I have an idea for a business, but there is already a lot of competition. Do I need to find a new idea?
The fact that there is a lot of competition in the industry you're about to enter is actually a good sign.
I do some angel investing, and I get a little nervous when people say there is "no competition" for the idea they are proposing. The market has a funny way of sorting out the good ideas from the bad, and if there is no competition for your idea, chances are, there is no market either.
Companies' succeeding in doing what you're proposing is a good sign—the market has validated the core of your idea. Instead of reinventing the wheel, all you need to do is take a concept that is working and find a small corner of the market to dominate.
My friend Verne Harnish defines strategy as simply finding something that meets two criteria:
1. Customers care about it.
2. It makes you unique.
Is there something a segment of the market cares about that you can stake a claim to?
When Panasonic wanted to enter the crowded laptop market, it surveyed the landscape and saw Apple owned sexy, Dell owned direct, and HP owned innovation. Someone had already staked a claim to the big things customers cared about when buying a laptop, but there was a small segment of customers who wanted a laptop to be rugged above all else. Police forces want their officers to have laptops that can stand up to the rigors of the inside of a squad car. Traveling salespeople need their laptops to withstand the punishment of airport security. So Panasonic found a small but profitable niche in developing ToughBook—the most durable laptop on the market.
Think about the competitive market you want to enter and, like Panasonic, find an angle. Richard Branson entered the hyper-competitive airline business by launching Virgin Airlines when he discovered there was a group of customers who wanted good but unpretentious service yet weren't getting it from stuffy British Airways.
Branson didn't shy away from the market because of the competition, but he did find an angle customers cared about that could make Virgin stand out in a crowded market.
John Warrillow is the author of Built To Sell: Creating a Business That Can Thrive Without You, which was released by Portfolio/Penguin on April 28, 2011.