of followers – especially on social media. Combining their influence and reach can help ensure that your brand attains ‘household name’ status and a formidable authority in the industry.
This article was originally posted here on Entrepreneur.com.
How Netflix Is Now Disrupting The Film Industry By Embracing Short-Term Chaos
One wrong move and Netflix could have been nothing more than a footnote in the history of entertainment. But by staying ahead of the curve and embracing disruption, the company is threatening some very entrenched competitors.
Attendees of the annual Cannes Film Festival are typically not afraid to be vocal in their dislike of a new film — booing and hissing are both surprisingly common — but the recent film Okja possibly set some sort of record. The crowd was booing and jeering before the film had even properly begun. In fact, all it took was the name of the studio behind the film: Netflix.
Why the animosity? Netflix is disrupting the film industry, and the traditionalists aren’t happy. After debuting at Cannes, Okja wasn’t released in cinemas. No, instead it was released right to Netflix, free to stream as long as you have an account.
Of course, few would have guessed a few years ago that Netflix would ever get into the business of making its own television shows and movies. According to industry lore, entrepreneur Reed Hastings launched Netflix because he was annoyed with the exorbitant late fees of video/DVD store Blockbuster.
Instead of having to return a movie once you’ve watched it, he conceived of a business that would ship DVDs right to your door through the mail.
It was a clever idea, but not one that seemed terribly disruptive. The whole process could be a bit of a hassle, and it required you to schedule your entertainment well ahead of time. Blockbuster even had a chance to buy Netflix, but decided that it wasn’t worth it.
The rise of streaming
Even as Netflix was hitting its stride in the early-2000s, the tide was already turning. It was becoming increasingly clear that the Internet was going to be an incredibly disruptive force, but many companies failed to notice. Or, if they did notice, they failed to take adequate action.
By 2007, the potential of streaming TV shows, films, music and books online was clear, but the DVD business was still doing well. However, Netflix decided to prepare for the future (and disrupt its own operations) by launching a streaming service. It did this by going to the traditional movie studios and television networks, and asking to licence their old content.
In the view of these studios and networks, old pieces of entertainment had run their course, so they were pleased with the new revenue stream.
This brings us back to Okja. Netflix has been creating its own content for the last few years because it realised that studios and networks would eventually catch on. At some point, they would understand that they were giving Netflix the ammunition needed to disrupt the industry. Why have Netflix stream your content if you could create your own streaming service?
“The goal is to become HBO faster than HBO can become us,” Hastings said of one of the most popular American cable channels back in 2013.
In a mere 20 years, Netflix has gone from a low-tech operation that sends DVDs through the mail to one that not only streams content online, but is also producing its own content — content from some of the most respected actors, producers and directors in the world. All of this is costing Netflix hundreds of millions of dollars, and it remains to be seen if this strategy will ultimately pay off, but betting against Netflix is risky.
Netflix has shown itself to be uniquely capable in drastically shifting its business model. Here is how Hastings explains it: “Short-term optimisation about being efficient is the death of long-term success and innovation. Building Netflix, we created a company that tolerated some short-term chaos, and we manage right at the edge of chaos. The value of that is keeping and stimulating the amazing thinkers, so when the market shifts, like DVD to streaming, or licence to original content, we have in Netflix all kinds of original thinkers, and that is the long-term optimisation that all of us in organisations want.”
SME Leaders: How You Can Manage Growth
Fresh growth is all around us this Spring – find out how you can powerfully manage growth as you provide leadership to your SME.
In the transition from start-up to scale-up, a critical factor for a growing business is the quality and strength of its leadership team.
Learning to trust and empower staff is a crucial step for SME leaders who wants to grow their business upwards.
As a business grows, one of the biggest challenges for the business founder and leader is the hand-over of an idea from the founder to the people who work there, The brand moves from being one person’s idea to being the professional focus of a whole group of people.
Without effective leadership, small businesses will be held back, more than three-quarters of SMEs provide no leadership development for their staff. What does this mean for you?
If you lead your business with vision and clarity, you set yourself apart from your competition. Here’s how.
Lead the pack
A growing business creates more work than a leader can handle alone.
As the team grows, founders often react by micromanaging the details of their business. In trying to take on everyone else’s job, the founder often leaves the most critical position vacant: strategist and vision-setting.
Learn to trust and empower others in the organisation and you will find you have room to innovate, which is critical for business growth.
Steady the ship
An effective leader will also engage others in the business to embrace and adapt to change as growth continues.
- Vision: First, plot the course for where the business should go in the short term, and the long term.
- Change: Understand what needs to be put in place to grow the business. You might need to source better business operating systems to streamline this growth, or change a few internal business processes, or rethink how you calculate your hourly rates.
- People: Growth equals change, and change equals pain, so if you want growth, budget for pain. Understand that you will need to guide and coach the staff into changing their mindset and adapting to these growth changes.
We Went up Against A Highly Regulated, Entrenched Industry. Here Are 4 Tips For Getting Your Foot In The Door
Focus on creating value, not disruption.
Multibillion-dollar legacy industries don’t make it easy for entrepreneurs to step in and create value. There are huge barriers to entry – licensing, pricing, regulations, and cultural/brand significance – that come with being around for a century or more.
However, those barriers shouldn’t stop you from innovating.
Take the utility sector for example, which is perhaps most frightening of all: A trillion-dollar taxpayer subsidized network of poles and wires set up through franchised municipal monopolies. Otherwise known as, our power and energy industry. It’s a mouthful of protection, and as a result, utilities make for a great investment (just ask Warren Buffet), since the likelihood of disruption is tough to even think about. To most reasonable entrepreneurs, the regulated utility sector, similar to the financial and healthcare industries, is tantamount to a “NO TRESPASSING” sign.
But, that is exactly what makes the effort so worthwhile. If you can successfully work with or alongside a monolith industry and produce value, instead of being focused on “disruption,” you’ll be able to achieve massive results.
When we first started trying to provide consumers cleaner and better energy options, getting to market proved difficult as we were trying to break into a utility-customer relationship (paying a power bill) that hasn’t really changed for the last half-century. But, with a clear mission in mind and the understanding that we would have to work in unison with utility providers, we were able to start making our mark.
Here are a few tips for getting your foot in the door:
1Create value, not disruption
There are some industries where the Silicon Valley catchphrase “disruption” falls flat. Some industries just aren’t meant to be disrupted in the way that people in the tech community are used to. Nearly our entire economy depends on the power grid and we couldn’t come in and totally upheave that. When you’re going after a big industry, you first need to provide value to the customer or the provider.
Show instead of tell that you have a strong customer base and that people need what you’re offering. And build relationships – working together with the big players in the space will get you much faster and better results for your company and your customers.
2Focus on the customer experience
When you’re a startup, you already have the advantage of being years ahead in your digital experience compared to traditional companies in your space. Own that and hone in on it to make it the best customer experience possible. We looked across sectors to bring modern design, UX and data elements to the home energy experience.
Traditional companies aren’t necessarily thinking that way, and you’ll win people over by offering self-service customer tools, easy payment options and notifications they actually understand. Good communication with your customers goes a long way.
3Start small, build toward the vision
A lot of start-ups begin with very lofty goals – disrupting whole industries and changing the entire way a process is done. We certainly had a broad vision to be the trusted home energy advisor for everything from solar to batteries. But, you’ll never be able to achieve anything if you try to tackle everything all at once in a highly regulated and old-fashioned industry. Instead, to get started, focus on one thing.
For us, it was offering clean energy via renewable energy certificates (REC). By starting small, you’ll be able to learn about and understand the space you’re going into, and will be able to see if there’s a market for what you’re offering. As you learn, you can slowly expand step by step and tackle more complex products in the industry.
4Use best practices from other innovative industries.
No industry has a monopoly on good ideas, and the boom in direct-to-consumer brands across apparel, food, finance and healthcare provides a great roadmap for how to build a modern customer experience. Look to other industries that have been there and done it. For example, Mint.com has created an innovation through the consumer interface – in their case to manage finances – while leaving the existing banking and credit card infrastructure in place.
While the thought of breaking into an established industry is definitely intimidating, in today’s entrepreneurial environment it is definitely possible and innovation is desperately needed. Success depends on the ability to shed your typical idea of disruption, and stay patient and persistent.
This article was originally posted here on Entrepreneur.com.
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