Comment by raganwald | Hacker News Reader

Comment by raganwald | Hacker News Reader

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In "Marketing Warfare," Al Reis and Jack Trout give a rule of thumb: Never build your strategy around an opponent's weakness. Build it around their strength. Why? because weaknesses can be fixed. Strengths cannot be fixed without undermining an opponent's own strategy.

From this, I get that there are two kinds of problems with a product or service: A weakness, which is something bad that is orthogonal to a product's value proposition, and a drawback, which is an integral part of the value proposition. An example of an Apple drawback would have been its one button mouse for many years: During the period when many Mac buyers were first-time computer users, the single button was part of the simplicity of the interface, but it also was annoying to those who had more experience and wanted more power at their fingertips.

I remember this when thinking about tethering my iPad. This is a weakness, not a drawback. It can certainly be fixed without undermining the iPad's value proposition. If somebody starts selling a lot of tablets that sync to the cloud, Apple can release a firmware or iOS update that syncs to the cloud and boom, no more weakness.

It's annoying but it isn't deeply tied to the iPad's value proposition. So I predict that if and when Apple thinks it is more of a hinderance than a help, it will be changed, and the change will be fairly painless.

This seems to be another way of describing disruption (and I like it):

Companies serve their customers. They improve their product along a dimension that their customers want. Equivalent to your "weakness" - as soon as their customers care about this, they work hard to fix it.

If you create an alternative product for those very same customers (and for the very same use) that's not as good in that dimension, they won't buy it. If it's better on that dimension (a sustaining innovation), the incumbents will work hard to beat it - and historically, they usually will, as they have all kinds of advantages over you.

But if you build for different customers, who currently have nothing, they will be delighted, and the incumbent won't care because you don't threaten their customers. Now, usually such a product will have other benefits that the competitor's product lacks - at the very least, a cheaper price, but maybe also convenience, flexibility, customizability, simplicity etc. This benefit is usually a result of a tradeoff against the above dimension - a "drawback".

Over time, you naturally will improve your product, and (perhaps) it will approach being good enough to threaten that competitor. But even as they see you approach, they really can't fight you, because it would require they let down their customers. And, what's even worse, at this new way of doing things, you are now the incumbent, with all the experience with engineering, customer acquisition and business model etc, and they are the entrant.

But I think you add a new idea to disruption, that the "drawback" is incompatible with the value proposition, as opposed to being orthogonal. Different business models are often like that; also many engineering tradeoffs. It's exacerbated by when you improve at something, you often specialize in it; and specialization in one thing implies de-specialization in something else.

Note that such incompatibilities are not restricted to engineering issues: if Apple somehow became dependent on tethering, or on iPad users requiring an Apple desktop, as part of their business model, it would then become a "drawback", that you could attack on.

Nice observation, I never tied Reis & Trout's explanation to disruption quite like that. They were describing a "Flanking Attack" which really fits with what you're describing quite well. And yes, the incompatibility is the key.

Going back to The Innovator's Dilemma, this explains why companies become trapped by their customers: Their existing customers hate anything that addresses the drawback because it is incompatible with the value proposition that appeals to them.

Although Microsoft won the battle by burying Netscape, they seem to have lost the Internet war, in large part because the Internet is incompatible with the value proposition of operating systems and desktop office productivity software. For example, the Internet does away with installing software binaries. Which is a drawback of desktop software and operating systems. But that is incompatible with the value proposition that an IT department gets to control what runs on an office computer.

The Microsoft example is a good one because Apple inadvertently stumbled on the solution. At first, with the iPhone, Apple embraced the idea of the device simply being a consumer of the web without any dedicated apps[1]. That is effectively Microsoft's nightmare. However, the app store quite effectively mitigated the advantages of web and they've had an explosive growth of native apps despite the existence of a strong browser.

Microsoft lost the Internet war, not necessarily because the Internet is incompatible with desktop but because they never actually competed. Instead they tried to smother it. Honestly though, before the app store, I'm not sure anyone knew how one could compete with the web.

[1] Assuming that wasn't the strategy all along.

That's a good observation. I think of cables as an anti-feature. ( as defined by Benjamin Mako-Hill ).

In that, the devices are perfectly capable of syncing and tethering wirelessly, but Apple hasn't enabled that functionality yet. They are going to add that at some point for an extra 9.99$ and going to call it AirTether. Brand new feature of iPad3. You pay a premium for getting rid of cables.

The number of new iOS features you had to pay for is literally crushed by the number of those you did not have to. Yet this "Apple are a greedy bunch making you shell out $$$ for every single new feature" is incredibly entrenched. Was it historically even ever true?

>> Apple are a greedy bunch

Compare the price of Mac desktop or laptop to a Dell/HP/Newegg PC with the same hardware and Windows. Or just check the profits Apple is reporting. They definitely have way higher margins than the other mega-corps, selling hardware/gadjets.

Reducing the value of a technical object to the sum of its components is ridiculous. Compare the internal design of a MacBook Pro or an iPhone to their counterpart (Hint: take a look at ifixit).

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