What Is the Biggest New Idea in Your Market?
“Who in Europe could have thought of the disappearing bed, a bed during the night, a handsome wardrobe during the day? Where else [than in the United States] could the rocking chair have been invented, in which a man could move and sit still at the same time?” – Luigi Barzini (O America, 1977)
About 20 years ago, my then partner and I started an annual meeting of the top executives of the investment-newsletter publishing industry, such as it was. One of the most popular parts of that meeting was the half-hour we spent talking about “the best thing that happened to us” that year. That was a great opportunity to figure out why certain businesses were doing so well, and most of the attendees were perfectly happy to brag about their greatest success.
Hearing about a great idea and doing something about it are two very different things. What most surprised me about the investment publishers’ seminar was how few of the “great new ideas” were imitated. For one reason or another, most of those new practices remained the private money trees for the publishers who planted them.
Not for my partner and me. We made it our business to knock off every good idea we could find. We sometimes executed our knock-offs too clumsily and, as a result, generated some resentment and even some reprisals. But our business grew from $2 million or $3 million when we started doing this to $135 million when we retired, primarily by capitalizing on the great new ideas of other people.
We were givers as well as takers. Every successful new idea we came up with was candidly explained and proudly touted. Yet most of them were never imitated. This pattern of inertia has continued to the present day. My main client is still a member of this group and has, in the past four years, touted two major marketing breakthroughs with combined sales that now total about $50 million a year. Despite four years of telling everyone else how good these ideas were, and even offering to help others implement them in their own businesses, only one of the eight or 10 publishers who learned about them has followed through. (Note: Would it surprise you to know that at our last meeting only two publishers reported growth in profits? Our business and the one that did follow our lead.) I understand why great ideas don’t get imitated, but none of the reasons (pride, fear, the failure of subordinates to buy into the idea, or whatever) is a good one.
This morning, I was looking at a sales report for a nutritional business I consult with. One idea I had suggested to them several years ago showed a $40,000 profit for a single month. I knew that when we introduced this idea we were the only ones using it — but now that it’s been out there in the marketplace for more than four years, I wondered aloud how many of their competitors were doing the same thing.
“Only one,” I was told.
What are the best new ideas in your industry this year? Do you know? Have you figured out how they could work in your business? Have you convinced your key people to try them out? Have you put them into action? If not, you’re not doing everything possible to make your business super-profitable.