Differentiate Or Perish It's Easier To Compete As A Monopoly In A Niche

The Internet gave buyers more solutions, and more information (both ‘signals’ and ‘noise’) about those solutions. The ‘Research’ and ‘Consideration’ stages of the Buyer’s Journey are driven entirely by buyers.

There are a few bits of advice we cannot overstate: having a niche, or Unique Sales Proposition, that effectively makes you a monopoly, is one such bit of advice.

If you’re doing what everybody else is, and don’t think you need a specialization because you’re that much better, guess what? Being that much better is a kind of niche. 

In any case, you want a monopoly. You want to be the only company that offers what you do. 

What Forms Does A ‘Niche’ Come In?

  • Being ‘the only’ product or service provider, in any significant, sense.
  • Being first to market, whether that market is known 
  • ‘First In, Best Dressed’. 
  • Only provider in a region. 

Price and even design are not substantial differentiators, to our thinking. They’re not different enough to make you a monopoly. Too often, companies want to go to where the action is, to do what seems to be working. But that’s where the competition is. 

Hollywood films can copy what worked before, but which is gone now. In business, with companies having lifespans that last for years, undifferentiated entrants will be forced to split wins with companies already there, at considerable cost, swimming ‘upstream’ to win-over consumers already loyal to other companies. Even with a large war chest, it’s almost impossible to make this profitable.

Won’t I Limit My Demographic By Being Different?

Yes, but in all likelihood, your initial estimate of your market was greedy and too big, in the first place. Would you rather have 30% of nothing (a market you failed to capture), or 100% of the 5% the market that wants what you’re offering. 

Think of it like this: you want to open a fast food joint. There are three burger joints in town already, and they do well. If you matched their quality and price exactly, you should not expect 1/3 of the business. They’re established and have recognition and some loyalty. 

Now, what happens if people like their burgers more? You’re done. 

On the other hand, if you create a shop with no competition – selling food or something else – you’ve at least got a monopoly in that footprint.

The Internet is trickier: at least for most products, vendors from outside your region can ship anywhere, and therefore differentiating can be difficult.