Dialogue. How to Identify a Great Business
The Synopsis
Competing Against Amazon by Hitting Different Consumer Preferences
To effectively compete against Amazon, it is crucial to target different consumer preferences rather than directly challenging Amazon's strengths. By offering a disruptive alternative, such as slower shipping at a lower cost, companies can appeal to consumers who prioritize different factors over speed. This strategy disrupts Amazon by revealing or shifting consumer preferences. For example, Teemu's success stemmed from catering to customers uninterested in fast shipping and offering lower-priced, lower-trust products. This approach allows companies to gain ground on Amazon initially by meeting unique preferences and eventually expanding to traditional preferences, like faster shipping, as they build volume and infrastructure. This aligns with the traditional disruptive framework, where companies start with different preferences, gradually converge towards incumbent offerings, and ultimately challenge them.
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