Your Product & Competition, knowing these metrics will help in determining the profitability of product in the market place.
- Does your product have longevity in the market?
Internet consumers are more discerning when it comes to products they come by in the worldwide web. One factor that may influence their choices is the long term viability of your product. Your product may be obsolete in a year’s time. And your market does not want that.
When the term “programmed obsolescence” (where many electronic products were found to be specifically designed to be replaced by newer products after a short while in the market) came about, many consumers were disenchanted with their gadgets and started buying less and less, with the idea that a new product will be out in a few months and it would be better to wait it out. Assure your niche market that your product will last a long time, and prove it, and they will consider you and your product worth their while and money.
- Competition Analysis – An In-depth Discussion
In focusing on a specific niche market, aside from getting to know your market, you also have to know about the presence of competition and how they fare in your shared market. How these competing companies and products perform is a likely model of how your own company will fare in your chosen niche market. Here are some guidelines to determine the profitability of your niche market by studying your competition (or lack of it).
- Research about the Presence of Competitors in your Market
Are there any other companies in your niche market that may be considered competition? How many of them are there? The lack of competition may sometimes mean that your target market may not be profitable in the long run. That may be the reason why there are no companies targeting that particular niche. The market, perhaps due to its low population, is simply not enough to sustain the existence of the companies’ products.
On the other hand, a huge number of competitors in a given niche may also mean that the market is already saturated, and it would be best for you to look for other, less competitor-dense markets to focus on.
- Gather information about your competitor
Once you have determined that there is indeed competition in your niche market, although not enough to force you out of the playing field, know more about them. Compare your services and prices with theirs. What may be your key advantage against your competition? Are you priced lower than them? Are your products superior than theirs? What makes your competition stay where they are and not look for other markets? All these facts and information come in handy when analyzing the profitability of your niche.
- Know How Profitable it is for your Competitor in your Niche
Analyze your competition’s popularity over the internet by using widely-available programs and software. These software measure the volume of internet traffic that pass through your competitor’s site. The higher the traffic, the more profitable it seems to be for your competition. It would also be smart to measure the probability of your competition appearing on top of search engine results whenever a keyword related to your product is in-putted. That way, you can measure the chances your product will be chosen over his.