Transportation, newspapers, and video stores- these are industries which have seen massive changes within the past few years. Companies which were once giants in these fields have either gone bankrupt or seen a massive loss in their profits. Yet demand for navigation, information, and entertainment hasn’t disappeared. People will always need directions to a specific destination or want to keep up with current political events. Since this is the case, why are the original industry figureheads suffering so much? The answer is simple: other companies are doing the same thing better, cheaper, and faster by utilizing a different business model. Apps such as Uber and Lyft offer a more affordable and convenient alternative to taxicabs, news can be found for free on a multitude of websites as well as on social media, and the prevalence of digital media has rendered physical media near obsolete. Don’t be caught off guard, prepare yourself with the knowledge you need in order to navigate a rapidly shifting market.
What’s more, sometimes it is not enough to simply identify the shift in power. By the time a trend has appeared and is validated, chances are that other competitors are going to be knocking at the door asking for their piece of the pie soon enough. There are two primary ways of making sure that your business stands out from others and captures a growing market.
Commit to Your Decisions
The first is to simply beat out your would be competitors in whatever avenue you would pursue. New trends, even if validated, generally aren’t fully adopted for quite some time. While there will be many people who will begin to explore and probe, very few will fully commit. By striking first and diverting more attention, resources, and cash into the venture than your competitors, you have the opportunity of providing a better offering.
This option requires a large amount of confidence; after all, the idea is to commit more than your opponents. In poker, it’s the equivalent of going all-in. Very few will want to call that bet, locking themselves out of the opportunity. The only way other firms will be able to compete with your offering is to divert at least as many resources on their own project as you have.
If you intend to achieve optimal results, your business’ livelihood must be tied to your new model. The most effective way to motivate yourself and others is through necessity. Without an alternative, the price of failure becomes too high to accept. When there is no “safety net,” people tend to take matters much more seriously.
A company which committed to adapting would be the videogame development studio, Valve. Like many PC gaming companies, Valve started out by creating games to be sold in the retail market. As time went on and broadband internet connections got better, digital download platforms started to spring up. Wanting to be ahead of this new growing trend, they came up with an idea for their own platform which would allow gamers to purchase and download videogames without ever needing to leave their homes. This could be seen as a precursor to what would become known as the modern “app store.” While they continued to release games in the retail sphere, Valve directed the majority of their resources towards the establishment of their new platform which they dubbed, “Steam.”
As retail sales of PC games got worse and development companies began to experience a loss in profits, Valve stayed strong and continued to expand its fledgling new platform instead of doubling down on retail sales in the console sphere like others were doing. In fact, Valve would eventually begin to cease production of retail units entirely, cutting off their original largest source of income. The result? According to Forbes, 51% of digital game sales now come from Steam, with the next highest competitor being Amazon at a mere 11%. While other companies experimented, Valve stayed dedicated and ended up ahead of their competitors.
Keep Up To Date With Your Surroundings
Equally risky is to look ahead into the realm of unvalidated ideas. There are many ideas out there which have the chance of being the “next big thing,” but the risk of them failing is usually high. With a keen eye and a firm understanding of the nature of your current market it is possible to identify future threats far ahead of time.
If you own a hardware manufacturing company which produces DVD-players, then smell-o-vision probably won’t be very disruptive to your company’s bottom line, while online streaming has the potential to kill off your business. Sony was able to get around this conundrum by focusing on gaming consoles. By including the ability to play DVDs as well as Blu-Rays on gaming devices, they were able to then sell an all around media device which combined and appealed to multiple markets. This decision predates the rise and ubiquity of streaming as we know it today so that when the time came, Sony was safe.
When evaluating concepts and ideas on the horizon, the most likely outcomes are usually the least exciting. In order for something to go from simply being an idea to existing in reality, steps must be made. While there is a demand for flying cars and jetpacks, these products would require a production cost way too high to become profitable. The recent “hoverboard” scooters on the otherhand? Those fulfill a similar need while also being relatively cheap to manufacture and easily distributed.
Change is coming. Change cannot be stopped. No matter what era or industry, things will change. By fully committing to innovation and consistently monitoring the competitive landscape, you’ll be able to stay ahead of the curve and ensure your business thrives for a long while to come. Complacency and stubbornness are the enemies of innovation and constant innovation is what brings true long term success.
Keep an eye out for an upcoming series of case studies where we showcase custom web-based applications we have created to solve some of our client’s challenges. These examples will provide even more helpful ideas as to how technology can be used to evolve your business.