Small companies taking on big rivals. Plus, the art of the pivot, Hollywood smiles on Vita Coco, and the rest of the day's news.
Each day, Inc.'s reporters scour the Web for the most important and interesting news to entrepreneurs. Here's what we found today.
Throwing punches at the establishment. When there's an extremely dominant force in your market or industry, is it worth putting up a fight? Fortunelooks at three companies that aim to upstage their rivals by giving customers the things they really want. For baby-bottle-maker BornFree, selling BPA-free bottles allowed it to gain on Gerber a bit by pleasing eco-friendly moms, and it's stayed edgy by gaining celeb mom endorsements. The piece also examines how a third-generation Vermont sock company is taking on Timberland's SmartWool and how a Cambridge, Massachusetts-based SimpliSafe is hoping to challenge ADT as a home security-system standard, by bringing lower price, convenience, and wireless technology to an alarm system.
J.P. Morgan fund to stake Twitter? Thanks to a new "digital growth fund" of $1.22 billion, financial services firm J.P. Morgan Chase & Co. may soon be striking a deal with Twitter. According to The Wall Street Journal, J.P. Morgan is looking to buy a minority stake in Twitter, which would reportedly value the microblogging platform at $4.5 billion. Twitter, which has more than 200 million registered users, has already more than quadrupled in value over the past year. Despite continuing discussions between the companies, there is no guarantee of a deal yet. While J.P. Morgan has already purchased a large number of Twitter's shares on exchanges for private-company stock, it's also not clear whether the fund will directly invest with Twitter, or opt to buy current investors' stakes instead.
Drop one idea, succeed with another. Most entrepreneurs are pretty familiar with failure. But great entrepreneurs, the ones who build lasting companies, understand the art of the pivot; that is, a shift in strategy that turns a fledgling start-up into a well-oiled business. Caroline O'Connor and Perry Klebahn, professors at Stanford's design school, offer their tips for a successful start-up pivot in a blog post today in the Harvard Business Review. First, they say, keep an "idea compost pile," which is pretty much what it sounds like—a repository for all of your ideas to save for a later date. Then, turn your focus on your customers, and not just statistics about them. "You need to know them well enough to understand what's important to them, what they care about, and how your product fits into their world," they note. Inc.com blogger Marla Tabaka has her own view on relating customers in a blog post today, which she calls empathy marketing—meaning, "establish an emotional connection with the brand and embed the message in the mind of the consumer."
Hollywood cockoo for coconut water? If you didn't already know, it's official: Coconut water is the new health drink craze. At least that's what Hollywood dollars say. Last year a group including Matthew McConaughey, Demi Moore, and Madonna put $10 million into the company Vita Coco. This year, the same group is tossing in another $14 million, the New York Post reports.
Even Oprah struggles. Yes, she looked glowing while giving out an Oscar last night. But it's been two months since the debut of Oprah's television network, OWN, and all is not looking bright. Despite expectations of great ratings and increased viewers, OWN is only doing slightly better than the channel it replaced, Discovery Health. The New York Times reports that the channel is only capturing 45,000 of its demographic, women ages 25-54, out of the 135,000 people watching OWN at any given month. Nevertheless, Christina Norman, executive director of OWN, says it will take time for the channel to attract as many viewers as they expect, which is about 50 million to 60 million viewers per month. Discovery has faith and has agreed to invest an additional $50 million into OWN, on top of the $189 million its already contributed to the channel. Norman anticipates viewership to grow as soon as The Oprah Winfrey Show ends in September.
Is it time to ditch that website? We'd argue no, but Rockville Central, a local news site based out of Rockville, Maryland, has done the drastic. It's decided to ditch its dedicated website in lieu of a Facebook page, beginning March 1. Although this was not a profit-motivated decision, The New York Observer points out that it could potentially become a growing trend, a la the hyperlocal news site Neighborhoodr being at home on Tumblr. Unlike Tumblr, however, Facebook does not allow individual sites or outside users to independently run ads on its pages. If this model changes, it may potentially alter the platform—and the means—by which we receive our news online. A more extensive case study on the issue can be found at the Harvard University Neiman Journalism Lab today.