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Saturday, April 23, 2011

Your Competitive Advantage When Starting a Business Online

It is really important that you give serious thought to what your competitive advantage is when starting a business online, and very often this is not given the amount of time or consideration that it merits. You need to be known for something that makes you stand out - otherwise you will be lost in the crowd.

A good example of this in the offline world is Avis Rent A Car. When they started they recognised that it was going to be very difficult to overtake Hertz who had very successfully tagged themselves as No 1 in their marketplace. Avis came from a different angle. They recognised that they could not say they were now Number 1 - firstly because they weren't, but secondly, it would have been no more than copying Hertz. So, they came from a customer perspective and declared their competitive advantage as - "We try harder"! This really resonated with customers and won them over. They did not try and compete head on with Hertz on size, they competed on service.

Why am I telling you this story? Well, when starting a business online you need to be clear about what makes you stand out? If, like Avis, you cannot be the biggest, then perhaps you can "try harder" than your competitors.

So, how do you find your competitive advantage? This is a brainstorming exercise and well worth doing because you need to understand what makes you stand out from the crowd. The starting point is you. Once you have the answer, then you can focus on how you can bring that to the consciousness of your target market.

So, what questions do you need an answer to?

What do you want your customers to think about you when they land on your site? How will they feel about you? Will they see you as helpful, or just another mercenary selling any old product? Do they see you as someone who cares?
What do my best competitors do and how could I do that differently, or better? How can I add value to what is already being done?
What are the benefits of what I do? I am talking about the customer here! What benefit will they get from landing on your page?
What are their "take aways" from my site? Is it really informative content? Are there helpful independent reports? What material is there that is free? Will they get free tips to help them build their business? Look at your site from their perspective.

One piece of advice - don't get put off by an idea that you see someone else doing. Look at it carefully and see can you do it better, faster, cheaper. Just find out what people are looking for and look for ways of providing it in a way that makes you stand out from the crowd. This will then form the basis of your competitive advantage when starting a business online.


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