The world is full of fast followers. Every new business immediately spawns copycats, riffers, and discounters; cheap knock-offs and traditional players trying to use their brands and size to barge into new markets. In many cases, when you invent and establish a new product, service, sector or approach, you actually make it easier for the guys running right behind you to succeed. Why?
So what’s a hard-working CEO to do?
Simple: You need to keep raising the bar on yourself, and your business, before your competitors do it for you. The acid test is, “What’s the best you can possibly be?” The answer is, “Better, for the moment, than anyone else who’s trying to do the same thing.
Of course, just because no one else has done something doesn’t mean you shouldn’t be aiming for it – you can’t let other people’s limitations hold you back. Entrepreneurship means committing to a life of constant awareness (okay, paranoia), continuous change and extreme flexibility, as well as the willingness to eat and to abandon your “offspring” before they run out of steam. If you can’t do it, someone else will do it for you.
A good example of a great company falling asleep at the switch is Nike. Nike owned the athlete for years. They had the coolest shoes, the coolest endorsements, the best technology and the coolest television ads. When the Web came along, they put up a pretty robust site to show off their ads and their products. Then, having fallen in love with their own videos, they sat on their laurels.
It didn’t take long for competitors to figure out that the real athletes weren’t in it for the ads or the glory. They launched web sites that served the real needs of athletes – providing exercise programs, race training regimens, fitness tracking, online connections with like-minded people, athlete and team meet-ups, etc.
In pretty short order, the real athletes--and plenty of weekend warriors-- totally bailed on the Nike sites. The other sites were far more connected to their interests and represented far better uses of their scarce time. Nike opened the door for small, quick competitors to jump in with simple, straightforward tools and applications that let them to eat Nike’s lunch.
How badly did this hurt Nike? We can track the popularity of Nike’s brand online by tracking their Facebook likes. (Yes, there are some questions about fake likes, but since I’m interested in comparative data, we don’t have to worry about those right now.) True, this is only one way of keeping score, but it’s one of the best we have right now. So here’s the “likes” math:
Baseline Players October, 2010 September, 2012
Coke 15 million 50 million
Starbucks 16 million 32 million
Converse 7.4 million 33 million
Adidas 4.8 million 15.7 million
Nike 2.5 million 10.5 million
When you look at these numbers, it’s clear that Nike really isn’t in the same league as the big dogs.
Raising the bar means that you need to constantly make yourself obsolete and regularly cannibalize your products and services. The rate of change is autocatalytic – each change creates the next at a faster rate, and leads to disruption and radical obsolescence. It’s all driven by virality and almost perfect cross-market intelligence. If you want to stay in the game, keep raising the bar.
Remember: No one cares who made the first version of something. They care about who makes the best version.