Tag: niche

Harnessing Imbalances

The women of Camp Hansen were not attractive, but they were courted as if they were supermodels.  I spent a year in Hansen as part of my service in the Marines.  There were 6,000 or so Marines and maybe ten of them were female.  

In the news recently: airlines are offering pilots three times their normal pay for taking on extra shifts.

When I started working in web development in 2007, businesses still asked each other for web design referrals.  A couple of years later, suddenly everyone was looking for mobile developers.

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Hydra Positioning Strategy

Years ago, I shared an Uber with another agency president from the airport to a business conference. It was a random interaction, just a coincidence that we were on the same flight to the same place.

A year or two after that, I ran across a sales executive from his team at an evening mixer for the local biotech industry. I was there doing research on positioning for my agency and the sales exec was there looking for clients. This was odd because I didn’t realize the agency specialized in biotech and also because most agencies don’t have salespeople out at evening mixers.

I joined the Rotary Club in Portland last month and was, again, surprised to discover the agency president as a member of their leadership board.

Yesterday, I was doing research on PPC competitors and did a quick lookup on the agency and found that they advertised heavily in the Shopify market.

This morning I looked at their website and found no mention of biotech or Shopify.

What is going on with their customer acquisition strategy?

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Why There’s Less Profit in Specializing

There’s a common belief among entrepreneurs that serving a niche is better than being a generalist. Lots of smart people recommend this specialist approach.

Which is why I was surprised to see several research studies on the agency industry that showed that generalist agencies were more profitable than specialist ones.

Are all those smart people wrong? Not exactly. But there is nuance to specialization that few people understand or explain.

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Overcoming a Murderers’ Row

I’ve been a mixed martial arts (MMA) fan since I was a teenager. One of the beliefs that gets thrown around among fans is that, “to be the champion, you have to beat the champion.” This means that the challenger for the belt must not only win against the champion, but must do so convincingly. Their victory must be so obvious that none can dispute it. If they don’t accomplish this and the champion wins a decision before the judges, it’s the challenger’s own fault and they have nothing to complain about.

Markets function the same way. Consumers are risk averse and will congregate to whoever is the perceived market leader. For many markets, the size and age of the market has evolved it into what fight fans would call a, “murderers’ row.” In other words, an ecosystem with serious competition.

For your business to grow, you have to figure out how to tap into some form of energy to sustain that expansion. If that energy is going to come through new customers, out competing some form of murderers’ row is a reality you’ll likely face.

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Using Horror Vacui to Innovate

If you walk through a forest, you’ll see a limited number of species of trees.  Depending on where you are, this will probably be smaller than you can count on your hands.  Why aren’t there more?

There are only so many resources in a patch of earth that a tree can use to grow.  Each of the species uses different requirements and advantages to compete for and use the available real estate in a forest.  Where the edge of one species advantages end another species begins.  For example, one needs a lot of sunlight and won’t grow in the shadow of a hill where another grows best with shade.  

For each of these categories of context, a species survives and reproduces the best.  This results in them dominating that spectrum in the forest.  They fit best there.

The market is the same way.  The resources and energy available in the market pull solutions into existence to address the available contexts.  Horror vacui or “nature abhors a vacuum,” is how Aristotle described this effect.

If there is a market, there will be a limited number of kinds of solutions in it with dominant market leaders.

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