THE BLOG
12/22/2014 10:17 am ET Updated Feb 21, 2015

Competing With Industry Giants? 5 Keys to Winning in the Niches

When the elephants fight, the grass suffers (African proverb). Don't pick a fight with the elephants of your industry. Don't play in the field where they are fighting. You don't need the elephants to lose for you to win. You just need to avoid getting trampled. And you need to think through five essentials: Conditions, Customers, Competitors, Collaborators, Capabilities.

Elke Goversten has done this well at parenting magazine, Mamalode. As a small player in a declining industry Elke knows her organization's survival depends upon avoiding the wrath of the big players. Elke told me it's all about "focus and flexibility" while choosing to "only exist in a business model that was as meaningful as our product."

She went on to say,"If we don't know what to do, we do the opposite of the big guys." In particular, they are flipping the platform from writers writing on the Mamalode platform to Mamalode publishing on writers' platforms and "developing models to scale print in a meaningful way in collaboration with print partners like hospitals". Their growth (and they are succeeding and growing) is coming through their ability to leverage other platforms that the big players in their industry haven't even considered.

This is a classic case of Zigging when your competitors Zag. Worst choice: compete with industry giants head-to-head with commodity products. Better choice: differentiate into product niches the giants either don't care about or can't compete in -- or even better, follow Mamalode down the path to differentiated, protectable business models.

Think in terms of: Conditions, Customers, Competitors, Collaborators, Capabilities.

Conditions

Those that put customers first don't survive against industry giants. Why? Because that's exactly what the industry giants do. Going there means direct competition with those giants - where you will get trampled like grass.

Instead, dig into social and demographic trends, political, governmental and regulatory fronts, macro and micro economic trends, and market definitions including inflows, outflows and substitutes.

Customers

Then turn to customers. If the industry giants are already serving all the needs of all the potential customers and doing it well, give up. Go play somewhere else. But there is most likely a gap in the market. Not all of us can do what Tony Hsieh did and find an industry in shambles like the retail shoe industry creating the opportunity for Zappos, but you should be able to find some unmet or underserved needs.

By the way, that unmet or underserved need could be anywhere along the value chain from first line customers to end users to influencers. Dig into their needs, hopes, preferences, commitments, strategies and price/value perspectives.

Competitors

Having looked at customers and potential customers, examine your competitors. You can't stay out of the way of the giants without knowing where they are and anticipating where they are going. Reconstruct their strategies, profit/value models, profit pools by segment and source of pride. Know that if you attack what they hold dear, they will come after you. The objective is to carve out something they don't care about so it's in their best interest to ignore you.

But don't ignore the rest of the industry. This includes other players and other potential players. You're looking for blue oceans, not just smaller blood baths.

Collaborators

Collaborators are those that will benefit from your success. These could be suppliers, business allies, partners, government/community leaders. In an industry dominated by giants, the balance of power is skewed. Look for collaborators suffering under the pressure. They can help you find and build a niche.

Capabilities

With all those in mind you can now turn your attention to building the capabilities you'll need to win in your chosen niche. Look across human, operational, financial, technical and asset dimensions to build only what you need, outsourcing the rest so you can stay focused and flexible.

(This framework is described in First-Time Leader. Request an executive summary.)

This article originally appeared on Forbes.com