One of the key principles I teach my founder CEOs is the importance of finding a gap in the marketplace to focus on.
If you do exactly what your competitors do, product-wise, and target the exact same ideal customer, then your only option is to outperform.
However, instead of (or in addition to) outperforming, you can also outmaneuver them strategically.
In a boxing match, it is one thing to exchange punches with your opponent until one of you falls down. However, it is preferable to punch an opponent while also avoiding being punched yourself. The former is outperforming. The latter is outmaneuvering.
I’ve found many fascinating stories that came out of the Olympics.
One of them is the Chinese government’s multi-decade strategy to win more gold medals than any other country in the world.
First off, the explicit purpose of China’s Olympic program is to win gold medals. They have explicitly stated that silver medals don’t count for much… only gold ones.
You can agree or disagree with this objective. That said, their goal is very clear.
They analyzed all the various sports and how many gold medals are awarded for each.
They also analyzed the relative popularity of these sports in the United States and Europe. They then estimated the relative funding of training programs in Western countries by sport and by gender.
What they determined was that Western nations underfund women’s sports compared to male sports.
They also found that certain sports aren’t as popular with Americans and Europeans (like weightlifting… especially women’s weightlifting), and these sports award multiple gold medals (one for each weight class).
While this year’s Olympics is the first gender-balanced Olympics in history (almost exactly 50% male vs. 50% female athletes), China’s team at the Tokyo games is 70% women.
Chinese culture is hardly known for valuing gender equality.
It is, however, a culture hell-bent on winning… and winning gold.
This is why there are so many Chinese women in weightlifting.
Keep in mind, weightlifting is not popular at all in China with the average person.
When was the last time you saw a photo of a Chinese man flexing his biceps or six-pack?
What the government does is identify promising athletic girls in elementary school. These promising child athletes are then sent off to specialized training centers to further develop their skills for the sole purpose of winning Olympic gold medals.
Is this strategy extreme?
Is the approach highly strategic?
Would I want my daughters to be a part of China’s Olympic gold-medal-producing machine?
Absolutely not (but that’s not the point).
What China has done is systematically analyze the “market” to find “gaps” in the marketplace.
Then, they looked at their own “capabilities” to find a way to fill those market gaps.
This process is what you must do if you want to “win gold” in your marketplace.
It’s difficult to go head-to-head against other competitors… especially if they are larger and more established than you.
It’s far easier to over-invest in highly profitable “market segments” that others under-invest in.
Over the years, quite a few of my clients have made the Inc. 500/5000 lists.
The #1 “technique” I have them do to achieve the level of growth (typically 600% growth in three years) to make the Inc. 500/5000 lists is to massively “over-invest” in market gap opportunities — opportunities that were highly attractive and already working well on a smaller scale.
Being “better” than your competitors is expensive.
Being “different” from (a.k.a. more strategic than) your competitors is often a lot easier.
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