This is a continuation of the article, You Don’t Have to Run From the Online Competition, Part 1 where I discussed the Barriers to Entry.

Learn From the Industry Leaders

The industry leaders got to be the leaders for various reasons, but one might be that they know what they are doing. It is really amazing how much you can learn in any particular niche market by how the leaders of that market run their businesses. Find out who these leaders are and how long they have been involved in the field of interest. By no means should you ever just copy what they are doing and call that your business strategy (see be unique below). That may work for the white-labels in the grocery store but in the world of online business it can quickly make you the target of a more powerful entity, and your reputation will probably be a less favorable one in the long run. Learn, but don’t copy. Make a study of these companies and find out everything you can (legally) about who they are and how they operate. This will give you further information about step number one above and you may find you really can’t compete, or it may reveal a vacancy that needs to be filled. It will also give you some insight on what to prepare for in the coming months. Make a list and do some research. If you don’t do it on a spreadsheet, at least do it in your head. Find the top 10 or 20 companies you believe will be in direct competition with your plans. Write down what you think their strengths and weaknesses are and how you can improve on those weaknesses you find. Do a Google or Yahoo search and find out what you can. Not just the normal rigmarole, find those advanced search features and do as in depth of a search as possible and add to your list. There are many good tools online to help with competition research. Compete is a great resource for comparing the traffic on several different sites at the same time, and Alexa has a similar comparison for traffic. For auction research, Terapeak is a good place to start, and if you want some good basic notices, try Google Alerts to stay up to date with what is going on in the trenches.

Network with the Competition

Just because you are in competition (or even perceived competition) doesn’t mean you are going to be hated, should hate the other businesses, or even feel any animosity or jealousy towards the competition. That will probably get you nowhere and will just make you miserable. Develop some friendships, or at least acquaintances, with the competition. You might be surprised by the response. Several years ago when I got involved in an industry I knew nothing about, the first thing I did was go around to every business owner I could find and do a so-called informal meet and greet. Our business was product based, geared towards 10-20 national conventions a year, so getting to know the competition on a first hand basis was almost a requirement, and it worked. I am not going to say that they just handed over all their secrets but you would be amazed at how much information the competition will freely give out if you just stop and listen. With an online business this may be commenting on their blog articles, sending an email in response to something on their site, or even meeting up with them at a convention, like the upcoming Blog World Expo, and just introducing yourself and your company. I made some good friends with my direct competition and more often than not, you can help each other out when needed. So go network with the competition, if not for any other reason than to say, here I am and I am not going anywhere either. Do go in over zealous, you are an outsider to them and cultivating a relationship with another business is important, and takes time. Stay tuned for part 3… Coming up [ Scott Fillmer, a guest author for Allinanchor.com, is an online business owner and author of five blogs and you can find his site at scottfillmer.com ]