Are big players in niche genre afraid of competition from new and small entrepreneurs?

By anand nair on January 31, 2011 23 Comments / 1900 views

It happened to me and am sure it happens everywhere. But why are the biggies who are respected and have been there for 10 -15 years in the market feeling very insecure of new entrants? This is happening in the online space (B2B) in the genre of media, advertising, marketing. The first thing that comes to their mind is to kill the product and the spirit of the entrepreneur by hook or crook. It is presumed that competition is always healthy so why are the biggies afraid of competition? Nobody has the monopoly over competition in a democratic set up like we have in India?

Comments

anand nair

23 Comments

Anushka Shroff January 31, 2011, 3:27 am

The biggies have taken almost 10 to 15 years to reach there….

The new enterpreuneures dare to be different and what the biggies acheived in 15 years…..the new enterpreneurs will achieve it in 7 to 8 years …one has to go with the pace…

and so the new entrants maybe a threat to the biggies 🙂
anand nair January 31, 2011, 3:35 am

thanks anushka, I think they should perceive competition as partner in progress and not be afraid of them. Either they are too complacent or they lack ideas to compete. For them the best is to kill the competition and in long run it won’t do good to them.

Anushka Shroff said:

The biggies have taken almost 10 to 15 years to reach there….

The new enterpreuneures dare to be different and what the biggies acheived in 15 years…..the new enterpreneurs will achieve it in 7 to 8 years …one has to go with the pace…

and so the new entrants maybe a threat to the biggies 🙂
Anushka Shroff January 31, 2011, 3:55 am

I think a successful enterprenuer is blessed with the competency of being creative….in which he/she excels , moving forward upward….who has the guts for believing in their own ideas, innovations, initiatives beyond the envy of others ……and should be able to manage an uncertainity in business frameworks and grab new opportunities …………rather than killing completion,.which is escapism ..

anand nair said:

thanks anushka, I think they should perceive competition as partner in progress and not be afraid of them. Either they are too complacent or they lack ideas to compete. For them the best is to kill the competition and in long run it won’t do good to them.

Anushka Shroff said:

The biggies have taken almost 10 to 15 years to reach there….

The new enterpreuneures dare to be different and what the biggies acheived in 15 years…..the new enterpreneurs will achieve it in 7 to 8 years …one has to go with the pace…

and so the new entrants maybe a threat to the biggies 🙂
TMS.Shammie January 31, 2011, 4:52 am

I think the statement.. “Survival of the fittest” which has ruled everything in this world since ages even applies to business.. Competition no doubt is good but at the same time my view is that if you can you should outrun the competition and make them go away..

Just look at it this way… would you let businesses thrive when you know that they can grow up cut down your market.. your income.. your business.. 🙂

“Survival of the fittest.” =)
prashant satav January 31, 2011, 5:00 am

Hi Anand,

I am completely in sync with you on this..are the biggies insecure and not confident about their products?
Anushka Shroff said:

The biggies have taken almost 10 to 15 years to reach there….

The new enterpreuneures dare to be different and what the biggies acheived in 15 years…..the new enterpreneurs will achieve it in 7 to 8 years …one has to go with the pace…

and so the new entrants maybe a threat to the biggies 🙂
Anushka Shroff January 31, 2011, 5:06 am

Hi

It’s not only “Survival of the fittest”…..with the burning desire to be the best …and being the best , by default kills competition…:)

TMS.Shammie said:

I think the statement.. “Survival of the fittest” which has ruled everything in this world since ages even applies to business.. Competition no doubt is good but at the same time my view is that if you can you should outrun the competition and make them go away..

Just look at it this way… would you let businesses thrive when you know that they can grow up cut down your market.. your income.. your business.. 🙂

“Survival of the fittest.” =)
anand nair January 31, 2011, 5:13 am

Dear Shammie,

Thanks for your inputs. I too believe in ‘Survival of the fittest’ and this could be the very reason for biggies not to kill the competition. If they are fit and fine, why get into such act in the first place, as a leader, accept it and fight it out in the market and not get into other means of killing the competition. Be in the market and face it and fight it out…that’s way it should be and everyone would respect you for that.

It’s only them who have been the inspiration for small players to come into their league, let the market, product, service and consumer dictate and not otherwise.

TMS.Shammie said:

I think the statement.. “Survival of the fittest” which has ruled everything in this world since ages even applies to business.. Competition no doubt is good but at the same time my view is that if you can you should outrun the competition and make them go away..

Just look at it this way… would you let businesses thrive when you know that they can grow up cut down your market.. your income.. your business.. 🙂

“Survival of the fittest.” =)
TMS.Shammie January 31, 2011, 9:17 am

Agreed, every company needs to make their product line strong. And every company always does that. My point is if it possible why not try and cut down on competition? If the competition is being cutdown down by ethical means i for no reason see any harm in doing so.. i may not concern and concentrate my actual efforts on that though..

In todays world there’s competition everywhere, killing the competition depends on how you choose to do it.. for example, i may be giving an entrance exam for a premier college seat. I have more resources at my hand to utilize then alot of other candidates.. to me using those resources is a way to cut down on competition cause it gives me more insights to crack the exam.. some points which they would not come to know.. Does this mean that i should not use it? Does it mean that i should not use the extra resources that i have so that the playground is fair for all?

Regards,
TMS

Jyoti Shukla said:

@ anand: “Either they are too complacent or they lack ideas to compete.” I think it’s more like lack of ideas.

@TMS.Shammie: Focusing of “making one’s line longer” than focusing on “cutting the other’s line shorter ALWAYS wins in the end and those who focus on how to kill the competition instead of focusing on how to grow themselves end up being the biggest losers. This is nature’s law, you focus on others, you lose. You focus on yourself, you win.
TMS.Shammie January 31, 2011, 9:22 am

Hi Anand,

I feel that you have been at a receiving end of an unethical way of cutting down competition. Something which is not fair in your mind. Unfortunately i don’t know what happened which prompted you to start the discussion.. could share the experience.. it would at the very least help me understand what is it that entrepreneurs should be on a look out for when bigger companies look to cut them down..

Regards,
TMS

anand nair said:

Dear Shammie,

Thanks for your inputs. I too believe in ‘Survival of the fittest’ and this could be the very reason for biggies not to kill the competition. If they are fit and fine, why get into such act in the first place, as a leader, accept it and fight it out in the market and not get into other means of killing the competition. Be in the market and face it and fight it out…that’s way it should be and everyone would respect you for that.

It’s only them who have been the inspiration for small players to come into their league, let the market, product, service and consumer dictate and not otherwise.

TMS.Shammie said:

I think the statement.. “Survival of the fittest” which has ruled everything in this world since ages even applies to business.. Competition no doubt is good but at the same time my view is that if you can you should outrun the competition and make them go away..

Just look at it this way… would you let businesses thrive when you know that they can grow up cut down your market.. your income.. your business.. 🙂

“Survival of the fittest.” =)
TMS.Shammie January 31, 2011, 9:37 am

Precisely, but what i am doing is still cutting down on competition 🙂

Regards,
TMS

Jyoti Shukla said:

@TMS.Shammie : I think we both are saying same thing in different words:)

Take your example of using extra resources to get ahead of competition.

If you have extra resources that give you an edge over the competition and you spend your time and energy in utilize those resources to “build your strength”, then you sure are a winner because you are focusing on yourself.

If you spend your time and energy in making sure that the competitor does not get access to those same extra resources, then sooner or later you are going to end up as a loser because you would be focusing on someone/ something other than yourself.

TMS.Shammie said:

Agreed, every company needs to make their product line strong. And every company always does that. My point is if it possible why not try and cut down on competition? If the competition is being cutdown down by ethical means i for no reason see any harm in doing so.. i may not concern and concentrate my actual efforts on that though..

In todays world there’s competition everywhere, killing the competition depends on how you choose to do it.. for example, i may be giving an entrance exam for a premier college seat. I have more resources at my hand to utilize then alot of other candidates.. to me using those resources is a way to cut down on competition cause it gives me more insights to crack the exam.. some points which they would not come to know.. Does this mean that i should not use it? Does it mean that i should not use the extra resources that i have so that the playground is fair for all?

Regards,
TMS

Jyoti Shukla said:

@ anand: “Either they are too complacent or they lack ideas to compete.” I think it’s more like lack of ideas.

@TMS.Shammie: Focusing of “making one’s line longer” than focusing on “cutting the other’s line shorter ALWAYS wins in the end and those who focus on how to kill the competition instead of focusing on how to grow themselves end up being the biggest losers. This is nature’s law, you focus on others, you lose. You focus on yourself, you win.
pankaj khandelwal February 3, 2011, 7:32 am

yeah,i think if you are the best ,you survive naturally and move ahead much faster….competition ,be it from the big ones or the small ones,from the already settled to the emerging,all become theoretical at that stage.

Anushka Shroff said:

Hi

It’s not only “Survival of the fittest”…..with the burning desire to be the best …and being the best , by default kills competition…:)

TMS.Shammie said:

I think the statement.. “Survival of the fittest” which has ruled everything in this world since ages even applies to business.. Competition no doubt is good but at the same time my view is that if you can you should outrun the competition and make them go away..

Just look at it this way… would you let businesses thrive when you know that they can grow up cut down your market.. your income.. your business.. 🙂

“Survival of the fittest.” =)
Anushka Shroff February 4, 2011, 3:22 am

Thums up..!!!

pankaj khandelwal said:

yeah,i think if you are the best ,you survive naturally and move ahead much faster….competition ,be it from the big ones or the small ones,from the already settled to the emerging,all become theoretical at that stage.

Anushka Shroff said:

Hi

It’s not only “Survival of the fittest”…..with the burning desire to be the best …and being the best , by default kills competition…:)

TMS.Shammie said:

I think the statement.. “Survival of the fittest” which has ruled everything in this world since ages even applies to business.. Competition no doubt is good but at the same time my view is that if you can you should outrun the competition and make them go away..

Just look at it this way… would you let businesses thrive when you know that they can grow up cut down your market.. your income.. your business.. 🙂

“Survival of the fittest.” =)
Munish Goyal February 5, 2011, 1:20 pm

Hi Anushka,

You mentioned ‘burning desire to be the best’. That is there in the new entrant entrepreneur, but mostly in lesser level in the biggies. To workaround that, as Anand said, the first thing comes to mind is kill the new guy (competition), because other than money power (brute force) there is no other thing in sight.

Remember, Jack Welch of GE used to hive off teams from GE to startups and get the best work done and then used to buy back those startups for GE.

Environment in biggies become relaxed and they have found their comfort zone in running fixed lines of business which they continue to keep growing at predictable rates, but new guys has everything at stake and pushes every pedal to make it. 🙂
Deepesh Krishnan February 6, 2011, 9:14 am

Well what answers do we have for the obvious things that these “Biggies” have enveloped themselves in, typical questions that i had to face were like,

– how big is you team?

– how many offices do you have?

– what if you get a offer two times what you are earning for US firm?

– How many such installations do you have?

What clients might not know but these biggies know is,

– How many time have you not screwed up and delivered

– Within time and budget

– Larger firms might ditch them faster and are difficult to trace

– with a smaller team which is just what is required, not pay extra for larger useless team

– for an out of the box solution you need just ONE installation/client that’s you
Munish Goyal February 6, 2011, 6:13 pm

Jyoti,

And you see similar stories in tech. sector . The biggies acquire a number of companies every year. And most of them (the acquired technology and the team) dont end up in a product but actually die down inside the biggie. So it goes like…if you cant beat them, buy them 🙂

Jyoti Shukla said:

@Munish: reminds me of a newspaper war in early 90’s in Mumbai. The old and number one player in this space was suddenly threatened by a new entrant which proved to be gaining popularity (and subscriptions) by leaps and bounds due to its young team and superior product quality. The old player had money power so instead of improving its own quality and facing the competition, it bought over the whole editorial team of the new paper by offering 2-3 times more salaries and launched a carbon copy of the new paper. Naturally, the young competitor folded up. The old player kept publishing the carbon copy newspaper for an year and then one fine day just shut down its operations and threw out the team. It had no intention of having another publication, its sole intention was just killing the competition.

Sadly, it was the reader’s loss who could have benefited by healthy competition between two newspapers if not for the cowardice of the older (and stale) player.

Munish Goyal said:

Hi Anushka,

You mentioned ‘burning desire to be the best’. That is there in the new entrant entrepreneur, but mostly in lesser level in the biggies. To workaround that, as Anand said, the first thing comes to mind is kill the new guy (competition), because other than money power (brute force) there is no other thing in sight.

Remember, Jack Welch of GE used to hive off teams from GE to startups and get the best work done and then used to buy back those startups for GE.

Environment in biggies become relaxed and they have found their comfort zone in running fixed lines of business which they continue to keep growing at predictable rates, but new guys has everything at stake and pushes every pedal to make it. 🙂
Koshy T February 7, 2011, 3:12 am

As many pointed out, competition means the other guy will want and try to kill you. Higher the stake involved in the area you are muzzling in, the more severe will be the resistance.
The means used by the other to put you down will vary, but mostly they will try everything what is legally allowed and sometimes what is not legally allowed. If the latter happens you need to legal / PR/ route to supplement your product, price and marketing strategy.
Anindya Chatterjee February 7, 2011, 6:03 am

If you have a me too idea, then your chance of survival is low. However, if you are different- really really different with a unique value- who can kill you?

Build a differentiated business.
anand nair February 7, 2011, 3:46 pm

Dear Shammie,

Its nice to know that you are interested in knowing what prompted me to write this. I have been part of the development and growth path of at least two big players in this genre, one is the so called leader of over 10 years in existence and other one with 3 years in existence…they have been the growth drivers in this niche and I have helped them in every sphere of activity and my only mistake was that I didn’t join them (board of director) directly or indirectly. I always aspired to be an entrepreneur and I was waiting for the right time. I had left them when I thought I had brought them to a level where they can be taken care off by others. All I wanted was to move out in a respectable manner.

I informed them that I want to pursue my own dream which I think everyone has a right to. I had given out my work to freelance developer and the day I was about to launch it, they got to know about it and bought the design, source code and other relevant things that’s necessary for a site to run from the developer ( he says that he was threatened and forced to do so). In this process not only I lost my clients but also database and money invested into the business. I was literally left with nothing..nothing at all. Not only that, I have been told that they are trying to fix me with some false case and try to implicate me one way or other. They tried to kill my dream, business, source of income and physiologically make me weak. Till date they have not paid my salary of two months. That’s when this question came to my mind and I initiated this.

Nevertheless, I have managed to bounce back, thanks to my well wishers and friends, very soon I would be able to relive my dream.

TMS.Shammie said:

Hi Anand,

I feel that you have been at a receiving end of an unethical way of cutting down competition. Something which is not fair in your mind. Unfortunately i don’t know what happened which prompted you to start the discussion.. could share the experience.. it would at the very least help me understand what is it that entrepreneurs should be on a look out for when bigger companies look to cut them down..

Regards,

TMS

anand nair said:

Dear Shammie,

Thanks for your inputs. I too believe in ‘Survival of the fittest’ and this could be the very reason for biggies not to kill the competition. If they are fit and fine, why get into such act in the first place, as a leader, accept it and fight it out in the market and not get into other means of killing the competition. Be in the market and face it and fight it out…that’s way it should be and everyone would respect you for that.

It’s only them who have been the inspiration for small players to come into their league, let the market, product, service and consumer dictate and not otherwise.

TMS.Shammie said:

I think the statement.. “Survival of the fittest” which has ruled everything in this world since ages even applies to business.. Competition no doubt is good but at the same time my view is that if you can you should outrun the competition and make them go away..

Just look at it this way… would you let businesses thrive when you know that they can grow up cut down your market.. your income.. your business.. 🙂

“Survival of the fittest.” =)
anand nair February 7, 2011, 3:55 pm

Dear Jyoti,

You are right about the competition. And I believe its always better for bigger players to fight it out in open than trying the other way round. What is that biggies are worried about? If you are good and always emulate yourself, why worry? Its always good to have competition, it helps market grow. By killing competition you are showing how insecure the biggies are in the market. The concept of big fish eating small is natures way of showing survival but what if there are no smaller players, who is going to suffer the most, of course the consumers. Lets fight it out in open and leave it to the market to decide who wins and not kill competition for the sake of survival.

Regards

Anand

Jyoti Shukla said:

@Munish: reminds me of a newspaper war in early 90’s in Mumbai. The old and number one player in this space was suddenly threatened by a new entrant which proved to be gaining popularity (and subscriptions) by leaps and bounds due to its young team and superior product quality. The old player had money power so instead of improving its own quality and facing the competition, it bought over the whole editorial team of the new paper by offering 2-3 times more salaries and launched a carbon copy of the new paper. Naturally, the young competitor folded up. The old player kept publishing the carbon copy newspaper for an year and then one fine day just shut down its operations and threw out the team. It had no intention of having another publication, its sole intention was just killing the competition.

Sadly, it was the reader’s loss who could have benefited by healthy competition between two newspapers if not for the cowardice of the older (and stale) player.

Munish Goyal said:

Hi Anushka,

You mentioned ‘burning desire to be the best’. That is there in the new entrant entrepreneur, but mostly in lesser level in the biggies. To workaround that, as Anand said, the first thing comes to mind is kill the new guy (competition), because other than money power (brute force) there is no other thing in sight.

Remember, Jack Welch of GE used to hive off teams from GE to startups and get the best work done and then used to buy back those startups for GE.

Environment in biggies become relaxed and they have found their comfort zone in running fixed lines of business which they continue to keep growing at predictable rates, but new guys has everything at stake and pushes every pedal to make it. 🙂
anand nair February 7, 2011, 4:00 pm

Ture Anindya, I fully believe on this. Its the differentiators that can keep you going. But what to do when your product (in this case design and source codes of site) is taken / bought over by biggie by force from the developer. I think this can be a short term to stop or kill competition but not a long term solution.

You have to allow differentiators to be seen by people, what happens when its killed before that?

Regards

Anand
Anindya Chatterjee said:

If you have a me too idea, then your chance of survival is low. However, if you are different- really really different with a unique value- who can kill you?

Build a differentiated business.
anand nair February 7, 2011, 4:03 pm

Dear Munish,

I agree to what you say.

anand nair said:

Dear Jyoti,

You are right about the competition. And I believe its always better for bigger players to fight it out in open than trying the other way round. What is that biggies are worried about? If you are good and always emulate yourself, why worry? Its always good to have competition, it helps market grow. By killing competition you are showing how insecure the biggies are in the market. The concept of big fish eating small is natures way of showing survival but what if there are no smaller players, who is going to suffer the most, of course the consumers. Lets fight it out in open and leave it to the market to decide who wins and not kill competition for the sake of survival.

Regards

Anand

Jyoti Shukla said:

@Munish: reminds me of a newspaper war in early 90’s in Mumbai. The old and number one player in this space was suddenly threatened by a new entrant which proved to be gaining popularity (and subscriptions) by leaps and bounds due to its young team and superior product quality. The old player had money power so instead of improving its own quality and facing the competition, it bought over the whole editorial team of the new paper by offering 2-3 times more salaries and launched a carbon copy of the new paper. Naturally, the young competitor folded up. The old player kept publishing the carbon copy newspaper for an year and then one fine day just shut down its operations and threw out the team. It had no intention of having another publication, its sole intention was just killing the competition.

Sadly, it was the reader’s loss who could have benefited by healthy competition between two newspapers if not for the cowardice of the older (and stale) player.

Munish Goyal said:

Hi Anushka,

You mentioned ‘burning desire to be the best’. That is there in the new entrant entrepreneur, but mostly in lesser level in the biggies. To workaround that, as Anand said, the first thing comes to mind is kill the new guy (competition), because other than money power (brute force) there is no other thing in sight.

Remember, Jack Welch of GE used to hive off teams from GE to startups and get the best work done and then used to buy back those startups for GE.

Environment in biggies become relaxed and they have found their comfort zone in running fixed lines of business which they continue to keep growing at predictable rates, but new guys has everything at stake and pushes every pedal to make it. 🙂
anand nair February 7, 2011, 4:08 pm

True Munish, biggies become too cozy with their environment. The new guy in his pursuit to become big looks and create opportunities that the biggies are or were blind too. I think biggies have to respect the competition and that’s the only way to grow the market. Why can’t this be taken in stride and compete in this way biggies will always get the respect that they deserve. Killing competition shows their insecurity.

Munish Goyal said:

Hi Anushka,

You mentioned ‘burning desire to be the best’. That is there in the new entrant entrepreneur, but mostly in lesser level in the biggies. To workaround that, as Anand said, the first thing comes to mind is kill the new guy (competition), because other than money power (brute force) there is no other thing in sight.

Remember, Jack Welch of GE used to hive off teams from GE to startups and get the best work done and then used to buy back those startups for GE.

Environment in biggies become relaxed and they have found their comfort zone in running fixed lines of business which they continue to keep growing at predictable rates, but new guys has everything at stake and pushes every pedal to make it. 🙂
anand nair February 7, 2011, 4:11 pm

Dear Koshy, I too have take this course and am ready for the reply. I believe that I have a strong product and will leave the market to decide which one to survive. As they say ‘you can kill the body, but you can’t kill the soul’.

Regards

Anand

Koshy T said:

As many pointed out, competition means the other guy will want and try to kill you. Higher the stake involved in the area you are muzzling in, the more severe will be the resistance.
The means used by the other to put you down will vary, but mostly they will try everything what is legally allowed and sometimes what is not legally allowed. If the latter happens you need to legal / PR/ route to supplement your product, price and marketing strategy.