Council Post: Why It’s Better Not To Be The First Brand In The Industry

You have an idea for a business. Then you start thinking about it, and you realize that somebody has already done it. Maybe even a lot of companies are doing what you want to do.

So, you abandon your plan and try to think of some other business concept that nobody has done.

Not a good idea. Go back to your original idea.

For the past several years I have served as the CEO of a national therapeutic spa franchise that specializes in massage, facials and waxing services. When our brand opened its doors in 2008, do you think we were the first therapeutic spa franchise? Definitely not! In fact, the first day spa is credited to Elizabeth Arden, the famed cosmetics businesswoman, who began one way back in 1910.

Our brand would not be what it is today if we had thought, “Well, it’s been done before.” Most businesses wouldn’t. If all entrepreneurs thought that way, there would be one pizza place in the country, one airline, one department store and so on.

If you’re thinking of starting a brand that has more than a little competition, here’s why I think you should forge ahead. In fact, I’d argue that it’s better not to be the first brand in the industry.

Learn From Your Competitors’ Mistakes

We all respect the leaders in an industry, but the fact is, they aren’t perfect. If being the first in an industry meant being the best, there wouldn’t be only one Blockbuster Video left on the planet. Granted, that’s an often-cited example, but it’s a useful one to consider.

Blockbuster was terrific, but Netflix capitalized on the fact that not everybody wanted to drive out to a store to rent a video.

If you start a business in a crowded field, you have the benefit of looking at not just what other competitors are doing right, but also what they’re doing wrong. Then you can work on your business model so it’s even better.

Turn A Competitor’s Weakness Into Your Strength

If you’ve found a better way to offer a product or service, you need to make that clear in your marketing. If it’s obvious your competitors have weaknesses, you can and should shout it from the rooftops.

That is, after all, what now separates you from the rest of the pack and makes it clear why people should come to you. If you offer a product or service with features that people value, they need to know so they can understand why they should pick your brand over the others that have been around longer.

You Have A More Educated Customer Base

At the beginning of any industry, the customer may not know what they want. Your customer is just grateful to have a need met. By the time there are competitors out there, your customers are smarter. That can benefit you because you don’t have to educate the customer.

If you’re offering premium products or services, you don’t have to spend as much time explaining why your products or services are so good. Customers will know. In fact, many of them, the discerning members of the public who are willing to pay more for a better brand, will demand it.

Think about the first coffeehouses. People were probably thrilled to get a hot cup of joe. They didn’t care that the choices were black or cream. Then Starbucks came around and had to educate the public and explain why spending two or three times the amount for coffee was a good idea.

Now, if you want to open a coffeehouse and do something similar, you don’t need to spend time explaining why premium coffee costs more. People get it.

People Like New And Exciting Things

You’re starting a new business, and nobody’s heard of you? That’s actually an advantage, in a way. Yes, it helps to have big name-brand recognition. That’s why people buy into a franchise. They recognize that it can be extremely challenging to get your name out there and build a business completely from scratch.

At the same time, if you’ve been around forever, the public has a way of taking you for granted. No offense meant to the company, but when was the last time a friend or family member of yours posted on social media how truly excited they were to go to a McDonald’s? I’m guessing it’s been a while. Everybody has been there. McDonald’s is a lot of things, but it is definitely not new.

Your new business has that advantage, as long as you are actually offering something amazing.

As for Elizabeth Arden’s day spa, incidentally, it’s still around, sort of. It eventually became a small chain of day spas and, several years after a private equity firm took it over, its original name was changed last year.

My larger point is that you can’t worry about what business owners have done before you came along. You only need to focus on you. It doesn’t matter if you were the first to come up with a business concept or the last. What matters is that you’re always striving to be the best.