The Influence of Competitor Analysis Upon The Business Model CANVAS of AdVision Start-up

Introduction

The purpose of this project is to find out how can competitors’ analysis influence the business model (BM) CANVAS of AdVision advertising start-up firm.

The researchers believe that in doing so they can not only gain a better understanding of the competitive environment in Bulgarian market, but they also can come up with appropriate solutions for the barriers that may arise from competitor analysis and may affect BM Canvas blocks such as: value proposition, costs, partners, resources, customer relationship, etc.

Moreover, John A. Czepiel and Roger A. Kerin mentioned in their article - Competitor analysis – that by knowing who are the competitors of a firm, what strategy are they using, what are their weaknesses and strengths, will allow to a marketing strategist to “position the firm's offerings such that they minimize direct competition either by choosing vulnerable competitors or by pitting strength against weakness”.

Also, as Michael R. Hunter specifies, by knowing the competition in an industry, can offer some other advantages such as: it can be learned from their mistakes, it can be modelled what works for them and ultimately the competitors can reveal opportunities in market place by specifying the segments of the marketplace and customers they are targeting. (http://michaelrhunter.com/, 2014)

The immeasurable importance of knowing the competitors makes the topic of competitors’ analysis and their influence upon business model CANVAS and start-ups, in general, very interesting from both practical and academic point of view.

Having the above information in mind, the authors of the present project considered that by researching and applying the theoretical knowledge, obtained during their studies, to AdVision start-up, one can ultimately gain a deeper and better understanding of the whole competitors’ analysis concept and be able to make valid suggestions for solving the problems arisen as an outcome of this analysis.

1. Problem formulation

Competitor analysis influence upon the business model CANVAS of AdVision start-up

1.1 Problem Statement

As it was aforementioned the main focus of this written report lays upon the effects of the competitors’ analysis outcome upon BM CANVAS of AdVision.

Considering that 46 % of the start-ups fail due to lack/ poor analysis of the competitors, this topic is wide of opportunities and different possibilities to be approached. (http://www.statisticbrain.com/)

This fact makes the topic even more alluring and relevant. In order to be more specific and practical, the authors decided to take into analysis a start-up company from the advertising industry that can help in achieving the purpose of this project.

The proposed problem can lead to a main research question as follows:

How can competitor analysis affect the business model CANVAS of AdVision and what can this start-up do in order to ensure itself an effective entry in the advertising industry?

1.2 Sub-questions

1. Who are the competitors of AdVision and what are their capabilities and strategies?

2. How intense is the rivalry between AdVision and its competitors; what is the likelihood of attack or response towards AdVision’s entry on the market?

3. What parts of AdVision’s business model might be affected by competitors’ analysis outcome and what can this start-up do in order to have a successful entry on the market?

The above questions aim to help the authors to get a deeper understanding of the competitors’ analysis concept as well as their influence upon costs structure, revenue, customers’ relationships, resources, partners or value proposition itself for a start-up company.

Consequently, the first question will help the authors to identify who are the competitors of AdVision based on their market profile (or market commonality) and their resource endowments and how good are they compared to the focal firm.

By comparing AdVison with its competitors along these two dimensions, will help to “illuminate the pre-battle competitive tension between these firms and to predict how the focal firm may interact with each of its competitors.” This means that by making the competitors analysis, the researchers of this project will be capable to understand and predict the intensity of rivalry between AdVision and its competitors “in their quest for a competitive position in the industry”; fact that fulfils the role of second question. (Chen, 1996, pg.100-101)

Finally, as a logical flow of this research the third question will aid the authors to identify the blocks from BM CANVAS that need to be changed or improved in order to create a competitive advantage for AdVision.