Compete or create
You can grow your business by competing with other businesses in your industry to sell more of your product or service. However, bigger businesses are usually better at competing to get a bigger share of customers.
For example, a big business can order more units of stock at a lower cost, and then they can pass these savings on to the customer and offer a lower price.
If you choose to compete in this way, you run the risk that your product or service becomes standardised, and potential for profits and growth are reduced.
If you own a smaller business, you’ll probably have more success responding quickly to customers’ changing demands and tastes.
Some companies have created new demand by forming whole new industries, like Trade Me in the online auction industry. However, a more realistic and achievable way to create demand is to create new space in an existing industry.
Steps to create your own space
- Step01
Find out what your customers value
Discover what your customers truly want – different groups may value different things. Tailoring your approach adds value across your audience.
Start by asking customers why they chose your business, empathising with their needs, and exploring industry or customer data for patterns. Innovation can be as simple as combining current technology with customer desires. For example, a fresh food business might offer online ordering to skip queues.
Focus on unmet needs. While it’s helpful to observe competitors, don’t let their actions limit your strategy. Instead, aim to service your customers in ways others haven’t considered. By aligning with your customers’ values and finding gaps others miss, you can create a unique space in your industry.
Ask yourself:
- What do customers appreciate about competitors?
- How are competitors meeting those needs?
- Where are they falling short and why?
- Can you meet those needs better?
- Step02
Look for new opportunities within your business
Once you understand what your customers value, look at opportunities within your existing business. You don’t need to leave your industry to create space in the market – often, your current community holds untapped potential.
For example, offering a leasing option on a product typically sold outright could attract customers who prefer flexibility or can’t pay upfront. You can do this without changing your core operations – it’s simply a new way to deliver value.
Use our strategy planning worksheet below to capture these insights. Document what customers value, compare it to what you currently offer and brainstorm ways to extend that value.
- Step03
Add value and reduce costs
To increase product value while reducing costs, focus on what truly matters to your customers and remove what doesn’t.
Creating your own market space isn’t just about doing more – it’s about doing better by cutting unnecessary costs and offering something unique. For example, a bike part manufacturer might shift from offering bulk discounts on parts to opening a bike service centre.
Competing directly often forces trade-offs between price and performance, but a fresh approach lets you sidestep that, attracting customers willing to pay more for simplicity and originality.
Adding value in one area may mean reducing or removing something customers don’t really need, helping you balance costs effectively.
- Step04
Stand out from the competition
Compare your business to others in your industry by looking at key features of your product or service – like price, quality, speed, and service – and how they stack up. If you’re offering similar value across the board, you’re likely in direct competition with others.
To stand out, consider adding a unique feature that your customers care about. For example, introducing ethical sourcing could create a clear point of difference, giving you an edge even if most of your offering remains the same. It’s about finding small shifts that add meaningful value.
Think about what your industry typically competes on, where you sit, and what new feature could set you apart. Then use your strategy planning worksheet to explore those ideas.
Ways to increase the value of your product or service
Get rid of something
Look for elements in your product or service that could be eliminated – even if they’re standard in your industry. For example, you might remove your long and varied restaurant menu and promote a fresh new dish of the day. A shorter menu can reduce costs, save time, and attract customers who value simplicity and speed.
Do something better
Identify what you can do much better than your competitors. Small touches, like for example, if you offer a pet-sitting service, sending pet updates during the day helps build trust with your customers.
Add something new
Introduce a unique feature that adds unexpected value to your customer experience. For example, if you own a car workshop in the city where most customers leave their vehicle to be fixed during their workday, you could offer to drop their car off at their office at the end of the day. You’re offering something new that enhances a customer’s experience in an unexpected way.
Downgrade something
Scale back less critical services to cut costs without sacrificing overall satisfaction. For example, you typically provide customer service via a call centre. If you’ve increased your social media presence and engagement, you could ask your customers to use those social media channels for enquiries.
Check your locations
Review and adjust where and how you’re selling. Consider whether to add new locations or move away from old ones. It’s common for businesses that start on a shared marketplace to later create their own website. Online, in store or both – choose locations that maximise reach, costs and enhance customer experience.
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