Wanna play a game? I call dibs on moving first.
There are numerous games where the player who goes has a higher likelihood of winning than their competitor. It goes by the expression ‘First-Mover Advantage’.
In chess, by way of example, unless both players are equally-matched mega grandmasters, Blue Ocean Strategy, the well-known business book with over 4m sales and available in 40 languages, is basically about securing first-mover advantage.
There many examples of businesses who pretty much owned a particular market niche or product category by introducing a product or service where none existed before, dominating the segment for years afterwards.
One of my favorite examples is Kodak. In 1889 Kodak were the first company to mass-produce cameras. The box-shaped camera came preloaded with film enough for 100 exposures, and when you had finished the roll you had to send the whole camera to Kodak for processing. For more than ten years the only prebuilt, ready-to-shoot camera you could buy was from Kodak.
First-mover advantage can provide business credibility and acclaim. Since you’re the main player in a space without a existing dominant incumbent, customer identification of your product or service centers around your business – and your business only.
The headstart gives you a clear path regarding sales, marketing, advertising, brand recognition, and public relations. Additional signals such as intellectual property, copyright, patents, or trademarks help bolster first-mover position.
First-Movers Are More Likely To Be Failures
But for every business that succeeded – however briefly – with a first-mover advantage strategy there are hundreds that failed.
Most people may think Amazon pretty much invented buying books over the web, right? But in 1992, two full years before Amazon was founded, a gentleman by the name of Charles Stack launched Archie (1990), Excite (1993), Yahoo!, Lycos, and AltaVista (all 1994).
Social Media Channels
Before Facebook, Twitter, Instagram, or Snapchat there were sites such as AWS (used by Spotify, Pinterest, Airbnb and Netflix) or Google Cloud (Shazam, Evernote, Domino’s, Feedly, Vimeo) – making life that much harder.
Then there’s the very real and expensive problem of having to Waymo it’so false. Perhaps Tesla’s potential function (and cash cow) lies in the supply of parts such as batteries to other producers. Just like how an iPhone today uses a display created by Samsung.
Ultimately It’s The Market That Decides
Markets aren’t commanded. Finally, market domination is determined by whoever is to best meet the requirements of the customer. In a growing market space this usually means accepting those needs could be cloudy now, but will evolve and solidify on time.
You’ve been reading The Business Myth Of First-Mover Advantage on KEXINO, a promotion site for startups and Compact businesses by Gee Ranasinha. For more like this follow Gee on Twitter, Facebook or LinkedIn.
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