How Small Companies Compete with — and Beat — Big Ones

In an era driven by network effects, smaller players struggle to compete against bigger platforms. The trick to gaining ground on a much larger rival, says Harvard Business School professor Felix Oberholzer-Gee, is choosing a strategy that can’t easily be imitated.

A good example is TaoBao’s strategy for displacing eBay in China. Back in 2007, eBay was the world’s largest consumer marketplace, and TaoBao was an underdog with bold new ideas about how to build trust with customers who were reluctant to shop online.

“In fact, the market that Taobao targeted ended up being so much more important than eBay’s market,” Oberholzer-Gee tells Cold Call host Brian Kenny. “[A]nd eBay eventually left China.”

Key topics include: sales, hiring, compensation and pay, communication, performance management, and leadership development, competition, competitive markets, and innovation.

HBR On Strategy curates the best case studies and conversations with the world’s top business and management experts, to help you unlock new ways of doing business. New episodes every week.

• Listen to the original HBR Cold Call episode: Strategies for Underdogs: How Alibaba’s Taobao Beat eBay in China (July 2021)
• Find more episodes of Cold Call.
• Discover 100 years of Harvard Business Review articles, case studies, podcasts, and more at HBR.org.