MARKETING ACTUARY: BAD BUSINESS LESSONS FROM THE OLYMPICS

July 31, 2012

BAD BUSINESS LESSONS FROM THE OLYMPICS

The Olympic games show that victory comes from years of expensive training and a miniscule margin. That’s hardly worth emulating in business.

In real life, training is important --- the "10,000 hour rule" --- but competing at the same time at the same event under the same rules? That creates one winner (unless you think silver and bronze count) and lots of losers (if you include those who weren’t quite good enough to qualify).

In a sense, there is no competition because the creativity has been eliminated and the contestants perform so similarly.

Other Ways

In business, you don't need to be the fastest or strongest. You need to be different and be seen as different.

Big Fish

A better approach is to dominate an untapped niche. Big fish, small pond.

For example, if Motorola tried to out-iPhone the iPhone, they'd lose. Instead, they created the Droid, a clear alternative (see Wired). Because of the keyboard and business focus, the Droid also attracted former Blackberry users like me (see the perfect smartphone).

Different Model

Dell Voice launched in Canada recently. You get a phone number and unlimited countrywide calling using your data plan. Google Voice is similar but still not available here. Both are free. Skype is similar but more expensive since there's a charge for getting a phone number (still not available in Canada) and calling phones.

Phone providers need to make money from their subscribers. Dell and Google don't.

Then What?

Olympic competitions end. Then what? Another four years of practice or time for retirement? Winners may get sponsorships.

Maybe you set a record. How long will it stand? The world will remember thanks to web searches. That doesn't mean the world will care. We have many distractions but no more attention to pay.

In business, past accomplishments are of limited historical interest. What have you done recently? That's what matters. Where's the proof? Who pays attention? Who cares? Say you invented the first fax machine. That won't get you a free coffee today.

Tainted

The Olympic games have perennial drug scandals. This year, a $30 million lab near Olympic Park is doing the testing. As a result, if athletes “… are cheating they are likely to be caught” (CNN). How comforting.

Is the winner the best or the best at not getting caught? The honest ones face skepticism, which diminishes the value of winning.

In business, you risk of getting tainted too but have techniques to build trust.

Better Than Faster

Olympic records can and are broken. Fastest is temporary. First is forever. We remember firsts like

the four minute mile (Roger Banister)
the ascent of Mount Everest (Edmund Hillary and Tenzing Norgay)
the telephone (Alexander Graham Bell)

Even firsts can lose significance. These days, who cares who invented modern "essentials" like the tablet computer (not Apple), the smartphone (not Apple) or the search engine (not Google)? We care more about our current preference.

Constraints

Our bodies have physical limits. Athletes can improve but by decreasing amounts. Yet vast resources continue getting invested for those marginal returns.

In contrast, our ability to innovate is unlimited. We are allowed to use tools and get help. There are no drug tests either.

Another Way

Instead of getting diverted by bigger, faster or shinier, you can work on continual incremental improvements that show in your digital tapestry. Slow and steady lacks sizzle but life is a marathon.

MARKETING ACTUARY