Not all new ventures have the skills, expertise or funding source to develop breakthrough products like Tesla Cars, iPhones or Instagram. Many of them have to contend with incremental innovation in the existing products or creating a differentiation in terms of pricing or new features that appeal to a particular section of customers.
These tactics may be useful in generating sales in the short-term. However, to thrive in a hyper-competitive market, you need to have a sound differentiation strategy that attracts new as well as repeat buyers consistently.
The most crucial element to succeed in a highly competitive market is the “Focus.” It is something which is common in the most promising startups across the world. The startups which became giants focused on one thing at a time – they built a basic version of a product, service or a platform that solves a fundamental problem and reiterated the offerings to create a unique and unparalleled product.
You too can turn your small business into a big organization if you contain your urge to do a lot of things that help only in short-term but become counterproductive in the long run. Here is how focusing on one thing at a time can ensure success despite stiff competition:
“Any product that needs a manual to work is broken.” – Elon Musk
Many founders kill their startups by creating a complex product which tries to solve a lot of problems. Doing many things at a time not only distract the management but also drains resources.
Focusing on solving one problem at a time will help you conceptualize a superior product. You can use the entire resources at your command to make products that surpass the customers’ expectations. Understanding customers’ pain point and addressing their concerns through a continuous up gradation of offerings will lead to an incremental innovation which in turn will help you build simple products that customers love. It will give rise to a sustained competitive advantage for the organization in the long run.
The companies that focus on doing one thing really well tend to create superior products. They use the power of incremental innovation to meet customers’ stated and unstated needs. It results in a win-win situation for both – the customers as well as the companies. The organizations will also have enough resources to promote their value-added offerings and position themselves as a trustworthy partner.
The customers will be happy to pay a premium price for the value they get from the products or the brand they love. The ability of an organization to charge a premium price without losing on the sales reflects its brand value. It makes the company more profitable and competitive.
Financial strength plays a crucial role in an organization’s growth. In fact, many startups with promising products and a sound business model fail due to lack of adequate funding. If you operate in a highly competitive industry, then very few investors will be willing to invest in your organization. Since competitive industries offer a tremendous opportunity to almost all types of business, you can’t ignore the business just because you lack funding.
Rather, you need to build a profitable business model that ensures sufficient liquidity to grow the business. Focusing on niche products or services will be of immense help in generating higher margins required to spur the growth, especially at uncertain times. It also increases your risk appetite and provides you an excellent opportunity to adopt a bold strategy to accelerate your business growth.
If you want to succeed in an immensely competitive market, then you need to starve your distractions and continuously feed your focus. Believe in yourself and take the steps mentioned above to take maximum advantage of exceptional opportunities offered by a highly competitive industry.