I recently spoke at an entrepreneurial conference for high school students. My topic was how to recognize an opportunity in the marketplace to start a new business.

I asked nearly 100 students if they use the same toothpaste every day and if they will buy the same brand when they need to purchase more. More than 80 percent indicated that they are loyal to one brand and will continue their past buying behavior into the future.

This example defines a "certain market," in which buyers have already made a decision on what they will purchase. The costs to switch the buyer are high, and therefore the opportunities to enter this type of market are limited.

Contrast the above example with a market in which customers have not made a brand selection and are confused about the purchase decision. We might classify this market as "uncertain." Research indicates that uncertain markets are attractive to new businesses and often lead to significant success in the marketplace. The entrepreneur has the opportunity to communicate the advantages of the product or service being offered to a customer who is willing to listen.

Once you have identified uncertainty in the marketplace, you then need to position your offering into a unique niche or segment. This step will allow you to be different, to create your own identity.

In "The Book of Business Anecdotes," Peter Hay offers the following story: "When F.W. Woolworth opened his first store, a merchant on the same street tried to fight the new competition. He hung out a big sign: 'Doing business in this same spot for over fifty years.' The next day Woolworth also put out a sign. It read: 'Established a week ago: no old stock.' "

Woolworth understood the need to establish a niche.

The strategies of product differentiation and competitive advantage are then used to develop the unique attributes that you bring to this market niche. It is critical for the buyer to view your firm as a better alternative.

We all recognize that the voice over internet protocol (VoIP) technology is hot in the communications sector and that large, well-funded companies are battling for dominance in the marketplace. How could a small startup enter the market?

First, the market is filled with uncertain buyers who do not know if they should use VoIP or to whom they should turn for service. Second, if a niche could be found in which the large industry players are not focused and a company could differentiate itself and created a competitive advantage, then it might be advantageous to take the risk and enter the market.

A group of young entrepreneurs from Utah County has taken the leap into the industry. Recognizing that all of the above conditions existed, they formed a company and raised capital to enter the market. The team identified a group of small to mid-sized business owners in Mexico who needed the service but were uncertain about the buying decision.

In order to differentiate its offering, the company built a service and delivery strategy for business professionals that included a unique management reporting system and hardware to assist in making the installation process seamless. As a new lean competitor, the company is able to offer its service for a fraction of the price that the legacy carriers need to charge in order to cover their overhead.

This exciting young company has identified an uncertain market, picked a niche, developed a differentiated product and established a competitive advantage. Well-positioned businesses are attractive not only to investors, but also to customers who are looking for certainty in a confusing marketplace.