Study the competition…

Most people who are planning to launch an e-commerce based business probably think that they have come up with a completely original idea, but in truth, it is highly likely that other people have got there before them no matter what your idea is.
However, you should not necessarily view competition as a bad thing, because without competition, you would not be able to establish what works and what doesn’t. The problem with being the first into a particular market, a pioneer, is that you are the person who is going to make all mistakes. On the other hand, if there are other people already on the market, they have made the mistakes for you, so you should be grateful for competition.
Competition also indicates that there is money being made in the business in which you are interested, and that is an extremely important consideration. While you do not want millions of competitors, because that might make entry into the market extremely difficult, if there are other people already doing what you plan to do, then you know that you are on the right lines, as there is money being made.
If you were to open a business in your local shopping mall, you would look at other competitors who are operating in the same local market, but if you want to start an online business you have to look at competition on a much wider scale. There are probably people in your business already operating all over the world, and you need to know what advantages and disadvantages each of those businesses has.
Research and analysis of what other people in your business are doing online is absolutely essential. While it might be a time-consuming process, it is necessary and time that is very well spent.
Imagine for example that you are thinking of starting a weight-loss industry business, so you want to research what other companies in the same sector are doing. You type the name of a well-known weight-loss


There are 14 million web pages that feature ‘hoodia’, and while many of these will not be pages from companies who are supplying hoodia based products, many pages are. These companies represent direct competition in your market, so find those companies whose names come up most regularly, and study their websites.
Look at the product range that a potential customer can access through their site, the kind of prices they are able to offer, what delivery terms are available and whether they are running any specific promotions.
Take the domain name URL of the top rated companies in your market and search to see what other information is available about those companies. This might help you to find out how they operate, who their target audience is, whether people are happy about dealing with them and the like.
Remember that the internet is a largely democratic place where people can say (or write) pretty much what they want about other net users, so you will find other people commenting and reviewing your competitors, highlighting both the good and the bad.
From this research, you should be able to establish one very important thing.
You already know that if there are competitors in the market, there is money being made, but your research should highlight the weaknesses of many of your potential competitors.
This is crucial because what you should be looking for is a point of advantage or a unique selling point that you can use to differentiate your business from the competition.
As a newcomer to the market, you have to be able to demonstrate to potential customers why dealing with you is a better option than dealing with more established competitors. After all, if there are already e-commerce enabled sites in the market in which you hope to make an impression, those sites already have customers.
Your job is to convince as many of those customers as possible to switch their business to your site, but you have to give them a concrete reason for doing so. Human nature dictates that people do not change unless for a very good reason, so you have to supply that very good reason, which is why you need a unique selling point that no one else in the market is currently offering.
It could be something as simple as free delivery if no one else is already doing this, or even if your competitors are already offering free delivery within 100 km of their geographical location, you might consider extending your free delivery boundary to 200km or even more.
Perhaps you could offer bonus products to customers who spend a certain amount of money, or offer long-standing customer loyalty bonuses.
Although having competition is a good thing, you have to differentiate your business in some way in order to be successful.