Rule #24 – Be #1 in the World.

Run – don’t walk – to the bookstore and get a copy of Seth Godin’s newest book, “The Dip.”  Godin, a master marketer and author has laid out a succint, 75 page offering about how quiting is a great trait.  His point is to quit early in a project that isn’t up to snuff.  Aside from the motivational, “life is too short to work on bad projects or with bad people”, Godin artfully lays out that every project, product, or idea faces a “dip” when it seems like quitting is the best option.  His view is to quit before the dip or suck it up and work through the dip until you realize the success you’ve been after.  Working through the dip insulates you from competition (that is likely to quit) and helps establish you as a player in your market.  Great read from start to finish.

Perhaps the best part is where Godin lays out that it is a waste of time, energy, money, and other resources to work on a project where you aren’t trying to be “the best in the world.”  Looking back on it, I’ve been a part of a handful of failed ventures precisely because we were trying to get a little sliver of a large pie without being disruptive and getting the competition’s attention.  Starting off with the mindset that you’re company is going to be “good enough” instead of “great” is a terrible thing.

What’s interesting is how Godin encourages the reader to define a clear “world” market where being the best is attainable.  Because of the internet, it’s near impossible to be a worldwide player at anything.  In tech, if your idea is any good then the chance is good that someone at Google, Microsoft, or Yahoo! is already working on it as well and has a lot more ammo then you.  In products, everyone from Apple to Wal Mart could be your undoing in a blink of an eye because of the scale they possess.

Instead, focus on a specific niche where you can really excel.  Then, dive headlong in to that market.  For example, if you’re developing a photo-hosting program on the internet, maybe you should focus on catering to moms who want to post photos of junior’s soccer game for grandparents to view.  If you’re building boats, maybe focus on a certain price-point for people who like to fish but want a boat they can ski behind as well.  If you’re selling a liquid compound that helps people keep their hands dry when gripping something, focus on weightllifters or cyclists or construction workers.  And once you’ve become a leader in that market, add another one.  Regardless, find a market (“world”) where you have a decent chance of becoming the top player.  As Jack Welch famously said and acted on while running GE, it is a waste of time and resources to focus on any industry where GE could not be #1 or #2 in the market.  That worked out reasonably well for him and for the company.  

My current venture – distributing board-level electronic material is rife with competition around the world with more products and more “feet on the street” selling those products then we could ever hope for.  As a result, we’re focusing on serving a specific customer type (engineers and new product development teams) in a very specific area (central Texas).  Yes, we’ll take whatever other business trickles.  But instead cold-calling all over the country hoping to find a company somewhere that could benefit from working with a company like us but isn’t currently working with a company like us, we’re working hard to be the default provider of our products and services for folks in specific positions at specific companies in a specific area.  And when we one day achieve our goal of being the preferred provider of our services for a specific segment in a specific area, we’ll modify our “world” by expanding one piece of our market segment.

Anyway, if you are starting a company you are no doubt dreaming of IPOs and big buyouts and huge pageviews.  But the reality is that you’re better off zeroing in on one type of customer in one type of market and trying to win every inch of it as opposed to simply casting a wide net and seeing what you catch.

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