One Way to Outsmart the Competition
Santa Monica has no shortage of coffee shops. Most interestingly, it also has no shortage of independent coffee shops, likely right across the street or on the same block as a Starbucks or Coffee Bean. And they are very successful. Often because they specifically strive to represent what Starbucks is not – by utilizing unique localized décor, custom music mixes and focusing upon specialized coffees (capitalizing upon the trend for “craft” products – craft beers and craft cocktails) with proprietary single cup brewing techniques.
A recent posting by Jeremy Gutsche spoke about utilizing this type of conceptual development – divergent thinking or thinking the opposite – to identify opportunity. For example, rather than compete directly with Facebook in 2008, and most likely fail, potential competitors thought of NOT competing with Facebook and succeed by becoming what Facebook was not.
The results were groundbreaking:
- Facebook was known as a place to ARCHIVE PHOTOS,
- SnapChat became a $4 Billion company by giving users the ability to NOT ARCHIVE PHOTOS
- Facebook was known as a place to easily share EVERYDAY photos
- Instagram, became a $1 Billion acquisition target by giving people an opportunity to share CUSTOMIZED photos with special effects
As the recession engulfed America in 2008, I was focused on a different type of client – a large residential real estate builder – who was in a continual dogfight with his competition over the diminishing supply of money for new residential construction. No matter what this client tried, he became mired in bidding wars to secure clients through the lowest price of his perceived commoditized services.
We decided to utilize divergent thinking. My client’s business focused upon BUILDING NEW HOMES. We researched the market, and realized there was a big opportunity in expanding into MAINTAINING OLD HOMES, as well as maintaining and servicing the new homes he just sold.
My client already had extensive expertise in virtually all areas of a home’s construction from plumbing to electricity to appliances. The client began a program of selling monthly maintenance and service contracts to existing, as well as new, customers covering preventive and repair services for homeowners. Over time, the results were very strong. The new service succeeded as:
- A significant contributor to overall company revenues
- A highly successful new lead generator for the new home construction business
- A source for higher margins on new home construction bids because the company was now a well-liked and frequently utilized entity by existing service customers and their referrals.
Divergent thinking can produce breakthrough results in the right circumstances.
Have you put it to work for your company?