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Being Better Isn’t Good Enough

How much effort do you put into “beating your competition?”

March 01, 2023

It’s easy to fixate on what other businesses are doing — especially when you lose a customer. Focusing on what they’re doing to win, isn’t going to solve why you’re losing. The truth is … chasing better will always leave you wanting more. What actually drives demand is how you are different, not better. Here’s what most companies don’t understand: If you didn’t create the category then you need to separate yourself from it as quickly as possible.(If you want dive deeper on this idea, checkout The 22 Immutable Laws of Marketing, by Al Ries and Jack Trout.)

Don’t waste your time getting better. Focus on what sets you apart. Better might grow your business but difference is how you scale. Instead of worrying about all the things you have to change to get better (cutting costs, reducing shipping times, improving customer experience), you are laser-focused on a single question:

“What can we do that no one else can?”

Knowing what you’re uniquely capable of requires a deep and honest understanding of the strengths, capabilities and weaknesses of you and your team. Most importantly though, you have to know your customer AND the problems or friction points, they experience in your industry that everyone accepts ass just part of the process. Here are two examples of how “different” is better than “better”.

Ryanair: That’s All We Promise

Ryanair was on the brink of bankruptcy when CEO Michael O’Leary made a bold bet. He believed that most passengers would be willing to sacrifice small comforts like reclining seats or in-flight meals and entertainment if it meant saving money. O’Leary and his team even contemplated removing toilets to add more seats or charging passengers to use the onboard bathrooms.

The company’s slogan became: "We promise to get you from A to B for the lowest possible price, but that's all we'll promise."

Unwavering focus on reducing fares has led to an increase in sales and a decrease in operating costs. Today, Ryanair employs 8,500 people and generates annual revenues of more than $3 billion.

Microsoft: Lose the Hostility

Steve Ballmer served as CEO of Microsoft from 2000 to 2014, succeeding Bill Gates. During his tenure, Microsoft's share price decreased by 33%. When he resigned, the company's stock price rose 7%. (Ouch.)

Enter Satya Nadella as Microsoft CEO. During his tenure, Microsoft's valuation has multiplied nearly 10 times over as it has recovered from losses. Windows 10 and 11 have both outperformed previous versions, and Azure now commands 18% of the $500 billion global cloud market, making it the second most popular option behind Amazon Web Services.

How’d he do it?

At an event in San Francisco, he led a discussion with a giant screen behind him. He declared that “Microsoft Hearts Linux.” This was a big deal because Microsoft has historically been hostile to outside companies and open-source software projects.

Today, more than 50% of Azure's compute core runs on Linux, and Microsoft works with Apple, IBM, and Dropbox.

Compete on Your Terms

Ryanair’s Michael O’Leary and Microsoft’s Satya Nadella solved accepted, and acceptable, problems.

O’Leary directly confronted the assumption that air travelers required a balance between price and comfort. Nadella replaced a culture of “Microsoft vs everyone else” with a culture of “both-and.”

No other business in their respective industries is capable of or willing to compete on their terms. If you want to scale your business and expect your customers to advocate for you, solve problems that no one else will.

Forget what everyone else is doing. Don’t try to fix everything. Get hyper-focused on exactly one thing: what you can do that no one else can.

That's how you scale.

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