Our market economy is built around the premise that competition makes everything more efficient and better over time. For most products and services a careful analysis of the competitors is very important to your success.
This market analysis applies to all aspects that you can glean from your competitors. The product features and design, quality of service are obvious things for the engineer in you to look at for hints about what you can do better with your product. Business models, marketing and sales strategies are just as important to your success so look to those too for ideas that can be improved on.
Importantly, if you are planning a business idea and can’t be better than the competition in enough ways to matter DON’T WASTE YOUR TIME.
It’s an approach right out of Apple’s playbook. Only enter a market where you know you can dominate with a superior product.
As an App developer it has become interesting to see the marketplace evolve into a much more competitive space over the course of a few years. With the vast amount of successful apps being free it’s impossible to compete on price, the race to the bottom has already finished. To develop a successful app now requires a great design, superb artwork, discoverability and viral tools for additional distribution, good marketing, and positive reviews. There are only 100 apps in the top 100 highest grossing list, and those apps are (for the most part) doing all those things.
To have a great app idea and expect it to be a hit without addressing all these things that your competitors are doing is naive.