The topic of innovation seems to be all the rage these days, as both start-ups and established businesses strive to find groundbreaking new products and services to put their growth rate on the fast track. But the truth is that the majority of successful businesses weren't started by geniuses like Thomas Edison and his 1,093 patents. Think about a couple of recent examples: Facebook wasn't the first social networking site (Friendster might deserve that honor) just as Google was far from the first search engine (alas Magellan, Infoseek, and Snap).
The advantage that both Facebook and Google leveraged was that they were late-movers, says Navdeep Mundi, a professor of management at the Marshall School of Business at the University of Southern California.
"A first-mover advantage is the position held by a firm for being first in a market or first to use a particular strategy," says Mundi. "A late-mover advantage is the position earned by firms that are late in entering a market, usually following the first movers and innovators. Late movers and market challengers often imitate the technological advances of other firms or reduce risks by waiting until a new market is established."
In other words, Facebook and Google are examples of companies that allowed their predecessors to establish a market before swooping in with, say, improved technology and business models to take control. Employing a late-mover advantage is not unlike the technique of drafting used in auto, bike and horse racing where the pack initially allows a competitor to expend themselves by setting the pace. Then, as that competitor begins to tire, the pack closes in and leaves the early leader in the dust.
The point is that when you and your company set about finding the next great new idea, you might want to look at your competition for some inspiration. "While I love a new ideas as much as the next person, I also value following the leaders," says Lauri Flaquer, a business consultant with Saltar Solutions in St. Paul, Minn. "After all, why blaze your own trail when someone else has cleared a perfectly good one for you. Watch, listen and learn and you'll be able to avoid making the costly mistakes of your predecessors."
If you're not convinced yet, consider the following nine tips from business leaders and thinkers about why imitation can often be better than invention as a business strategy.
1. Refining is easier.
"There is a very steep learning curve in creating something," says Dr. Larina Kase, a business psychologist. "After that the energy required to maintain it plateaus. Skipping this initial influx of energy by imitating frees up resources to maximize and perfect. Innovation is about solving problems. When you base your business on an existing model you can focus on what works and what doesn't work for consumers (rather than focus on creating the business model). You can focus on consumers unmet needs and create an innovative product or service to meet those needs."
2. Benchmark your progress.
"Everyone needs a starting point, but picking a place to begin and setting your own deadlines is tough," says Marc Quadagno of the Raw Talent Group, which makes music-teaching software like Raw Talent Guitar. "Analyzing where others have succeeded is a great way to benchmark where you are currently and where you need to be. Plus, you won't feel as if your decisions are arbitrary. You have to know your work will provide you with rewards, and NOT being the first gives you insight to all the successes of another company, but more importantly, their failures."
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3. Spend your money better.
"Being the first to do something in a market sucks," says Carol Roth, a business advisor and author of The Entrepreneur Equation. "And you know why? Because you have to educate consumers and that is expensive. Educating consumers about a new product or service takes, effort, time and a boatload of cash. In fact, sometimes the better strategy is to be a second or third mover in a space–let someone else spend the Benjamins to educate the public. Then, you can figure out how to do it smarter, faster or better."
4. Learn from their mistakes.
"An innovation or a new idea is an untested, untried venture," says John White of BestEssayHelp. "Imitation helps 'fix the bugs' of the initial business idea. Research and case study can identify major problems and weaknesses of any business. Imitation helps avoid those mistakes and what's more important–upgrade and bring something new to the already existing product or service."
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5. Remain nimble.
"If a first mover has a strong market position, there's a good chance that they're so good at 'what they do' that they're too big and have so much momentum that they're not in a position to make quick changes and innovation," says Sean MacPhedran, general manager of two companies: Tomorrow Awards, an award show for advertising; and Giant Hydra, which provides crowdsourcing for ad agencies.
6. Research better.
"Consumer research is easier because people are familiar with the product or service," says John Paul Engel of Knowledge Capital Consulting. "It's impossible to do a focus group or user testing in the abstract. However, it's fairly easy to buy some of the first movers' products and sit down with customers and find out what they do and don't like about it."
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7. Make yours better.
"Customers like things that are the same but with small differences," says business consultant Lisa Jackson of Corporate Culture Pros. "We are creatures of habit, which is why 75 percent of the population buys products they are familiar with. That's why 'New and Improved' sells.
8. Learn marketing tips.
Observe the style and language of your existing competition, says Jovia Nierenberg of Experience in Software, creator of the project management software platform, Webplanner. "Read their promotional materials–their Twitter, blog, website, Facebook page, etc.," she says. "It's also wise to pay attention to the publications that reviewed, mentioned, or interviewed your competition. Chances are they would be receptive to hearing from you, too. This 'discovery' work has been done for you."
9. Get funded.
"It's much easier to get funding if an idea is already proven in the market," says Engel of Knowledge Capital Consulting. "After the initial success of MySpace, for example, investors were more willing to open their check books for companies like Facebook."
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