(This article is the second in the series of my articles on startups. Please visit my previous piece, Bad Branding…, published on LinkedIn).
The moment we think about successful startups, our minds start breathing in billions. Names like Space X, Airbnb and Uber whiz past the thought dimension. Young and dynamic CEOs such as Travis Kalanick (Uber) and Evan Spiegel (Snap Chat) have already inspired thousands of entrepreneurs to start up on their own. And we can’t thank them enough for that!
But if we were to look at it honestly, don’t these stories of huge success throw a monkey wrench at pettier looking drawing boards? The truth is, not all of us need to have that supremely disruptive idea. And new startups can start with just an ordinary idea and identify a small gap in existing processes or sometimes they can be as ordinary as existing businesses.
Unfortunately, a small business idea is often weighed against the “million dollar startup” fantasy. The comparison is not just unfair, but also easily overwhelming. And before you know it, so many young people drop the idea of a new business.
The “extraordinary” chase
At this point, it is important to realize that most new startups are bamboozled by the glitz and glam of the extraordinary. After all, who doesn’t want to be described by phrases like “disrupter of business” and “pioneer of new thought”?
This hunt for the extraordinary, swiftly translates into a wild goose chase. And seemingly big ideas crash big time.
In my previous article, the story was written from the perspective of the acquiring companies, and here, we will flip that story and view things from the perspective of the acquired, to prove that Ordinary is indeed Good Enough!!
It was created as a status indicator app for the contacts. When Apple rolled out the push notifications feature in 2009, WhatsApp founder Jan Koum, sensed an opportunity and added an instant messaging feature in that app. Despite all phones having built-in messaging apps, WhatsApp was successful – the reason being the small gap between WhatsApp and the standard SMS service offered by the phone companies! The rest was history. The above link has a small pictographic story about Koum.
The story of Whole Foods is very ordinary, excepting the fact that the foods they sell are organic! That alone made a humongous difference and paved a way for the brand to be acquired by Amazon. The above hyperlink shares an interesting story about Whole Foods.
Jet.com (read an inspiring story on this link)
Jet.com is just another e-commerce company, but it tweaked the e-commerce model a little bit to compete with Amazon with its “SmartCart” – a proprietary algorithm that identifies, and financially incentivizes buyers to purchase more for less. Additional items that pack/ship with items that have already been selected, also debuted. Price comparisons showed Whole Foods products are 9% cheaper than Amazon and 6% cheaper than Walmart.com. Also, by probably openly challenging Amazon, Jet.com may have created an interest in Wal-Mart. Remember Walmart was struggling at 3% market share versus Amazon’s 31%, before acquiring Jet.com. This again created history.
The above stories clearly indicate that your ordinary idea may swell into a big startup, provided it is presented to the audiences properly.
What ordinary startups do to become extraordinary!
When you have identified the area/domain of your startup, define your product features, goals and the exit strategy. If you feel that your idea is ordinary, don’t worry! Do the following:
- Carefully study your top competitor and their competitors and their inabilities. In the case of Jet.com, Amazon is way ahead in the game of e-commerce, while Wal-Mart was struggling! On Day 1, Jet.com created curiousness with the news that it wants to compete with Amazon! Naturally Walmart tracked it!
- Examine your product’s features from the point of view of market demand. Even if all your competitors have filled the current market needs, they may have accidentally left a small hole for you. Position your product to fit there!! That is your secret sauce!! (Go back and study the secret sauces of Whole Foods WhatsApp and Jet.com.
- Position your product well. The following are two interesting stories that I have observed in the Indian market, when I was in India earlier this month. One is that of Oppo – a cell phone company and the other is Lalithaa Jewelers – a jewelry chain. Both of them have very ORDINARY PRODUCTS, but the way they positioned their products is what mattered. OPPO positioned its smart phone as the Selfie Expert! (as if the other cellphones brands are not useful for selfies), Lalithaa Jewelers found a hole in the Jewelry business (pricing) and built its campaign around that! Boom!! It is reaching revenues worth $10bn soon!
- Offer exclusivity. Everyone wants to feel special when buying something or being served. Big brands serve enormous customer bases and while their offerings are often top-notch, the feel of exclusivity is seldom there. This creates a great vacuum that smaller brands can explore. Just personalize shopping experiences and watch wonders unfold! Study the launching of Jet.com here.
- Value your customers and care for savings. Customers respect their money and time. Reciprocate the same and save their money and time by way of defining pricing and savings.
- Build momentum in stages. When you launch a new company or offer a fresh service, the impulse is to roll it out all at once. While you have all the right to offer as much or as little you wish, the smart way is to let the momentum grow. Give them a little and then add a little more. When you roll out offerings in stages, every new product/service turns into an exclusive offering. Also, you save buyers a ton of confusion by offering fewer options at the start.
- Scale matters Some startups don’t match the ambition of their promotors or VCs because of the scale of their launch, or the no of transactions possible to support the net revenue when fully adopted. For example, almost every new service wants to go ‘national’ with their service or product. But sometimes, the resources only make for a localized launch.
- Content, Inventory and Services. Make sure, what you are entering into! Are you a startup with own your inventory, content, and service providers? Or Are you just a platform? Answer those questions correctly! Examples: Google, LinkedIn, and Facebook don’t generate the content, while Yahoo! does! GrubHub doesn’t cook! Uber doesn’t own fleet! Please the read the failure stories of Prim, Dinr, Cherry.
- Share to grow. To unlock the unknown potential of your startup, share with co-founders, core team and investors and grow.
To conclude, for a startup, Ordinary is Good Enough, provided you carefully consider the above points and focus on them.
Please watch for us these links as we launch our startup, Onata, soon! Follow our exclusive services such as neighborhood services, and lend and borrow services.
The author Krishna Vemuri is the CEO of Futran Solutions, Inc. Futran Solutions has recently acquired an App development company called Apportunity. Dev Gupta, Digital Marketing Manager at Apportunity has helped in authoring this article.