I’m a big fan of disruptive businesses; particularly ones that launch in long-standing industries with well-entrenched players. Contrary to popular belief, they can provide the best opportunities for entrepreneurs and investors who seek to start the next big thing.
Often times the bigger companies can’t adapt quickly enough to changing consumer demands and market trends, and leave behind frustrated customers and prospects that will jump at the chance to try a new provider if such an entity arises. It’s in this vein that I launched ValoreBooks eight years ago. At the time, I was a college student tired of paying the high prices at the campus bookstore for my textbooks only to find out four months later that I couldn’t sell them back because the school no longer felt that they were of value. I believed otherwise, and started the company. Today, we’re a rapidly growing market place that offers individuals a chance to purchase a wide array of cheep textbooks from more than 10,000 independent booksellers across the United States. In short, we shook things up.
There are several other examples of this in many other markets. Netflix comes immediately to mind, with the widely-popular online subscription-based movie rental service now slowly killing the Blockbusters and Hollywood Videos of the world. Going back in history, one could also argue that the automobile and railroads brought down the Pony Express and well-regarded stagecoach mail services. No matter the era, innovation will always bring forth new opportunities and new players that will find ways to capitalize on them.
However, there are infinitely more scenarios of when an upstart failed in their attempts to make a dent within an established market, falling by the wayside in rapid fashion without anyone really noticing. It’s a common tale for sure, and indicative of the care entrepreneurs need to take in figuring out if their business will make a difference or just a lot of noise. So before launching the “next great thing,” I’d recommend people consider the following to ensure their value proposition is truly that:
How rebellious are you? Is your offering so different that it’s noticed by the casual observer? That will most likely mean that you significantly alter two of the four “Marketing P’s.” For instance, at ValoreBooks, we not only offer college textbooks at half the price of the university bookstores, but we do so through an online marketplace that allows students to purchase their supplies without standing in long, arduous lines.
Are you solving a true pain point? Is your approach not only considerably dissimilar from your rivals, but in fact solving a real issue with customers? A “nice of have” offering is not enough; the solutions you provide must be so great that it will be enough to get people to change their buying habits.
Can your rivals quickly adapt? What are the barriers to entry for established players to do what you do? If rivals can easily copy your approach, you may want to consider doing more to gain a long-term edge.
How committed are you? If you’re a “David” going after “Goliath,” you’d better be ready for a fight, and go at it with full force. That doesn’t mean you must take uncalculated risks, but be sure that your execution is done with the full conviction and with as much resources as you need and have available to make it happen. Anything less could give the entrenched players the opening they need to prevent your success.
The bottom line is this. Entrepreneurs who are passionate about making a difference in a market – any market – should do so, but only if their offering is truly different and valuable to the customers. Don’t look back after going all in. Best case, you’ll be a big success. Worst case, you’ll go down swinging, but not before making a positive impact in the process; and letting that be your professional legacy.