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Play Stupid Games, Win Stupid Prizes.html
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Play Stupid Games, Win Stupid Prizes.html
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<html>
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<link rel="stylesheet" href="styles2.css" />
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<p>![[Naval-Ep32.mp3]]</p>
<p>Competition will blind you to greater games</p>
<p>Businesses that seem like they’re in direct competition really aren’t</p>
<p>
<strong>Nivi:</strong> When you’re being authentic, you don’t mind
competition that much. It pisses you off and inspires some fear, jealousy
and other emotions. But you don’t really mind because you’re oriented
towards the goal and the mission. Worst-case, you might get some ideas
from them. And often there are ways to work with the competition in a
positive way that ends up increasing the size of the market for you.
</p>
<p>
<strong>Naval:</strong> It depends on the nature of the business. The best
Silicon Valley tech industry businesses tend to be winner-take-all. When
you see competition, it can make you fly into a rage. Because it really
does endanger everything you’ve built.
</p>
<p>
If I’m opening a restaurant and a more interesting version of the same
restaurant opens in a different town, that’s fantastic. I’m going to copy
what’s working and drop what’s not working. So it depends on the nature of
the business.
</p>
<p>
Often, businesses that seem to be in direct competition really aren’t.
They end up adjacent or slightly different. You’re one step away from a
completely different business, and sometimes you need to take that step.
You’re not going to take it if you’re busy fighting over a booby prize.
</p>
<p>
You’re playing a stupid game. You’re going to win a stupid prize. It’s not
obvious right now because you’re blinded by competition. But three years
from now, it’ll be obvious.
</p>
<p><strong>My first company got caught in the wrong game</strong></p>
<p>
One of my first startups was
<a
href="https://www.google.com/search?q=epinions&rlz=1C1CHBF_enUS795US795&oq=Epinions&aqs=chrome.0.0l6.216j0j9&sourceid=chrome&ie=UTF-8"
>Epinions</a
>, an online product review site that was independent of Amazon. That
space eventually turned into TripAdvisor and Yelp, which is where we
should have gone.
</p>
<p>
We should have done more local reviews. A review of a scarce item
like a local restaurant is more valuable than one of an item like a
camera that has 1,000 reviews on Amazon.
</p>
<p>
Before we could get there, we got caught up in the comparison-shopping
game. We merged with DealTime and competed with a bunch of
price-comparison engines—mySimon, PriceGrabber, NexTag and Bizrate, which
became Shopzilla. We were caught in fierce competition with each
other.
</p>
<p>
That whole space went to zero because Amazon won e-tail completely. There
was no need for price comparison. Everyone just went to Amazon.
</p>
<p>
We got the booby prize because we were caught up in competition with a
bunch of our peers. We should have been looking at what the consumer
really wanted and being authentic to ourselves, which was reviews, not
price comparison. We should have gone further into esoteric items where
customers had less data and wanted reviews more badly.
</p>
<p>If we stayed authentic to ourselves, we would have done better.</p>
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