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Breaking Into An Overcrowded Market: Is It Ever A ‘Sane’ Decision?

“If you come in late, you have to have a bloody good reason for the consumer to switch”

-Tim Ambler

The New Norm: Supply Exceeds Demand

We’re all scre*ed.

Yes, even you. Your ex-boy/girlfriend was right!

In case you’re wondering, I am of course talking about startups…

Whaaat?

Well, kidding-aside, here’s the thing – despite in which industry you’re about to enter (as a new startupper) the story is pretty much always the same:

The supply of products exceeds demand.

Put differently, unless you’re going after a brand new market category (which statistically speaking is more the exception than the rule) you’ll have to face an overcrowded market.

Yep, a market packed, big time, with competition!

And for some, that alone is kind of deal-breaker…

Why I hear you ask?

Ok, let’s start digging.

Is Entering A Crowded Market Worth The Gamble? NO

So, why many suggest entering an over-saturated industry should be a non-option?

A couple of reasons:

Reason #1: It makes it much harder to make it

The underlying assumption here is straightforward.

Unless you have a completely unique good (or alternatively something which is WAY BETTER than what is currently out there) attracting people with the will to even give you a chance becomes almost a mission impossible due to the myriad of rival offers.

The bad news?

You probably don’t have that product.

Or at least that what the claim is!

And for driving that point home, the advocates of this school of thought, back-up their claim with a bunch of, wait for it…

…startup failure rates statistics.

Love them or loathe them, are here ‘to tell the truth’.

I know, sad isn’t it?

Reason #2: It makes it much more expensive to break through the noise

That’s right – if shrinking (success) odds were not bad enough the increased marketing costs come to make things even more miserable.

And this is only natural!

Why is that?

It’s simple – one of the biggest challenges for new products is attracting the attention of the right people at the right time and…

with a market packed with competing products,

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