07 May New Yorker Magazine: When David Beats Goliath
Posted at 08:47h in strategy 2 CommentsJoel Shapiro emailed me a link to an article that Malcolm Gladwell has written in this week’s New Yorker magazine, that takes the story of David versus Goliath and connects it to modern examples of how to change the game in your favour.
Here are two key concepts that come up in the article:
- If you have limited resources when compared to a much larger competitor then using a similar strategy to them in the marketplace will most likely lead to failure. The solution is to approach the market in a way that is unexpected. The best non-business example of this is the current problem of the Somali pirate attacks, IEDs in Iraq, and frankly terrorism overall. Small, poorly funded, unorganized, and badly armed bands of marauders have managed to cause significant damage by not attacking head-on, instead by attacking using stealth and their small size to their advantage.
- A full court press beats the wait and see approach the majority of the time. Slowing down or completely stopping the momentum of your competitor with your actions will cause they to focus on the wrong thing and doing that means moving away from their own strategy. The current example of this is the I’m a Mac commercials from Apple. Microsoft was forced by it’s much smaller competitor to abandon it’s advertising approach (which was actually also in response to Apple) and instead focus on selling off price differential, basically saying, “hey, well, at least we’re cheaper!”
I’m interested to hear some examples of business cases where these principles have shown to be valuable so let’s turn this monologue into a conversation. Comments?
thejasonyangPosted at 13:24h, 11 June
Great example! Apple seems to consistently play the part of “David”. Another example of this is in the battle for smartphone market share with market dominator Nokia. Not only has Apple already eaten away a huge chunk of this pie, it’s rate of growth in moving forward is astounding.
Another company of note, HTC, seems to have gained quite the foothold lately as well, converting itself from an Original Design Manufacturer to an independent developer of its own branded smartphone products. In just a few years this company went from almost unheard of, to launching Rogers new flagship Android phone. A big leap, and definitely another threat to Nokia.
Haha, I guess what this ends up pointing to is the fact that Nokia needs to start acting fast before a swarm of little Davids take it down.
mikedesjardinsPosted at 13:35h, 11 June
A very good example Jason. The cellphone industry has changed significantly as a result of players that weren’t even in consumers’ consciousness a few years ago. Clearly the barrier to entry in that space is much lower than Nokia ever imagined. It will be interesting to see what happens when Microsoft decides to add a cell radio to the ZuneHD.