Master Thesis Sebastian Guth - Developing a competitor analysis canvas model for start-ups in the pre-seed phase

Developing a competitor analysis canvas
model for start-ups in the pre-seed phase: a
qualitative study of approaches, models and
concepts used by innovation-oriented
entrepreneurs, consultants and investors
Master Thesis
submitted at the
IMC Fachhochschule Krems
(University of Applied Sciences)
Master-Programme
“Marketing and Sales”
by
Sebastian GUTH
for the award of the academic degree
Master of Arts in Business (MA)
Thesis Coach: Klaus Kotek, MBA
Submitted on: 24.04.2015

Eidesstattliche Erklärung
„Ich erkläre an Eides statt, dass ich die vorliegende Masterarbeit (Diplomarbeit)
selbstständig verfasst, und in der Bearbeitung und Abfassung keine anderen als die
angegebenen Quellen oder Hilfsmittel benutzt, sowie wörtliche und sinngemäße
Zitate als solche gekennzeichnet habe. Die vorliegende Masterarbeit wurde noch
nicht anderweitig für Prüfungszwecke vorgelegt.“
Datum: 24.04.2015 Unterschrift
Statutory declaration
“I declare in lieu of an oath that I have written this master thesis myself and that I
have not used any sources or resources other than stated for its preparation. I
further declare that I have clearly indicated all direct and indirect quotations. This
master thesis has not been submitted elsewhere for examination purposes.”
Date: 24.04.2015 Signature

I
Preface
Start-ups have always been inspiring to me. The freedom and independence to
follow your own dreams instead of doing a job you get paid for is something I am
striving towards. But it is also the way how you can change things.
An entrepreneur does not accept how things are currently done, because he or she
is convinced that it can be done better.
Yet, there are questions that always need to be addressed. What is the customer
need? What is there on the market? What are competitors offering? How can it be
done better?
This master thesis therefore relates to these questions and how they can be
analysed, by providing a structure that facilitates the way of finding answers to them.

II
Acknowledgements
Special thanks to:
Klaus Kotek, MBA who actively supported me during the composition of my master
thesis and gave me valuable practical insights in the field of marketing in the course
of the master’s programme lectures.
Dipl.-Ing. Dr. Herwig Rollett, President of the Business Angel Institute who offered
me a co-operation partnership with the institute for the publication of the master
thesis and stood aside with scientific advice throughout the whole research process.
The Startup BOOTCAMP#1 of the IMC Founders LAB I participated in during the
period of the writing process, where I got myself confronted with the same questions
young entrepreneurs have to face in the pre-seed and seed phase of a company.
All interview partners who dedicated their time for contributing with their experiences
and ideas to the qualitative empiric part of the thesis.
Cornelia Kunstmann, Patrizia Pogacar and Evelyn Seidler who rendered me
tremendous assistance.

III
Abstract in English
Before founding a start-up, entrepreneurs need to develop an understanding for
their competitive environment. So far, academic literature has not yet specified how
start-ups proceed in this manner. Hence this master thesis investigates if start-ups
thereby use any specific models, tools, concepts or approaches. For this purpose,
an empirical study in the form of qualitative in-depth expert interviews was
conducted in which theories identified in the literature were assessed according to
their practical relevance. The results revealed that start-ups tend to combine
theoretic research with qualitative validation following the lean start-up method, yet
focus more on understanding customer needs than on competition. Regarding
competitive research procedures, start-ups in the pre-seed phase more often chose
to address strategic questions whereby models and concepts were used according
to their answering process. In order to structure these questions and models, the
author created a canvas model that provides a possible procedure in which the
questions are combined with models. The canvas can therefore be understood as
a step-by-step framework that can be applied by entrepreneurs to assess their
competitive environment.
Keywords: Strategic Marketing, Competitor Analysis, Start-ups

IV
Abstract in German
Vor der Gründung ihres Unternehmens müssen sich Startups ein Bild ihres
Wettbewerbsumfeldes machen. Bis dato hat sich die wissenschaftliche Literatur im
Speziellen nicht damit beschäftigt, wie Startups diesbezüglich vorgehen. Deshalb
wird in dieser Masterarbeit untersucht, ob Startups dabei irgendwelche spezifische
Modelle, Tools, Konzepte oder Vorgehensweisen verwenden. Zu diesem Zweck
wurde eine empirische Studie in Form qualitativer Tiefeninterviews mit Experten
durchgeführt, wo im Zuge der Literaturrecherche identifizierte Theorien hinsichtlich
ihrer praktischen Relevanz bewertet wurden. Die Ergebnisse legten nahe, dass
Startups prinzipiell theoretische Recherchen mit qualitativer Validierung in
Anlehnung an die Lean Startup Methode kombinierten, allerdings wurde der Fokus
mehr auf ein Verständnis des Kundenbedürfnisses, als auf den Wettbewerb gesetzt.
Hinsichtlich der Vorgehensweisen bei Wettbewerbsanalysen formulierten Startups
eher strategische Fragestellungen, bei denen Modelle oder Konzepte im Zuge der
Antwortfindungen verwendet wurden. Um diesen Fragestellungen und Modellen,
eine Struktur zu geben, entwickelte der Verfasser ein Canvas-Modell, wo die Fragen
mit den Modellen kombiniert werden. Das vorgestellte Modell versteht sich dabei
als schrittweise Handlungsempfehlung zur Analyse des Wettbewerbsumfelds,
welche von Gründern verwendet werden kann.
Schlüsselwörter: Strategisches Marketing, Wettbewerbsanalyse, Startups

V
Table of Contents
Preface.....................................................................................................................I
Acknowledgements.................................................................................................II
Abstract in English .................................................................................................III
Abstract in German ............................................................................................... IV
Table of Contents................................................................................................... V
Table of Figures & Illustrations............................................................................ VIII
List of Abbreviations.............................................................................................. IX
1 Introduction.......................................................................................................1
1.1 Introductory Words on the World of Start-ups............................................1
1.2 Problem Statement and Definition of the Research Gap............................7
1.3 Research Question and Objectives..........................................................10
1.4 Chapter Outline........................................................................................12
2 Definitions.......................................................................................................15
2.1 Description of a Start-up and its Traits.....................................................15
2.2 Company Stages and the Financing Lifecycle .........................................16
2.3 Definition of ICT and High-Tech Sectors..................................................17
3 Literature Review............................................................................................19
3.1 Introductory Words about Competitor Analysis ........................................19
3.2 “Traditional” Models for Conducting a Competitor Analysis .....................22
3.2.1 A Step-by-Step Approach..................................................................22
3.2.1.1 Industry Analysis.........................................................................24
3.2.1.2 Industry Mapping ........................................................................28
3.2.1.3 Critical Success Factors .............................................................30
3.2.1.4 Competitor Profiling ....................................................................31
3.2.1.5 Special Competitor Analysis .......................................................33

VI
3.2.1.6 Value Chain Analysis ..................................................................34
3.2.1.7 Benchmarking.............................................................................36
3.2.1.8 Building a Competitive Advantage ..............................................37
3.3 Entrepreneurial Approaches to Competitor Analysis................................41
3.3.1 The Four Start-up Market Types According to Steve Blank...............42
3.3.1.1 Entering in an Existing Market ....................................................42
3.3.1.2 Entering in a New Market............................................................43
3.3.1.3 Re-segmenting an Existing Market .............................................44
3.3.2 Steve Blank’s View on Competitive Analysis.....................................45
3.3.3 Kim’s and Mauborgne’s Blue Ocean Strategy ...................................48
3.3.4 Frameworks for the Creation of Blue Oceans....................................50
3.3.4.1 The Strategy Canvas ..................................................................51
3.3.4.2 The Four Actions Framework and the ERRC Grid ......................53
3.3.5 Summary of the Blue Ocean Strategy ...............................................54
4 Methodology...................................................................................................56
4.1 Method of Qualitative Data Collection......................................................56
4.2 Methodology of Qualitative Research ......................................................57
4.3 Methodology of Qualitative Data Evaluation ............................................58
5 Empirical Part of the Thesis............................................................................60
5.1 Analysis and Results of Qualitative Data .................................................60
5.1.1 General Comments on Competition and Competitor Analysis...........60
5.1.2 Comments on Market Understanding, Strategy and Differentiation...62
5.1.3 General Practices Regarding the Usage and Application of Models .66
5.1.4 Findings on Hussey’s Step-by-Step Competitor Analysis Approach..67
5.1.5 Customer Need and Idea Verification................................................68
5.1.6 How Markets are Analysed................................................................70

VII
5.1.6.1 Applicability of Porter’s Five Forces to the Start-up Level...........71
5.1.6.2 Market Mapping as Inevitable Part of Market Analysis ...............72
5.1.6.3 Critical Success Factor Definition ...............................................74
5.1.7 Business Model Verification ..............................................................76
5.1.8 Competitor Analysis Techniques and Graphic Depiction for Pitches.78
5.1.8.1 Competitor Profiling ....................................................................78
5.1.8.2 Competitor Matrix and Checklist .................................................79
5.1.8.3 Strategy Canvas .........................................................................81
5.1.8.4 Petal Diagram .............................................................................81
5.1.9 Benchmarking....................................................................................82
5.1.10 The Attainment of Competitive Advantages ...................................83
5.2 Discussion of Qualitative Data .................................................................86
5.2.1 Comments on Differences between Theory and Empiric Results......86
5.2.2 Presentation of the Competitor Analysis Canvas Model....................90
6 Limitations and Further Research...................................................................96
7 Conclusion......................................................................................................98
References..........................................................................................................101
Appendix .............................................................................................................113

VIII
Table of Figures & Illustrations
Table 1: Top 13 Reasons why Start-ups fail............................................................3
Table 2: Summary of typical Components of a Business Plan................................5
Table 3: Excerpt from a Model Example for CPM .................................................32
Table 4: The VRIO Model......................................................................................39
Table 5: Comparison of Blue and Red Ocean Strategies......................................50
Table 6: Author's Example of a Competitor Checklist ...........................................80
Table 7: Author's suggested Competitor Analysis Canvas Model .........................92
Graph 1: Company Stages and Financing Lifecycle .............................................16
Graph 2: Step-by-Step Approach..........................................................................23
Graph 3: Porter’s Five Forces ...............................................................................25
Graph 4: Porter's Generic Strategies ....................................................................26
Graph 5: Example Market Map .............................................................................30
Graph 6: Perceptual Mapping Example ................................................................34
Graph 7: Value Chain Analysis .............................................................................35
Graph 8: Summary of Competitive Advantage......................................................40
Graph 9: Four Types of Start-up Markets..............................................................45
Graph 10: Blank's Petal Diagram ..........................................................................47
Graph 11: Structure of a Strategy Canvas ............................................................51
Graph 12: An exemplary Strategy Canvas analysing the transportation industry..52
Graph 13: Structure of the Four Actions Framework.............................................53
Graph 14: The Step-by-Step Model of Summarising Content Analysis.................59
Graph 15: Steps of Idea and Customer Need Verification ....................................69
Graph 16: Summary of Sequential Critical Success Factors.................................75
Graph 17: Exemplary Radar Chart........................................................................80

IX
List of Abbreviations
ATL Above the Line
B2B Business to business
B2C Business to consumer
CSF Critical Success Factor
CPM Competitor Profiling Matrix
DACH Germany, Austria, Switzerland
ERRC Eliminate, Reduce, Raise, Create
FFF Family, Fools and Friends
FMCG Fast moving consumer goods
Four Ps Product, Price, Promotion, Place
GDP Gross Domestic Product
ICT Information and communications technology
IKT Informations- und Kommunikationstechnologie
IP Intellectual Property
IPO Initial Public Offering
IT Information technology
KPI Key performance indicator
MBI Management Buy In
MBO Management Buy Out
MNC Multinational company
MVP Minimum viable product
OECD Organisation of Economic Co-Operation and Development
OCR Optical Character Recognition
OEM Original equipment manufacturer

X
PEST Political, economic, social and technological
ROI Return on investment
SME Small and medium-sized company
STP Segment, target, position
SWOT Strengths, weaknesses, opportunities and threats
US United States
USP Unique selling proposition
VC Venture capital
VRIO Valuable, Rare, Imitable, Organised

1
1 Introduction
This first chapter is intended to provide the reader with an introduction to the world
of start-ups. Furthermore, it describes the research problem and defines the
according research question. Apart from this, it outlines the thesis’ structure.
1.1 Introductory Words on the World of Start-ups
The rise of the so-called “new economy” has brought a paradigm shift in the design
of value generation processes across various industries, since the term is broadly
associated with the age of modern information society. Stuhr (2014, p.24) thereby
applies the new economy concept to three different levels of definitions. The first
one relates to the informational level which supports the seminal importance new
information and communication means such as the internet have brought in terms
of value creation. In its second meaning, the term describes industries that are
established in the ICT sector (information and communications technology). These
industries are typically comprised of IT companies that are engaged in computer,
software or internet related services. The third level relates to the world of start-ups
that embodies the essence of the new economy, namely innovating existing market
patterns and developing new industrial concepts.
Start-ups considerably challenge existing market conditions by constantly
innovating and consequently foster economic growth. According to Kane (2010,
p.2), who conducted a study on the contribution of start-ups to increased US-
employment, newly founded ventures generated an average of three million newly
created jobs annually between 1977 and 2005. The numbers show that start-ups
accounted for all net job creation whereas existing companies rather downsized
employees. Similarly, interned-driven markets in developed countries of the G-20
have been projected to grow at annual rate of 8 percent, which underlines how
significantly start-ups are engaged in the new economy (Dean, Digrande, Field,
Lundmark, O'Day, Pineda & Zwillenberg, 2012, p.6).

2
Given that numerous initiatives across the European Union have been initiated to
fund and support newly founded ventures, it appears that the European institutions
and governments have begun to realise the potential of start-ups to contribute to the
alleviation of the currently precarious economic situation (Varza, 2013). In the case
of Austria, start-ups together with newly founded companies created up to 200.000
jobs with a value added of 2,8% of the GDP in 2014 (Austrian Startups, 2013 p.12).
Therefore, one can conclude that the success of start-ups is in the interest of
economies.
However, the overwhelming majority of start-ups does not survive the first year or
even first months after foundation. About 90% of tech start-ups are not successful
and US venture capitalists apply a rule of thumb that 3 out of 4 start-ups will go out
of business (Dalakian, 2013). Yet, roughly only about 25% to 30% of venture capital
funded start-up companies fail (Gage, 2012). Moreover, it should be mentioned that
according to OECD data of member states, bankruptcy rates are less comparable
across countries, because they can be highly affected by national legislation as well
as the consequences of economic crisis (Organisation of Economic Co-Operation
and Development [OECD], 2012). In summary, it can be stated that establishing a
successful start-up involves overcoming major hurdles of all different kinds and
severe mistakes in the early stage may imply that a start-up company fails.
In addition to external obstacles such as regulative or legislative changes, a number
of internal factors could lead to failure. Several experts have a similar tenor
regarding the top reasons why start-up companies fail (Tobak, 2014; Deeb, 2013;
Skok, 2015; Vals, 2014; CB Insights, 2014; Griffith, 2014).

3
Source: Deeb, 2013
Primarily, entrepreneurs fail to recognize that their idea does not serve a relevant
customer need. In other words, the start-up's idea does not provide a unique solution
to a problem the customers face. Therefore, a potential product solution will often
not be scalable due to a lack of market that could be entered or developed. Other
top reasons indicate that start-ups either use a poorly developed strategy or
business model. As a result, they often run out of cash too early. The reason
therefore could be that revenues, which are generated by customers, cannot be
monetised timely or customer acquisition costs outweigh the actual customer life
time value.
Next to soft skills related issues, such as lack of leadership, failure in management
or team performance, one source of error leading to start-ups going out of business
concerns competition. Deeb (2013) even lists false market positioning caused by no
competitive research as the second most frequent diagnosis of business failure.
This means that entrepreneurs easily underestimate competition or even refrain
from analysing the competitive environment, because they are convinced of the
uniqueness of their idea. As competitors can stem from various industries they may
not immediately be detected as a direct threat. Start-ups typically forget to address
Table 1: Top 13 Reasons why Start-ups fail
1. Small or un-scalable idea
2. No competitive research – wrong market positioning
3. No go-to-market strategy
4. No focus
5. No flexibility – know when to cut losses
6. No passion or persistence
7. Wrong or incomplete leadership
8. Unincentivised or unmotivated team
9. No mentors or advisors
10. No revenue model
11. Less capital than needed – no venture capital experience
12. No long term roadmap to ROI
13. Bad luck or timing

4
strategic questions such as how to differentiate themselves and neglect the
importance of developing a USP or defining the value-added of the product or
service they offer. Similarly, entrepreneurs hardly elaborate concepts of how to react
to new market entrants or other developments such as technologic trends.
Misguided by an often unrepentant belief that their product or service will be the
“next big thing”, with which an inefficient market will be disrupted, start-ups often
assume that existing competitors will not fight back to retain their market share.
All these circumstances sketch a picture of a technician that invents an innovative
or even revolutionary product, which, however, does not meet the consumers’
needs, because competitors better communicate the value-added of their solutions.
Thus, having conducted a competitor analysis will have a significantly positive
impact on a start-up’s performance and consequently on the economy because
more start-ups will succeed.
Certainly, it needs more than knowing your competition in order to turn an idea into
a compelling product and then a viable start-up company. Prior to the stage where
a competitor analysis could be useful, several other strategic questions should be
first answered by the entrepreneur. For instance, these questions should deal with
the benefits of the potential product or service that will be provided to the customer.
Furthermore, entrepreneurs need to analyse how customers behave and what their
typical characteristics are. Similarly, the market that is intended to be entered by the
start-up as well as the product’s potential on the market ought to be clearly
researched (Spaeder, 2015).
Boué, Kehlbeck & Leonhartsberger-Heilig (2012, p.106) underline the importance
of start-ups considering these issues for the funding process. A strategy, measures
as well as an analysis of the market and competition should be therefore clearly
defined in a written business plan. The subsequent table shows typical components
that the business plan of a company should contain. Especially for start-ups that are
looking for funding such a business plan can serve as an indicator to potential
investors whether the entrepreneurs have conducted sufficient research about their
idea and the feasibility of its implementation. Business goals should be attainable
and realistic (Pinson, 2008, p.2.).

5
Source: Boué et al. (2012, p.169)
Table 2: Summary of typical Components of a Business Plan
Executive Summary Marketing and sales concept
 Core messages and most relevant information
 Target group characteristics
 Customer touch point journey
 Market entry strategy, timing and four Ps
The basic idea and type of business Prospective company development and
SWOT analysis
 Description of problem solution
 Description of customer need that is satisfied
 USP
 Stages of development of the product
 Legal conditions
 Production process and costs or entry barriers for
prospective competitors
 Prospective company strategies
 Trends and influencing factors on the
market
 Sales planning on the strategic level
 Innovation planning
 SWOT Analysis
Company profile, organisation and management Risk analysis
 Type of legal entity
 Capital and shareholder structures
 Management and employee competences
 Implications about strategy and corporate culture
 Measures for risk identification, tracking and
controlling
 Technologic and capacity risks
 Management and employee risks
 Market and external risks
Market and competitor analysis Budgeting and cash flow-forecast
 Market potential and sales volume
 Market segments and strategies (for respective
regions, customer groups etc.)
 Structure and market shares of competitors
 Product range, strategies and competitive
advantages of competitors
 Customer analysis (consumer behaviour, customer
need, demographic and psychographic details)
 Political and legal influencing factors
 Technologic influencing factors (e.g. product
innovation, substitution products)
 Economic influencing factors (e.g. supply and
demand for a product, customer purchasing power,
degree of satisfaction in the market, influence of
currency fluctuations)
Sales turnover and cost forecasts
Investment planning and planning of
prospective capital requirements
Profit and loss forecasts
Balance and liquidity planning
KPI figures
Scheduling and milestone plan
 Activity plan per employee
 Milestone plan (revenue parameters
that need be achieved etc.)
Annex

6
Yet, a business plan is just a formally written document that should serve as a guide
for the intended business. Opinions about the sense of a business plan as
motivating factor for the founders to deal with internal and external implications of
the business idea diverge. Ultimately not everything can be planned or researched
and unexpected developments in the market cannot be anticipated (Brown, 2013).
As a result extensive planning does not necessarily imply guaranteed success
(Spors, 2007).
An alternative approach how to minimise this pre-programmed uncertainty of
success is the so-called lean startup concept of Steve Blank. The concept which
was popularised by Eric Ries (2011) is becoming more and more accepted among
start-ups worldwide (The Lean Startup, 2015). Instead of following the traditional
way of researching the market, writing a business plan, then developing the product,
setting up a team and hoping that the customer would buy it, some entrepreneurs
rather work with untested hypotheses. Instead of researching their validity, these
entrepreneurs prefer to test them empirically. As soon a hypothesis is accepted,
new hypotheses have to be assumed again and again, which will then be tested in
practice. In other words, instead of writing extensive business plans entrepreneurs
summarise their hypotheses in a framework named business model canvas, which
depicts how the company creates value for itself and its customers. Furthermore,
they interview potential business partners, customers and investors about the
elements of their business model, such as distribution channels, pricing or USP and
present them a minimum prototype in order to ask for product feedback. By following
this approach start-ups can avoid developing and marketing a product that the
customer does not need and which would therefore not get established on the
market. Alike, only relevant information can be quickly gathered. This iterative
approach motivates companies to elaborate a business model rather than to plan it
(Blank, 2013a, p.5).
To summarise, it can be stated that in the very beginning of a start-up there are a
number of strategic questions that should be addressed first, irrespective of whether
they are being researched or learned by receiving feedback. Acquiring some
understanding of the competitive environment and dynamics of a market is an
inevitable step for a start-up when developing a business model and strategy.

7
Thereby, it is reasonable that market, competitor, customer and other types of
analysis can go hand in hand. It is crucial that entrepreneurs conduct the
abovementioned analysis, because start-ups tend to make themselves believe
“there is no competition” too often. In fact, competition on a market does not
necessarily have a negative connotation. Rather, competition is proof of a market’s
existence where the best ideas succeed. Thus, start-ups need to find an answer to
how to differentiate themselves and make their ideas unique (Warrillow, 2011).
This thesis approaches the question of how start-ups conduct their competitor
analysis in the pre-seed phase. In addition to the scientific community, the
researcher intends to address with this thesis prospective entrepreneurs that would
like to found a start-up company as well. On the one hand the thesis summarises
concepts and approaches to competitor analysis found in academic literature. On
the other hand, qualitative empirical interviews with entrepreneurs, business angels,
venture capitalists and representatives of incubators have been conducted.
Thereby, the researcher investigated how these respondents approached
competitor analysis during the foundation of their own start-up companies and how
they would recommend to proceed in this matter. Hence, this research work should
not only be understood as master thesis comparing theories with empirical data. By
having asked successful founders and experts in the field of entrepreneurship about
their reflections on the subject, the reader, who might be an upcoming founder, will
be provided with practical information on what implications regarding competition
need to be taken into account.
1.2 Problem Statement and Definition of the Research Gap
In today’s fast-moving world of business, competition has become an evident
consequence of aspects such as globalisation, industrialisation, commercialisation
and modern communication means caused by technologic advance. Especially for
start-up companies the rise of the internet has brought tremendous opportunities to
quickly execute a business idea and to market a product or service. This change is
due to factors such as costs or duration of setting-up a business and the conduction

8
of market research that have been dramatically reduced and facilitated (O’Farrell,
2015). However, the almost infinite scope of information that the internet has given
everyone, allows customers to easily compare prices. Thus, the competitive
environment has heavily intensified (Schifferes, 2006). Hence, in order to enter
existing markets or to create new ones, it appears to be inevitable for start-up
companies to know about their competitive environment and to understand the
dynamics that drive the market.
The term competitor analysis covers a broad spectrum in the field of marketing and
strategic management, which is also where the most extensive literature on the topic
can be found. Just to name a few aspects relevant to competitor analysis, the
researcher has encountered in the course of his literature review the following
topics. So far, extensive research has been conducted on general aspects of
competitive strategies and scenarios (Fahey, 2003), competitor analysis
methodologies (Wilson, 1994) and theoretical constructs such as resource similarity
based on the Resourced-Based View (Chen, 1996). Furthermore, studies about
common competitor analysis practices of well-established companies (IsHak &
Subramanian, 1998), or firm resources and competitive advantage (Barney, 1991)
exist. Standard marketing or strategy literature on competitor analysis includes
comprehensive books, such as Porter’s “Competitive Strategy” (1980), “Strategic
management: from theory to implementation” by Hussey (2007), “Marketing-
Management” by Kotler & Bliemel (2001), “Marketing Concepts & Strategies” by
Dibb, Simkin, Pride & Ferrell. (2012) or Grant’s “Contemporary Strategy Analysis”
(2013) which prevalently approach the topic from the point of view of a well-
established company in the market or even of a MNC. Yet, the perspective of a start-
up company, not to mention one that is in the pre-seed phase, is not yet addressed
by literature. Even if basic principles of competition might remain similar
independent of company size, certain patterns, approaches or behaviours of large
companies cannot be broken down and applied to the start-up level.
Steve Blank (2014a), a renowned serial entrepreneur and academician explains the
difference by stating that a startup-company represents a temporary organisation

9
as it is searching for a repeatable and scalable business model, whereas an
established company is considered a permanent organisation that needs to execute
a proven business model. Since existing companies are focused on the execution
they often lack innovation or do not recognise upcoming competitors. By contrast,
due to the obviously smaller company size, start-ups mostly lack formal processes
and structures, while they exhibit far more agility and flexibility regarding
developments on the market. As a result, start-ups also show different needs
regarding the extent of competitive intelligence, since certain steps in the competitor
analysis appear to be irrelevant, or with respect to the venture’s lacking funds,
human resources and time even impossible.
By contrast, literature in the field of entrepreneurship covers the topic of competitor
analysis at the start-up level or provides a different point of view and general
recommendations with respect to market and competition. For instance, Blank
presents in “The Four Steps to the Epiphany” (2007) four types of markets that start-
up companies can typically enter and that consequently influence competitive
patterns. “Business Model Generation” by Osterwalder & Pigneur (2010) as well as
“Blue Ocean Strategy” by Kim & Mauborgne (2005) can be both considered as
standard literature for start-ups and recommend the application of the strategy with
the same name when approaching competition. The abovementioned lean startup
concept from “The Lean Startup” by Ries (2011) suggests a totally different
approach on how to proceed as a start-up, namely by getting early customer
feedback rather than conducting extensive research the perspective on how
competition is perceived will be also affected. Apart from that, literature from the
entrepreneurial field was also found that utilises concepts based on existing
academic sources, such as Cabage & Zhang (2013) or Kim, Nam & Stimpert (2004).
Moreover, extensive information on the start-up level can be found in non-academic
as well as online sources which provide recommendations on what aspects and
factors should be taken into account concerning competitor analysis. These mostly
include entrepreneurial or business magazines (Inc.; Forbes; Entrepreneur; The
Wall Street Journal), specialised start-up media websites (techcrunch.com;

10
thenextweb.com; venturebeat.com), or websites of opinion leaders from the start-
up ecosystem (steveblank.com; tomtunguz.com).
Empirical studies have been conducted in the field of competition or competitor
analysis and focus for instance on the differences between competitive behaviour
of SME and large companies (Chen & Hambrick, 1995), which however are
established in old economy industries. In general, empiric literature does not
address to what extent start-ups in the pre-seed phase conduct their competitor
analysis before setting-up the business model, or how a typical approach towards
the concrete procedure thereby could look like. It is therefore the intention of this
thesis to close the described research gap.
1.3 Research Question and Objectives
In order to close the described research gap the scientific purpose of this master
thesis is to shed lights on how and to what extent start-up companies in the pre-
seed phase conduct competitive analysis of the market they are entering. On the
one hand, this thesis contains a theoretic part in form of a literature review. In this
chapter, eligible concepts, procedures and tools found in academic literature that
could be used as reference models for analysing competition are summarised. On
the other hand, qualitative research in the form of in-depth expert interviews has
been conducted. These interviews provide comprehensive empirical evidence of the
respondents’ experiences as well as recommendations on how to proceed in the
pre-seed phase regarding the analysis of a start-up’s competitive environment. The
respondents have assessed the selected models according to their relevance,
plausibility and applicability for the conduction of a competitor analysis. The results
of the qualitative data are then presented and discussed in the thesis’ empirical part.
Accordingly, the research question reads as follows:
Based on reference models, such as Porter’s Generic Strategies and others,
to what extent are different competitor analysis approaches used by start-ups
in the pre-seed phase and how much benefit do they expect from each?

11
By using existing reference models, which illustrate competitive analysis
approaches in academic literature, the empirical work will be grounded in
established scientific theory and hence their applicability to specific situations of
start-ups in the pre-seed phase will be checked. In other words, an empirical
evaluation of the suitability of alternative competitor analysis approaches will be
simplified by utilising existing theories. The referencing of Porter’s Generic
Strategies should be seen only as an example of an established theory of
competitive behaviour, but in the literature review several other valid and suitable
theories are mentioned.
From a scientific point of view the objective of this master thesis is not only to close
the aforementioned research gap but also to test the practical relevance and the
accuracy of the models in real life, which constitute the theoretical counterpart of the
empirical data. Furthermore, as the respondents of the qualitative interviews have
different industry experiences, differences in factual usage of the presented
reference models or the use of any industry specific tools, patterns will be subject
to research. In addition, models that can be applied independent of industry will be
examined. Last but not least, the difference in usage as well as applicability between
older and newer models will be elaborated.
From a practical point of view, the outcome of the thesis will be a canvas model,
which represents a general research procedure for the conduction of a competitor
analysis in the pre-seed phase. Based on the empirical findings from the
interviewees, the canvas is intended to compactly recapitulate the major results of
the qualitative analysis and discussion in a graphic form. On the one hand,
entrepreneurs seeking to found a company could use this table in order to read off
“how others did it” or how they recommend to proceed with the competitor analysis.
In other words, the planned benefit of the table is to provide prospective
entrepreneurs with a “tool” that facilitates the conduction of a competitive analysis
of which strategic recommendations can be derived. Furthermore, according to the
respondents, the canvas will show to which extent reference models have been or
can be utilised for the individual steps of the analysis and what graphic depiction of

12
the competition could be favourable. On the other hand, the table can also be of
practical interest to investors, such as business angels. They could use the table to
examine the validity of a competitor analysis by a potential portfolio company.
1.4 Chapter Outline
The following section provides the reader with an overview of the study’s structure
and shall clarify alterations or amendments in comparison to the outline projected in
the proposal of the master thesis.
In the introduction (chapter one) the researcher gave insights in the world of start-
ups by contextualising them in the new economy and highlighting their importance
as a major economic factor that drives innovation and creates employment. Next,
the primary reasons why start-ups fail were stated. As a result, it was concluded that
missing awareness in particular and lacking strategies for analysing the competitive
environment were ranked among the top causes of failure. Major strategic questions
start-ups should answer in the competitor analysis were classified with respect to
the overall research process in the form of a business plan. There, the major results
of the research and the defined strategy are presented. By contrast, the increasingly
popular lean startup method which fosters a customer-centric rather than a
research-focused approach was explained in order to show the reader recent
developments in the world of start-ups. In the problem statement the research gap
was described and existing literature in marketing, strategic management and
entrepreneurship was brought in relation to the topic of competitor analysis of start-
up companies. Last but not least, the research question, which aims to investigate
whether start-ups use any models, tools or approaches when conducting the
competitor analysis was stated. Furthermore, the thesis’ theoretical and practical
objectives such as the examination of the reference models’ applicability as well as
the development of the canvas model for a general research procedure regarding
competitor analysis were defined.
The second chapter named “Definitions” encompasses three sections and is
designed in order to narrow down the commonly used terms. In the first section, the

13
term “start-up” will be explained in more detail as well as the typical characteristics
that differentiate it from other types of companies. The second section will then go
into detail of company stages and the associated financing lifecycle. The pre-seed
phase will be highlighted, as it denotes the most relevant stage for this thesis. In
order to provide the reader with a better background understanding of the
interviewees’ industry experiences the terms ICT and high-tech will be clarified in
the third section.
The third chapter will consist of the literature review, which will be divided into three
sections. First, a rough description of the competitor analysis will be provided
including the major strategic issues it addresses. In the second section, “traditional”
tools, models and approaches for the conduction of a competitor analysis that have
been found in the established literature will be shown. By using a step-by-step model
that integrates market and competitor analysis the individual stages of classic
competitor analysis approach will be examined. Thereby, specific tools that could
be applied for the respective stage will be presented. The third section will
demonstrate the point of view from the entrepreneurial world. There, models,
approaches and tools that were suggested by founders and venture capitalists will
be included, setting a focus on Steve Blank’s ideas and the Blue Ocean strategy.
The fourth chapter will outline the methodology that has been used for the qualitative
empiric research, the criteria under which interview partners were chosen and the
composition as well as characteristics of the sample size. Also the in-depth expert
interviews as method of data collection and the summarising qualitative data
analysis according to Mayring (2014) will be illustrated and reasoned.
In the fifth chapter, which denotes the empirical part of this thesis the results of the
qualitative data will be analysed and discussed. In the first section, the identified
categories and summarised statements of the respondents according to the
qualitative data evaluation will be presented. Furthermore, exemplary quotes of the
interviewees will be shown. Subsequently, the qualitative results will be interpreted
and compared with the findings from the literature review. Finally, as a synthesis

14
between theoretic and empirical results the competitor analysis canvas model,
which denotes the thesis’ overall goal, will be depicted and its implications
explained.
The sixth chapter will evaluate the significance of the results and mention the limits
of the research design. Furthermore, an outlook of topics that could be subject to
further research will be given. The “Conclusion” as seventh chapter will reflect the
insights gained by this master thesis and finally answer the research question.
Last but not least, sources that have been used for this thesis will be listed in the
references. The interview transcripts and qualitative data evaluation can be found
in the appendix.

15
2 Definitions
In order to clarify the field of research the following section will set out definitions
regarding the term of a start-up and related aspects that should be mentioned for a
better understanding of the context the topic is embedded in. Apart from that, the
company phases a start-up ideally runs through will be shortly discussed, thereby
focusing on the pre-seed phase. Last but not least, as the qualitative empirical study
was limited to experts’ experiences from high-tech and ICT related sectors, these
terms will be shortly described as well.
2.1 Description of a Start-up and its Traits
Hahn (2014, p.4) associates the term “start-up” both with a company that is currently
in the process of being founded, but also with a young company with high growth
and innovation potential. Insofar, this potential to scale up a start-up’s whole
business model distinguishes it from a conventional SME. Similarly, Baum and
Silverman (2004, p.419) argue that, apart from other factors, a start-up’s
performance critically depends on its innovative capabilities, which is why the
degree of innovation is one of the most salient features that differentiates a start-up
from a conventional founded company.
The possibility to expand, for instance by boosting sales volume or entering new
markets, is not only in the interest of entrepreneurs, but also of investors, such as
venture capital funds. In their definition of private equity, Boué et al. (2012, p.43)
describe the increased shareholder value at the end of the investment period as the
integral objective. Other aims are providing entrepreneurial support to the founders
and the associated control including decision making rights. Therefore, it can be
concluded that equity capital based financing denotes a further trait of start-up
companies.
Moreover, Pendergast (2003, p.3) finds that the entrepreneurial context is especially
marked by uncertainty and resource scarcity. Yet, start-ups typically adapt an
attitude which is oriented towards opportunity recognition and creativity. This seizure

16
of opportunities, such as to enter an existing or new industry, is driven by the
entrepreneurs’ vision and optimism to innovate a market, thereby adding value to
the customer’s life with a better product or service solution.
To sum up, a start-up can be defined as an innovation driven company, which
currently is in the early stage of its development. Due to its scalable business model,
it is typically financed by equity capital. Ideally, a start-up’s entrepreneurs can be
characterised as optimists or even visionaries that show a high orientation towards
creativity and opportunity recognition.
2.2 Company Stages and the Financing Lifecycle
Boué, et al. (2012, p.48) structure companies according to their chronologic
development and their financial needs in the respective stage of the company
lifecycle. Basically, the term start-up thereby relates to an enterprise that has been
recently founded and is therefore in the early stage of this lifecycle. In order to
provide the reader with a basic understanding of the concept of company stages,
the relevant aspects of the following model will be briefly explained.
Source: Author’s graph referring to Boué et al. (2012, p.48)
EARLY STAGE
Seed Stage
(concept and product)
EARLY STAGE
Start-up
(foundation)
EARLY STAGE
First Stage
(product launch)
EXPANSION
Second Stage
(niche leadership)
EXPANSION
Third Stage
(internationalisation)
EXPANSION
Fourth Stage
(pre-IPO)
MBO/MBI
Buyout Stage
POST-IPO
PUBLIC-TO-PRIVATE
Take Private Stage
Graph 1: Company Stages and Financing Lifecycle

17
In general, the respective stages involve different entrepreneurial activities, risks,
capital requirements and types of financiers. The company life cycle can be broadly
divided into three major stages beginning with the early and followed then by
expansion stage. In the last phases, a company could be either acquired (buyout),
or could issue shares on a stock exchange (IPO). Rarely, companies that have gone
public are then taken back private. As this thesis concentrates on the pre-seed
phase, the author will limit explanations of this company lifecycle to the early stages.
Hahn and Naumann (2014, p.83) describe the pre-seed phase as the period of time
where entrepreneurs decide to found a company, but still need to research their
business idea. Insofar, the term should be understood as early part of the overall
seed phase. In general, during the seed phase, a company runs through the
foundation process and founders have merely generated an innovative idea.
Consequently, only preliminary market analysis have been undertaken, which,
however, seem to be promising for the success of the venture (Boué et al., 2012,
p.49). In the next step, from which the term start-up can be derived, the company
has been already founded and comprehensive analysis have been conducted.
Likewise, a product or service solution has already reached market readiness (Boué
et al., 2012, p.50). The last step, the so-called first stage is characterised by the
company’s market entry, which is why first sales of the product or service are
generated. All in all, it should be mentioned that the development process of early
stage companies typically is not linear and certain entrepreneurial activities such as
market or competitive analysis might be conducted rather in an iterative manner.
2.3 Definition of ICT and High-Tech Sectors
As the qualitative empiric part of this thesis will reveal results, which were obtained
from expert interviewees with ICT or high-tech oriented industry backgrounds, this
section is intended to provide the reader with a basic understanding of the two
broadly defined fields.
The industrial sectors related to information and communications technology (ICT)
will be subject to further research of this thesis. This term can be understood as

18
collective term that comprises on the one hand information technology, such as
computer and software related technologies. On the other hand, it includes for
instance internet, telephone, mobile or application based telecommunication
services. Yet, the term emphasizes that these two industrial fields are increasingly
becoming integrated and unified (Böcker & Klein, 2012, p.12)
The second industrial focus of this master thesis will be set on the so-called high-
tech sector. High-tech is a term that indicates that products relating to this
technology are based on know-how intensive research and development. As a
result, these products are considered as most advanced technology that is currently
available on a market. In general, broadly four categories of technology industries
can be identified, which are classified as either low-technology, medium-low,
medium-high or high-technology according to their intensity of research and
development. For instance, radio, television and communications equipment or
office, accounting and computing machinery can be classified as high-tech products
(OECD, 2011).

19
3 Literature Review
This chapter serves as a theoretical basis for the empirical part of this thesis and is
structured as follows. The first section provides a brief introduction of the context of
competitor analysis. The second section presents “traditional” tools, models and
approaches that were identified as eligible for the conduction of a competitor
analysis. The third section outlines how the entrepreneurial world approaches the
topic of competitor analysis.
3.1 Introductory Words about Competitor Analysis
This initial section of the literature review part is intended to provide the reader with
a basic understanding regarding the context of competition and its strategic
implications. Reasons why a competitive analysis might not only be useful but even
necessary in order to establish or maintain business operations will be evaluated.
Also, the major strategic questions the outcome of a competitor analysis should give
answer to will be described.
Dibb et al. (2012, p.40) point out the indispensability of a competitor analysis in
scope of the development of a marketing strategy. By elaborating a marketing
strategy companies ought to define their target markets and competitive
advantages. Therefore, an “awareness of the external trading environment and
market trends, an appreciation of the organisation’s capabilities and resource base,
an understanding of changing customer behaviours and expectations, and
knowledge of competitor’s intentions and proposition” is necessary.
Given the seriousness of competitive threats, Fahey (2003, p.32) refers to the
historic case of Amazon.com with its revolutionary internet-based business model,
causing a shake-up in the book-retailing industry. Due to inattention or negligence,
the book-retailing chains had missed out on the upcoming internet trend. As a
consequence, he concludes that “managers need to be familiar with scenarios of
future markets that are not merely extrapolations of current trends. This is because

20
history teaches that the most potent competitors often emerge unexpectedly – from
surprising sources and under unanticipated circumstances.”
However, even if nowadays competitors emerge overnight there are usually signals
that point out imminent changes in market and industry structures. Therefore, it
definitely pays for companies to continuously monitor the competitive environment.
In their empirical study about competitor analysis practices IsHak & Subramanian
(1998, p.21) support this argument by stating that companies with advanced
monitoring systems are more profitable than those not running such systems.
Moreover, they argue that “the findings of the study indicate that better performing
firms gain a competitive advantage by using advanced monitoring systems”.
Certainly, the enhancement of a competitive advantage represents the overall goal
of a clearly formulated strategy. Regarding its impact on strategic management
Bergen & Peteraf (2002, p.158) endorse this statement by noting that competitor
identification provides a foundation for the analysis of the industry infrastructure,
conditions of rivalry and sources of competitive advantage as well as resulting
occurring threats or opportunities. Furthermore, Barney (1991, p.102) finds that a
company has a competitive advantage “when it is implementing a value creating
strategy not simultaneously being implemented by any current or potential
competitors”. The term sustainable competitive advantage adds to the previous
definition that competitors are unable to duplicate the benefits of the strategy.
Likewise, Wilson (1994, p.24) recognises the development of a competitive
advantage as the ultimate objective of a competitor analysis which is based on the
assessment of competitor’s strengths and weaknesses. Apart from that, Wilson lists
several other benefits. Analysing competitors can even indirectly help
understanding purchasing behaviour of customers by identifying target groups that
competitors’ strategies try to appeal to. In return, the gained insights can be used
then as effective mean for positioning. In other words, by understanding a
competitor’s behaviour a company can better anticipate the rival’s next move and
therefore prepare a defensive strategy.

21
Thus, it can be concluded that apart from the overall goal to facilitate the attainment
of a competitive advantage a competitor analysis should find answers to several
strategic issues which are summarised in the following (Wilson, 1994, p.24; Czepiel
& Kerin, 2012, p.41; Kotler & Bliemel, 2001, p.657; Dibb et al., 2012, p.59).
Initially, the focal company, which conducts the analysis, should identify key
competitors and consider whether they represent a direct or indirect threat. Direct
opponents supply a similar product to the target group or make use of similar
technologies. Indirect ones typically offer products or services at least in the same
product category. Likewise, they supply products and services that satisfy the same
basic need. Competition could also stem from indirect competitors that are targeting
customers with the same spending power. Next, the objectives competitors pursue
need to be appraised. Goals of competitors can be very diverse, such as
technological leadership or market share growth. Therefore, understanding the mix
of the objectives a competitor focuses on gives an insight how aggressively or
defensively it could respond to a certain action.
Another major component a competitor analysis should include is the assessment
of competitors’ strategies. Thereby, the focal company especially has to develop an
understanding of competitors’ strengths and weaknesses .Yet, the strategies ought
to be examined separately since a one-size-fits-all analysis would only come up with
a lacking image of potential threats and opportunities stemming from a rival.
Last but not least, in conducting a competitor analysis the opponents’ behaviour
should be investigated, which implies that the focal company needs to develop an
understanding for their role perception. Insofar, the prediction of a competitor’s
behaviour denotes another integral outcome of a competitor analysis. This indicates
that the potential response to a general change on the market or the reaction to a
strategic move of a rival should be investigated. Similarly, the analysis should
estimate the likelihood of an active and aggressive move a competitor might plan.
To sum up, academic literature has broadly agreed that a competitor analysis should
address certain strategic questions in order to pursue the overall goal of developing
a competitive advantage.

22
3.2 “Traditional” Models for Conducting a Competitor Analysis
In the previous section a general outline of the major strategic questions a
competitor analysis should give answer to, such as objectives, positioning or the
assessment of strengths and weaknesses, was given. This upcoming section will
discuss how academic literature suggests to structure the components of the
analysis as well as which models or tools are suitable for use. Thereby, an overall
framework or approach for competitor analysis will be presented. The intention is to
present “traditional” tools and models as part of the respective steps in the analysis
in such a way as it was suggested by academic literature regarding competitive
strategy. In the empirical part of this thesis the tools will be tested with the help of
the results of the qualitative data regarding their factual usage among
entrepreneurs. It should be mentioned, that concrete approaches, models and tools
on how start-up companies conduct a competitor analysis have hardly been found
in academic literature. Therefore, the next but one section will primarily cover
applied concepts and ideas for start-ups by academic as well as non-academic
sources from the internet such as blogs, articles or forums.
3.2.1 A Step-by-Step Approach
As a reference framework that is basically applicable for all stages of company
development Hussey (2007, p.190) suggests a general approach comprising eight
major stages in order to assess the situation of an industry and its competitive
environment. To achieve the overall goal of building a competitive advantage the
ring structure of this framework “follows a logical sequence. It is recommended that
the sequence is maintained, even if some steps are omitted, because each step
provides information which is useful to the steps that follow”.

23
Source: Author’s graph referring to Hussey (2007)
According to Hussey (2007, p.190), the industry analysis as first stage “is a way of
looking at the relative power of all the players in the chain of supply through to
consumer. The purpose is not just diagnosis, but should lead to strategies to
improve the position of the company”. Correspondingly, the industry mapping should
then present the results of the analysis. Similarly, the critical success factors should
be “derived from industry analysis, and used as one element of competitor analysis”.
Following the next step, in the competitor profiling strategic information of each
relevant rival is being depicted in a kind of register. The visualisation of this
information can provide a source of competitive advantage, since potential strategic
weaknesses and response scenarios might become apparent. The special
competitor analysis is then intended to shed lights on particular aspects of a rival’s
strategy, for instance, products and production methods or market presences. In
order to identify opportunities for differentiation relative to the market and
competitors the value chain analysis contributes on the achievement of a
competitive advantage. However, goals should be formulated in a clear or
Industry Analysis
Industry mapping
Critical success
factors
Competitor
profiling
Special
competitor
analysis
Value chain
analysis
Benchmarking
Building
competitive
advantage
Graph 2: Step-by-Step Approach

24
measurable way. Therefore, the use of benchmarking could lead to improved
performance regarding a specific aspect of the business. Lastly, a sustainable
competitive advantage will only exist if a company’s business model is being
continuously adapted in order to maintain or strengthen its position in the market. In
the following subsections, the stages will be shortly described and subsequently
practical tools will be presented according to their feasibility for the respective
research steps.
3.2.1.1 Industry Analysis
In their chapter on competition and positioning Cabage & Zhang (2013, p.65)
highlight the importance of entrepreneurs’ understanding of the fundamentals of
competitive analysis and positioning. They argue that “an inexperienced
entrepreneur focuses exclusively on building a great product, finding product-market
fit, and improving user experience. While these are excellent goals, they assume
that entrepreneurship occurs in a vacuum, without the effects of any competition”.
Michael E. Porter’s Five Forces model denotes the probably best known tool for
analysing the attractiveness of an industry. In his first chapter about the structural
analysis of industries, Porter (1980, p.3) approaches his model by stating that
“competition in an industry is rooted in its underlying economic structure and goes
well beyond the behaviour of current competitors. The state of competition in an
industry depends on five basic competitive forces…the goal of competitive strategy
for a business unit in an industry is to find a position in the industry where the
company can best defend itself against these competitive forces or can influence
them in its favour”. Porter (1991, p.100) adds that “the industry structure framework
can be applied at the level of the industry, the strategic group (or group of firms with
similar strategies) or even the individual firm. Its ultimate function is to explain the
sustainability of profits against bargaining and against direct and indirect
competition.” As the Five Forces model represents a commonly known tool for
industry analysis, the researcher indents to rather explain implications relevant for
online oriented start-ups, which relate to aspects of modern communication
technologies (Cabage & Zhang, 2013, p.66).

25
Source: Author’s graph referring to Porter (1980, p.4)
Profitable and emerging markets (e.g. online business models) will naturally attract
new competitors, who could copy the business model of existing market
participants. Therefore, creating barriers to entry can become a source of
competitive advantage. Regarding the threat of substitute products, Cabage &
Zhang argue that not only competitors with equal products, but rather those
satisfying same needs with different ones denote a major threat. On the bargaining
side, customers in many cases have gained power due to present day digital access
to information. For instance, via online comparison portals they can easily search
for product categories and compare offerings among suppliers. Unlike to customers,
suppliers’ power shows a different dynamic. Increasing switching costs for
customers or the dependence on the supplier can be therefore an effective strategy.
Last but not least, the competition within the industry represents the ultimate
decision factor which determines if a company should enter a market. Hence, the
industry structure, such as a monopolistic, oligopolistic but also fragmented markets
needs to be clearly analysed. Similarly, opportunities for differentiation and
innovation should be taken into account, in order to achieve a competitive
advantage. The Five Forces model is not a tool perfectly eligible for analysing an
Rivalry
among the
industy
Bargaining power of
suppliers
Bargaining power of
buyers
Threat of new
entrants
Threat of substitute
products
Graph 3: Porter’s Five Forces

26
industry, since markets are not static and competitive behaviour is also affected by
many other factors.
Hussey (2007, p.194) mentions several other generally relevant factors that newly
entering companies should observe in particular.
Especially in new industries high growth rates usually attract new entrants, thereby
causing fierce competition. By contrast, industries that show lacking profits among
market participants will become less predictable and probably could cause
aggressive competitive behaviour. Alike, competition will be likely to intensify if
market participants follow an economies of scale strategy. As a result, others need
to start following a low-cost approach as well. Thus, the easier it is to differentiate
one’s product, the less fierce competition will be generated. Yet, if industries are
very fragmented, the competition is still high, even if there is no clear market leader.
As a result, if market entry barriers are low, this typically indicates that a market is
fragmented.
Based on the results and implications of the Five Forces model, Porter derived that
there are three consequent general strategic approaches that can be applied across
market segments. In the following paragraph, the core ideas of the so-called Generic
Strategies will be presented. (Porter, 1980, p.39; Cabage & Zhang, 2013, p.68).
Source: Author’s graph referring to Porter (1980, p.39)
Low Cost
Uniqueness of
Product/Service
Industrywide
Overall Cost
Leadership
Differentiation
Particular
Market
Segment
Focus Strategy
(low cost)
Focus Strategy
(differentiation)
Graph 4: Porter's Generic Strategies

27
The first strategy, which follows a low-cost approach, can be mainly achieved by
fostering economies of scales. Therefore, it may require high capital investments
and aggressive pricing strategies in order to increase the market share.
Consequently, this strategy leads to a valuable defensible and profitable position, if
no competitor can compete on the price anymore. Despite of the high financial
requirements, Kim et al. (2004, p.574) interpret this strategy differently in the context
of the digital age and argue that the cost leadership strategy can denote a choice
for companies engaged in the e-business. From the customer point of view the
strategy “may be particularly appealing to online buyers who are price sensitive”.
Given the possibilities of comparing prices and seeking information on products via
the internet the buyers’ bargaining power has significantly risen. Consequently, firms
“conclude that they have no other choice but to pursue a strategy of cost leadership”.
This relates to the fact that the digital age has significantly undermined the idea of
differentiation due to a lacking tangibility of virtual business.
The goal of differentiating a product, which is the essence of the second major
strategy, is to be not in the same category as the cost leader. Porter finds that
differentiating a product means “creating something that is perceived industrywide
as being unique…ideally, the firm differentiates itself along several dimensions”
(Porter, 1980, p.38). Not only the product itself but also any other aspect of the
business model such as brand image, reputation, technology, product features,
networks, and customer service can serve as a source of differentiation (Kim et.al
(2004, p.575). This in turn, can create viable entry barriers that are difficult to imitate
and provides “insulation against competitive rivalry because of brand loyalty by
customers and resulting lower sensitivity to price.” (Porter, 1980, p.38). Similarly,
thanks to increased customer loyalty the threat of substitute products might be
mitigated. However, differentiation demands higher costs due to necessary
research, product design, high quality materials, customer support or other factors.
Insofar, customers might not always be willing to pay the required higher product
prices. Kim, et.al (2004, p.575) find that e-businesses should follow differentiation
strategies due to the internet’s lower switching costs. By product differentiation
customers will be less encouraged to switch suppliers despite perfect information.
Given the emergence of the internet, sources of differentiation have also developed

28
aspects such as speed of delivery, transaction security or online shopping
experience that can contribute to locking in customers.
By focusing on a specific niche target segment, product line or geographic region,
instead of the industrywide low-cost or differentiation approach, Cabage & Zhang
(2013, p.68) argue that this strategy should represent the preferred one for startup
companies which enter an industry where primary and secondary competitors
already exist. In this context, the focus strategy indicates to concentrate on the
“narrow strategic target more effectively or efficiently than competitors who are
competing more broadly. As a result, the firm achieves either differentiation from
better meeting the needs of the particular target, or lower costs in serving this target,
or both” (Porter, 1980, p.38). However, if the target group is too narrowly defined
the major trade-offs are lower profitability and sales volume, which can seriously
affect the survival of a newly founded start-up company. Nevertheless, referring to
Kim, et.al (2004, p.576) “the lower levels of investment required by many online
businesses means that they enjoy lower break-even points than competitors with
higher levels of fixed costs. Thus, targeting even small market segments might be
viable, and consumers may be easily connected with companies that focus on niche
markets due to the internet’s search advantages“. Especially the possibilities of the
internet to micro-segment and fragment markets facilitate the process for online
businesses to match specific buyer needs with their highly differentiated products,
thereby charging higher prices. Kim, et al. even further comment that online
businesses need to follow the focus strategy, since its fragmentation capabilities
exhibits a source of competitive advantage. Consequently, they conclude that
“…scalability and market scope flexibility – the ability to serve simultaneously (or in
quick succession) broad markets and very small market niches – are hallmarks of
internet technologies” (2004, p.577).
3.2.1.2 Industry Mapping
Having conducted an industry analysis as first major step toward developing
competitive intelligence, the forces and principles that characterise an industry have
been identified. Yet, in order to gain a deeper understanding of the interconnections

29
within an industry Hussey (2007, p. 201) suggests to develop a so-called industry
map. “In industry mapping an attempt is made to plot the whole chain from first
supplier through to final consumer, examining the relationships of each link in the
chain”. Compared to academic literature, consulting and intelligence companies
also recognise the importance of industry mapping, which serves as a valuable tool
for developing strategies and understanding the competitive environment (The
Knowledge Agency [TKA], 2015). Similarly, the so-called market map concept
“defines the distribution and value added chain between final users and suppliers,
which takes into account the various buying mechanisms found in a market,
including the part played by influencers” (McDonald, p.127, 2009). In his approach
to industry mapping, Hussey begins to define the industry structure in form of a
diagram by “thinking of the logical ways in which business might flow through the
channels” (2007, p.201). Next, the diagram is related to available market research
information which will then be integrated into the drafted blocks that depict the
industry participants. In other words, the factors of the industry analysis according
to Porter’s Five Forces are integrated into the map. As a result, the map provides
an overview from the forces which affect competitive behaviour among the players.
Especially for the competitor profiling and following steps in the general competitor
analysis approach industry mapping allows to derive valuable strategic implications.
Furthermore, Hussey argues that by mapping the industry, many misperceptions
about the industry forces and structures can be clarified. Consulting companies refer
to its benefits for market segmentation and to consequently correctly identify the
target group. Similarly, changes in the value generation processes can be better
displayed through the channels in a market (Market Segmentation Company, 2014).

30
Source: Market Segmentation Company (2014)
From the point of view of a start-up company, the market mapping step, as part of
the competitive analysis, proves to be useful especially regarding those factors that
generate value. Likewise, start-ups can develop a first understanding of the market
size as well as segments, thereby quantifying assumptions about their own
projected market share (Haden, 2013).
3.2.1.3 Critical Success Factors
According to Benjamin & McDowall (2010, p.20) “a critical success factor (CSF) is
defined as an operational business or corporate function, or competency, that a
company must possess in order for it to be sustainable and profitable”. Hussey
(2007, p.208) argues that critical success factors mark the essential aspects of a
certain industry that companies have to deal with in order to stay competitive. As
these core factors apply to all competitors of a respective industry they “provide a
useful standard for measuring both one’s own performance against them and that
of key competitors”. However, as industries can be broken down into various sectors
and segments due to differentiation of market participants CSFs can also differ.
Alternative sources from the internet (Strategic Management Insight [SMI], 2015)
also comment that CSFs usually vary among different strategic groups. Thus, it is
clear that CSFs depend on the individual structure of a particular industry and that
Graph 5: Example Market Map

31
not all key areas a company has to deal with are of equal importance. SMI (2015)
lists various typical CSFs such as market share, product range or distribution
network. Regarding the overall approach of the competitive analysis the assessment
of CSFs denotes an integral part. Next, these will be matched against the key
competitors in the competitor profiling to assess their strengths and weaknesses.
3.2.1.4 Competitor Profiling
Referring to Hussey (2007, p.210) industry analysis and mapping intend to clarify
which forces are involved in a certain market and how these affect competitive
behaviour. Consequently, the most relevant competitors should be identified, which
are then subject to an individual analysis. Therefore, this upcoming stage of
competitor analysis in the overall approach should contribute to several strategic
aspects depending on the respective position of the focal company. Apart from the
identification of competitors, an appropriate strategy should be formulated in order
to retain the respective position as well as to find sources of competitive advantage.
Likewise, this step should prepare the company for potential competitive reactions.
O’Connor (2010, p.48) highlights the competitor profiling matrix (CPM) as a first
major step (“knowing your enemy”) in his overall approach to competitor analysis.
This matrix compares the focal firm in broad categories to key competitors in order
to provide “an informed basis for developing positioning strategies to achieve a
competitive advantage”. Therefore, comprehensive information about competitors
should be gathered first (O’Connor, 2010, p.49; Hussey, 2007, p.211). To name just
a few, typically KPI data about marketing, or financial sales figures, but also general
information about products, company structure, target markets or others need to be
collected.
Having compared the different sources it can be stated that a competitor profiling
can be depicted in multiple ways. O’Connor (2010, p.49) suggests to design a two-
dimensional matrix with the focal firm and competitors along the top and critical
success factors on the side.

32
Source: Author’s table referring to Strategic Management Insight (2015)
Referring to SMI (2015), the critical success factors should be assigned additionally
to a weight framing according to their importance as well as to a rating for the
competitor’s factual performance in the respective field. As a result of the weight
multiplied by the rating, each factor has an individual score, which can be then
summarised in a total one. The CPM represents a viable tool to quantify a key
competitor’s performance as well as to recognise the strongest industry participant.
Thereby, its relative strengths or weaknesses regarding a certain factor can be
identified. Thus, the CPM denotes a simple but effective way to quantify competitive
intelligence data, which provides a valid base for deriving strategic conclusions.
Table 3: Excerpt from a Model Example for CPM
Company A Company B
Critical Success Factor Weight (0-1) Rating (1-5) Score Rating (1-5) Score
Brand reputation 0,13 2 0,26 3 0,39
Market share 0,14 2 0,28 4 0,56
Product range 0,05 3 0,15 1 0,05
Distribution channels 0,07 4 0,28 2 0,14
… … … … … …
TOTAL SCORE … … … … …

33
3.2.1.5 Special Competitor Analysis
According to Hussey (2007, p.217) the profiling steps are the most time-intensive
within the overall competitor analysis. Still, studying specific aspects of competitors
in detail, such as a certain behaviour, competence or functional area, represents a
useful approach to creating competitive advantage. At this point, O’Connor’s four-
step concept can be mentioned (2010, p.48), which mainly corresponds to the tasks
that have been so far fulfilled in the overall step-by-step approach. After having
identified the key competitors (“know your enemy”), their performance regarding
specific critical success factors was depicted in the CPM (“rate your enemy”). These
results indicated the individual and overall scores of the competitors. Hence,
competitors can be ranked according to their strengths and weaknesses. Next,
O’Connor (2010, p.52) proposes to conduct a competitor positioning strategy
(“position your enemy”), which defines how the focal firm can differentiate its
products or services from its rivals. Elaborating a competitor positioning strategy
should, on the one hand, incorporate the development of a defensive positioning, in
order to discourage an opponent from taking a competitive action. On the other
hand, an offensive strategy should be formulated for the attainment of a competitive
advantage as well. Finally, in his last step (“defeat your enemies”) O’Connor
proposes to develop a positioning strategy with current and target activities, such as
the improvement of a unique value proposition that cannot be easily imitated.
Dibb et al. (2012, p.251) consider positioning as the final component of the so-called
STP process (segment, target, position) of market segmentation. “Positioning is not
what is done to the product, it is what image is created in the minds of the targeted
consumers or business customers. The product is positioned in the minds of these
customers and is given an image”. Therefore, the so-called perceptual mapping
denotes a commonly used tool for the graphic depiction of consumers’ perceptions
as well as their prioritisation of brands and their perceived attributes. After having
defined the segments of a particular market, the focal company needs to understand
the respective customers’ perceptions, needs and expectations regarding the
product. Consequently, competing products need to be evaluated according to their
positioning and images perceived by the target customers.

34
An image for the product of the focal firm should be selected, which clearly and
credibly differentiates it from competing ones.
Source: Author’s graph referring to Dibb et. al (2012, p.252)
The same principle of product positioning can be applied to companies as well. The
attached graph shows a hypothetic example, whereby the two axes denote key
characteristics of the market. To sum up, in conducting a specific analysis of
competitors, it is essential to define the rival’s position in the market. As a result, the
finding of one’s own strategic position should be facilitated and valuable criteria for
differentiation can be developed.
3.2.1.6 Value Chain Analysis
In Hussey’s next step, he refers to Michael E. Porter’s value chain analysis as a
popular method for separating the value-creating activities of a firm as part of the
overall industry value chain in order to “identify underlying areas of competitive
advantage” (2007, p.217). Price (2011) comments on to the concept that companies
entering an industry perform value-creating activities which are interconnected with
those of other industry participants such as suppliers or end-users.
Graph 6: Perceptual Mapping Example

35
Thereby, the profit margin as a mark-up of the final result of the activities should be
covering costs that accrue from the value-creation process. In other words,
organisations add value to a product or service of an industry value chain by carrying
out activities that convert inputs into outputs.
Source: Author’s graph referring to Porter (1980)
The value chain analysis model according to Porter differentiates between primary
and support business activities (Grant, 2013, p.112; Price, 2011). Primary activities
include inbound and outbound logistics, operations, marketing and sales as well as
service. By contrast, firm infrastructure, human resource management, technology
development and procurement indicate support activities. As details about the
typical activities are shown in the attached graph, the implications and conclusions
that can be derived for entrepreneurs will be subject to further analysis in the
following paragraph.
The goal of a value chain analysis is to identify the most valuable activities of a
company which could provide a competitive advantage in form of a cost or
differentiation advantage. Although only primary activities directly add value, both
types of activities denote equally important steps in the value creation process. It is
argued that support activities typically denote a source of differentiation advantage,
while cost advantages can be easier achieved by optimising primary activities (SMI,
Support
Activities
Firm infrastructure
General Management,
Legal, Accounting etc.
Human Resources
Management
Recruitment, Training etc.
Technology Development
R&D, Process and Product
Design etc.
Procurement
Purchase of raw materials
etc.
Primary
activities
Inbound
Logistics
Warehousing,
storage,
inventory
control,
transportation
planning etc.
Operations
Conversion,
assembly,
packaging,
maintenance
etc.
Outbound
Logistics
Order
processing,
delivery,
shipment etc.
Marketing
and Sales
Sales
channels, 4
Ps, customer
value, sales
force etc.
Service
Customer
support,
training,
installation
etc.
Graph 7: Value Chain Analysis

36
2015). As a first step those activities that contribute the most to the creation of
customer value should be identified. Next, differentiation strategies that improve
customer value should be evaluated such as adding more product features, focusing
on customer service, customisation or complementary products. It is the
combination of interrelated activities and differentiation strategies that will provide
the most sustainable source of competitive advantage by improving customer value.
Grant (2013, p.181) supports the applicability of the value chain by indicating that
“the key to successful differentiation is matching the firm’s capacity for creating
differentiation to the attributes that customers value most. For this purpose, the
value chain provides a particularly useful framework”.
Price (2011) recommends the value chain analysis as a valuable tool to help start-
ups analysing their ecosystem and thus the network of all its stakeholders including
competitors, partners, suppliers, customers, investors and so on. After having
identified the players in an industry, business models and therefore value chains of
the participants should be broken down in order to determine their core
competences. By disaggregating the value chains entrepreneurs can not only
develop a better understanding of cost structures but also of inefficiencies in the
value generation process. As markets constantly develop, so-called value gaps
provide the ideal foundation for a new venture. If exploited properly, value gaps have
the potential to disrupt markets.
To summarize, the value chain concept provides a valuable tool for analysing the
value generation process of an industry, competitors and the focal firm itself,
wherefore potential value gaps in the ecosystem can be detected. These gaps can
provide a source of disruption of long-established and inefficient industry concepts.
3.2.1.7 Benchmarking
As a subsequent step Hussey (2007, p.192) lists benchmarking, which aims to
compare certain business processes or performance metrics such as KPIs with
competitors inside and outside of an industry. Measuring benchmark indicators
represents a quantitative tool that can optimise one’s performance in a certain area
of business. Otherwise one would not know how much better or worse a task is

37
performed. Apart from improving company performance, SMI (2015) adds that
further benefits of benchmarking may include the discovery of successful business
processes, which can be observed in competitors and then applied. Similarly,
relevant information about sources of competitive advantage can be gained by
applying best practices from other industries.
As start-up companies usually work under uncertainty and a lack of historic data,
tracking or obtaining relevant competitive intelligence is not an easy task. However,
opportunities to gather data have increased, due to new web-based performance
tracking technologies. Nowadays, new software technologies even offer
benchmarking tools that provide automated data collection, thereby channelling the
information into dashboards. As a result, KPIs and benchmarks across several
categories can be viewed (Empson, 2013). Thus, based on algorithms using big
data, start-up companies can assess their performance according to the analysis of
comparable figures from competitors. However, even if benchmarking represents a
tool that can be used to follow a strategic plan, purely focusing on the meeting of
performance indicators should be avoided (Lesonsky, 2012).
3.2.1.8 Building a Competitive Advantage
Following Hussey’s (2007) framework for competitor analysis, the last step is the
development of a competitive advantage. In fact, academic literature, as mentioned
in previous subsections, has broadly agreed on the overall goal of a competitor
analysis to derive knowledge for the establishment of a competitive advantage.
Repeating Barney’s (1991, p.102) associated definition of value creating strategies
as means of ensuring that products cannot be easily and immediately imitated by
competitors, Grant (2013, p.156) comments that competitive advantage can be
considered the result of matching internal strengths to external success factors.
Nevertheless, as “it is created by change, once established, it sets in motion the
competitive process that leads to its destruction”. Consequently, a sustainable
competitive advantage needs a continuous improvement as rivals will try to emulate
it (Hussey, 2007, p.192). Grant (2013, p.157) moreover indicates that competitive
advantage emerges by changes resulting either from external or internal sources.

38
On the one hand, external sources of change can be events such as switching
customer demands, upcoming market trends or new technologies (changes among
the PEST factors). Since external changes create entrepreneurial opportunities,
companies that seek to be responsive should be able to anticipate changes in the
market environment. Likewise, they should quickly adapt to trends or other
disruptive events, in order to best exploit these sources of competitive advantage.
On the other hand, competitive advantage may be generated by internal innovation,
such as the development of new products or processes that involve modern
technologies as well as new business models. These strategic innovations imply
“pioneering along one or more dimensions of strategies” (Grant, 2013, p.158).
Firstly, companies could develop products or services that create whole new
markets (cf. Blue Ocean strategy in subsection 3.3.3). Secondly, they could adapt
existing product concepts to attract new customer segments. Thirdly, by introducing
modern approaches in existing industries, they could create customer value, which
can then establish new sources of competitive advantage.
SMI (2015) complements that the internal generation of competitive advantage of
the aforementioned sources should be developed according to the so-called VRIO
model. Companies that develop their resources based on the VRIO factors
(valuable, rare, hard to imitate and organised) will have at least a temporary
competitive advantage as their emulation will require significant amount of time. The
VRIO framework represents a tool that analyses a firm’s internal resources and
capabilities, thereby investigating whether they would qualify as sustainable
competitive advantage. The following graph depicts the principles of the model
according to Barney (1991, p.112) who first introduced it.

39
Table 4: The VRIO Model
Valuable? Rare? Costly to
imitate?
Company organised enough
to capture the value?
Competitive implication
No Competitive disadvantage
Yes No Competitive parity
Yes Yes No Temporary competitive
advantage
Yes Yes Yes No Unexploited competitive
advantage
Yes Yes Yes Yes Sustained competitive
advantage
Source: Author’s table referring to Barney (1991)
A resource is considered valuable, if it provides opportunities to companies that they
can exploit, or provides protection against competitive threats, as well as if it
increases differentiation. Resources that do not deliver any value lead to competitive
disadvantage. Resources are considered as rare, if only very few companies are
able to acquire them. Therefore, rare and valuable resources denote at least a
temporary competitive advantage. By contrast, valuable but commonly accessible
resources lead to competitive parity, due to the development of similar strategies
among competitors. As soon as a resource is costly to imitate, expensive to buy or
difficult to substitute, the company can achieve a sustained competitive advantage
with it. Yet, the resource itself does not necessarily result in a competitive
advantage, as long as the company is not organised enough to capture the value
originating from the resource. Insofar, organisational structures such as processes,
management systems and policies need to be implemented in order to obtain a
sustainable competitive advantage. SMI (2015) lists intellectual property, patents,
brand equity, know-how or reputation as typical resources that have VRIO attributes
and therefore exhibit the potential of sustainable competitive advantage. Especially
when conducting a value chain analysis VRIO resources can be often detected.

40
Referring to Porter’s Generic Strategies, Grant (2013, p.163) concludes that
differentiation or cost advantages form the two basic types of competitive
advantage. “A firm can achieve a higher rate of profit (or potential profit) over a rival
in one of two ways: either it can supply an identical product or service at a lower
cost or it can supply a product or service that is differentiated in such a way that the
customer is willing to pay a price premium that exceeds the additional cost of the
differentiation. In the former case, the firm possesses a cost advantage; in the latter,
a differentiation advantage.”
The following graph summarises the aforementioned findings.
Source: Author’s graph referring to Barney (1991); Grant (2013); SMI (2015)
How to achieve a sustainable competitive advantage?
Through external
changes
Changes in the market
(PEST factors):
switching customer
demands, market trends,
new technologies,
disruptive events etc.
Depends on firm's abilty
to anticipate
environmental changes
and to quickly repsond to
it
Through internal
innovation
Development of new
products, processes or
business models
Innovations could qualify
as VRIO resources
Innovations can be
implemented in new
industries, new customer
segments or new sources
of competitive advantage
can be found
Basic types of
competitive
advantages
Differentiation
advantage
Cost
advantage
Graph 8: Summary of Competitive Advantage

41
3.3 Entrepreneurial Approaches to Competitor Analysis
In the previous section, the traditional point of view on the topic of competitor
analysis was given. Based on academic literature, tools, models and an overall
framework on how to approach the topic of competitor analysis were presented in
order to address the associated major strategic questions. Yet, this perspective
rather concentrated on competitive situations that established companies deal with.
Hence, the upcoming section focuses especially on newly founded ventures,
thereby taking into account the differing circumstances start-up companies have to
face. Insofar, attention was also given to the preconditions such as that start-ups
usually lack resources (time, funds, personnel etc.) for the conduction of a serious
competitive analysis. Similarly, start-ups consequently exhibit altering needs
regarding their competitive knowledge. It seems obvious that newly founded
ventures do not need to conduct a profound and costly competitor analysis
comparable to an MNC that has to defend its market position. Instead entrepreneurs
should conduct competitive analysis so that the market gap has been clearly
identified and ways how to differentiate their products from big players or other
similar market entrants have been found. Furthermore, as founders often need to
proof their company concepts to investors such as venture capitalists the
“competitive justification” should be easy to be illustrated for pitching presentations.
The following section will present easy-to-use frameworks and tools for competitive
analysis at the entrepreneurial level. As already previously mentioned, academic
literature hardly focuses on the start-up level for competitive information gathering,
thus alternative online sources had to be utilised as well. Thereby, especially the
ideas of opinion leaders in the entrepreneurial world such as Steve Blank, venture
capitalists or common practices among start-ups like the use of the Strategy Canvas
and Blue Ocean strategy will be presented.

42
3.3.1 The Four Start-up Market Types According to Steve Blank
Just because of their origin, start-up companies do not necessarily resemble each
other. Apart from the different products and services offered, start-ups should be
differentiated according to the market which they aspire to enter. Steve Blank finds
that start-ups exhibit four basic options of market entry, with each of them having
different requirements for success. Whereas the first one represents the classic
entry into an existing market, the second one refers to the creation of a new market
or market disruption (Blue Ocean strategy). The third type of market entry can be
divided up in to a re-segmentation strategy of an existing market either following a
low-cost, or a niche approach.
Blank (2007, p.23) comments that “it is a fallacy to believe the strategy and tactics
that worked for one start-up should be appropriate in another. That is because
market type changes everything a company does“. Subsequently, he concludes that
several associated factors, such as customer needs and feedback, adoption rates,
product features, positioning, launch strategies or channels and activities depend
on the market type (Blank, 2014). Many start-up forums, journals and blogs across
the internet utilise Blank’s four market types (MaRS, 2011; Blank, 2012). Therefore,
the implications of the four different market types will be discussed in the following
subsections.
3.3.1.1 Entering in an Existing Market
Existing markets provide the advantage that customers know the product and do
not need to be educated anymore about their attributes. They “describe the market
and the attributes that matter most to them” (Blank & Dorf, 2012, p.39). However, it
is therefore particularly difficult to market a product since features for differentiation
are reduced to better performance. This means that competitors are widely known
wherefore competition is based on marketing the right product features (Blank,
2007, p.24). “The idea is that in entering an existing market, positioning is all about
the product and specifically the value customers place on its new features” (Blank,
2007, p.55). At this point, Blank suggests to ask the typical questions that have been
already posed in this thesis: who are the competitors, what are their market shares,

Master Thesis Sebastian Guth - Developing a competitor analysis canvas model for start-ups in the pre-seed phase

Master Thesis Sebastian Guth - Developing a competitor analysis canvas model for start-ups in the pre-seed phase

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