How to be a market leader

Latest posts by Jonathan Hudson (see all)

Question: What do Microsoft, Martha Stewart, and "Double Your Dating" all have in common that make them market leaders?

Answer: They own a platform

When Microsoft was starting out, their mission statement went something like: "Computing power is moving inexorably to the desktop. To succeed, we must own the desktop." Smart move, that.

Microsoft and the other companies I’ve mentioned above have all become market leaders by owning the platform on which many other businesses have been founded. Examples abound in the technology community (Dell, Cisco, Oracle, I could go on…) but, for the sake of perspective, let’s look at Double Your Dating.

This company provides electronic media and seminars for men who want to improve their dating life. Kinda like my company. Many of our clients say their advice isn’t as good, but through very aggressive marketing and an understanding of what men respond to, they’ve managed to create a platform of language and product categories that other businesses have been born to supplement. (As an aside, they’ve also been around for many years more than us).

How do these companies do it? In short, they:
1.) identify the long-term possibilities in a market. I’m talking 5-10 years out.
2.) create a key platform element. "desktop" for Microsoft, "search" for Google, "database" for Oracle
3.) Proliferate that platform element by either having the best product, the best marketing, or the best deal-making. It doesn’t have to be all three: Google has won on technology, but MSFT had some key early deals with an inferior product.

These businesses, in building out the core platform, don’t let themselves get sidetracked by opportunistic endeavors that are not part of their long-term visions.

For more on this topic, check out a book called "The Only Sustainable Edge: Why Business Strategy Depends on Productive Friction and Dynamic Specialization," by John Hagel and John Seely Brown. It’s even denser than it sounds, but ideas abound within. JSB’s other work, "The Social Life of Information," is also an awesome book and one of my favorite IT-ish books.

Also, have a look at Robert Cringley’s recent blog, wherein he states that Google will rule as all, including MSFT. I don’t agree with it all, but it’s an interesting read.

Bonus points to whomever can identify one other remarkable point of similarity between these companies. Hint: it is not a cause of their success, but an effect.

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