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Snooping On Competitors

I'm thinking about getting into a market as an (online) Application Service Provider.  There are already about 20/30 companies operating for this particular application - many of them are pretty similar. They nearly all operate by providing a certain level of service for free and then converting users into paying customers by charging for extra features or the 'pro' service.

I think there's a good chance I can provide an online application that is similar in many ways to many of these companies but with my own niche. I have a technology that I created for another purpose but that can be applied to this so it will be difficult for competitors to catchup/replicate what I'm doing.

What I really want to find out is how much these competitors are making - whether they are turning a solid profit or speculating on future returns. I want to find out whether this segment is already too crowded and what the total value is? The companies are all American LLCs, but I'm based in the UK.

Somewhat Anonymous
Thursday, May 6, 2004

If they aren't a publicly funded company, I imagine you're asking the impossible. If they're privately owned/funded, then they don't have to disclose their financials to anyone but the relevant tax authorities, and the tax folks tend to keep that information confidential.

Sgt. Sausage
Thursday, May 6, 2004

If they're privately held (under a certain number of stockholders -- I think 50 -- and/or revenues I think below $10 million a year) you're unlikely to find out, since it's not in their interest to disclose their figures.

You could probably estimate based on their number of employees, office building and likely rent, etc, to calculate overhead and salaries, and somewhat assume they wouldn't be that size if their product line didn't support it.

Thursday, May 6, 2004

2 words: Social Engineering

Thursday, May 6, 2004

Who cares?  If your take on the market does something no one else does, and if enough people decide that they have to have that bell or whistle, and are willing to pay for it despite the others in the competition, you will make money.

Probably your best bet is to go to people who would be consumers of your product, find out whether your gadget is enough more to them that they'd be willing to buy from you instead, and make your decision.  Your competitors are still going to be in business, but unless your marketplace universe is extremely small you will be able to carve out a niche.


Karl Perry
Thursday, May 6, 2004

I'm unemployed; help me get a job with one of them and I'll pass you information.

Thursday, May 6, 2004

Karl, I can't agree --  "If you build a great product, they will come". You need to determine the market size, and the effectiveness of the competition.

You may have an incredible product for your niche, but if there's only 1000 customers and they're only willing to pay $50 each, you're not going to make money!

Thursday, May 6, 2004

I've heard web email provider is a great business nowadays ...


Jonas B.
Friday, May 7, 2004

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