I think this is really interesting.
First, can we agree that competition is generally a good thing for a bootstrapped business? Especially well-established competition that is doing a good job of educating the market.
There are many examples of startups entering an established market with existing solutions. Those existing solutions—on the surface—would seem to solve the needs of the market, but yet the newcomers find an audience.
-
Google entering the search market dominated by Lycos, Altavista, and AOL.
-
Duo Lingo entering a language training market dominated by Rosetta.
-
Drip entering a crowded email marketing automation space dominated by MailChimp, AWeber, ConstantContact, and InfusionSoft.
-
MindMeister entering the mind-mapping/flowcharting toolkit space dominated by Microsoft Visio, OmniGraffle, and others.
-
Teamwork competing with Basecamp in the project management space, also crowded by Zoho, Jira, Asana, Microsoft Project and others.
-
Close.io entering a more-crowded-by-the-day market dominated by one of the original SaaS giants, Salesforce.
-
We already had Hootsuite and Pluggio, why did we need Buffer?
-
Draft creating a distraction-free writing app in the crowded word processor space, dominated by giants like Microsoft Word and Google Docs with orders of magnitude more bells and whistles.
Need I go on?
Personally, I LOVE the idea of keeping an ear to the ground for customers that feel they have a need that perhaps a new startup can solve.
Why? Aren’t these just distracting, shiny objects?
I don’t think so.
Take the hairdresser example. If only as a research and validation exercise.
To become a licensed hairdresser, you have to get training. In those training sessions, in that school, you meet other hairdressers, estheticians, beauticians, stylists (whatever they call them). And as a working hairdresser, most of the time you’re working in a team environment with other hairdressers. You then would have to assume that these people, in a people-centric industry, find time to talk and share tips and tricks, and share resources that are helpful. Right?
I find it odd, then, that in this person’s interactions with other members of their hairdresser industry they’ve not come up with an app, service, or publication that satisfactorily solves their problem.
(bear with me, this is where the thought experiment unfolds)
If the above is true, then it follows that either:
- No adequate app, service, or publication exists that fulfills this need, or
- No app, service, or publication is known to fill this need. Meaning: no app, service, or publication that solves this need has made themselves known to the target market sufficiently through organic (here, probably word of mouth referrals) or paid channels to saturate the market enough that this particular hairdresser knows of their existence.
So, either no solution exists, or, one exists but is doing a terrible job of marketing.
Or, a third option: It’s the hairdresser’s fault for not doing a thorough search. Perhaps, this hairdresser is just doing a bad job of staying up-to-date in their own field. Maybe they’re just bad at The Googles. That’s easy to test, as well.
This is the next research step, in my opinion: Catalog what exists that would serve this need. Then find out why this person may not have heard about those solutions.
If nothing exists out there today that would solve this need (and I would be shocked if that’s completely true), then that raises some questions and concerns. Those questions would need further research, such as: perhaps no one is willing to pay to have this solved? That question is easy to validate with a combination of a yellow pages, a telephone, $50 in Facebook ads, and a landing page.
Next, if something fills this need and is rather successful, but are doing a poor job of marketing, that means they’re vulnerable to someone more savvy at marketing. Emulate what they’re doing right, eat their lunch with better marketing tactics.
If other solutions exist that don’t adequately meet the need, AND they’re not doing a good job of marketing, then this is a business that is ripe for further validation. Because we still haven’t asked the crucial question: how many others are eager to pay for something like this?
And so on.
Even if you’re not looking to start something new, and you’re completely focused on your existing business, I feel that the mental exercise of thinking through how one might go about validating a new idea is valuable to your own endeavors.
This exercise sharpens your skill of knowing how to find and ask the correct questions, in the right manner, in the correct order. Like other skills and talents, this skill of critical thinking—of rigorously forming and testing hypotheses—can atrophy and fade.
It’s not just a business skill. It’s a life skill. Make time to keep it sharp.
