Ever wonder why some companies flounder along…
… while others become stars in their industry?
The answer is simple: they consistently create game-changing products.
If that sounds too simple to be true, if you immediately dismissed it, then this isn’t an article for you. That’s fine.
But if that simple statement intrigued you, read on. Because game changers define every aspect of your life.
The entrepreneur’s cycle, or how game changers happen
Your life has been a cycle.
Call it the entrepreneur’s cycle, or the product cycle, or the cycle of life, it doesn’t matter. At the end of the day, it’s the game-changing cycle.
It goes like this:
- Status quo—There’s an established way to do something.
- Game changer—A company or person creates a game-changing product that disrupts that cycle.
- Copycats—A wave of copycats comes along and does the same thing as the original company.
- Filtering—The market weeds out the losers, usually ending in a tooth-and-nail battle between the creator and 1-2 major competitors.
It repeats ad infinitum, across every “product,” from economic systems to streaming apps.
The funny thing is, there’s only one way to break out of the cycle:
To start the cycle again, yourself.
The secret behind companies that are always great
Here’s the premise of this article:
A business determines its long-term success by creating frequent game-changers.
But it’s easy to get confused with the definition of a game changer. So let me be clear.
A game changer is a new offering that irreversibly shifts an industry.
Typically, a gamechanger’s tectonic importance or distinguishing feature can be highlighted in a few words.
“Drive-through.”
“1,000 songs in your pocket.”
“15 minutes or it’s free.”
“DVDs by mail.”
“Free two-day shipping.”
If you can’t summarize your product like this—or your summary includes the phrase “a better…”—then you don’t have a game-changer.
A company lives and dies by its gamechangers. And it’s the primary determining factor between a successful and not-so-successful business.
Why it matters
First, a game changer means you’re first.
Steve Jobs said the first iPhone was five years ahead of any other phone, and he was right.
Imagine a world where Apple released a smartphone the day after Android. Would they be dominating the market like they do now? I doubt it.
Second, being first sets you apart, sometimes for generations.
Warner Bros. released the first feature-length film with sound.
Disney released the first full-length animated film.
Pixar released the first full-length computer animated film.
Those companies still dominate today, whether it’s 93, 83, or 25 years later.
Third, it brings lasting recognition.
Even when game-changing products become generic, it’s good for marketing.
Your Kleenex or Xerox or Coke might not be any of those brands. But those companies are still winning.
And finally, being first puts you in a unique position to create the next gamechanger.
Netflix changed the game with DVDs by mail, then streaming.
Amazon changed the game with books online, then the Kindle.
Shaping an industry once gives you a powerful position to shape it again.
The golden rule of gamechangers
Learn it, memorize it:
The more gamechanging the product, the more quickly it will be copied.
It’s basic, but we forget it.
A working competitor to the iPhone was in the marketing within a year, and now almost nobody owns a “dumb phone.”
A working competitor to the Oxo vegetable peeler took @longer, and they still sell bad vegetable peelers in Walmart, @20 years later.
If you think a trademark will save you, you’re wrong.
Copying is the highest form of flattery. A trademark helps to slow your competition down, but it will never prevent copying.
And you don’t want to prevent copying. The fact that your competitors start using your same idea—after you did, of course—gives you credence and credibility.
Once you start, you can’t stop
Game-changers become the new normal. Groundbreaking tech becomes a commodity.
What was once the king becomes barely distinguished from its competitors, then eventually killed (or slowly made irrelevant) by whatever’s next.
Netflix first rocked the movie rental business with DVDs-by-mail in 1997. Then they destroyed their own business model with streaming in 2007.
But now, a little over a decade later, it’s hard to find a media company without a streaming service.
The same goes for Spotify, with game-changing, all-you-can-listen-to music streaming that’s now indistinguishable from Google Play, Amazon Music, or Apple Music.
Netflix and Spotify are far from doomed, because they were first.
But if the past is any indicator, we should expect another gamechanger in the next ten years. If I were in charge of Netflix or Spotify, I’d be racing to get there first.
Can you survive without a game changer?
Yes, plenty of companies do.
But few become world class.
Behind the best in almost any industry is almost always a game-changer, no matter how long ago.
And the company at the top is usually the one which has released the most game-changers.
How often do you need a game changer?
My research seems to show that every five years is a good rule of thumb.
I believe that number is speeding up as tech increases—it’s hard to imagine Standard Oil or Bethlehem Steel shifting their industries twice a decade through the 1800s.
And there are some razor-edge burgeoning industries—think self-driving cars—where all market share is up for grabs and consistent gamechangers will almost certainly be necessary.
But shoot for five years on average.
There’s an important caveat—you can’t predict a true gamechanger. The Segway never did as well as they hoped.
The absolute easiest example of a company that embodies this is Apple, and their record is around once every 4-6 years—the iPod in 2001, iPhone in 2007, the iPad in 2011, the Apple Watch in 2015.
They’ve launched a number of other services and products as well, but few have been game changers.
And understand, Apple is actually very fast in the tech space.
Can you remember the last product Microsoft launched?
How to create a game changer
Once you’ve created your first game changer, you’re faced with a difficult choice:
How can you create a second one?
There are a few ways to do this.
1. Disrupt your own industry, again
This is the Netflix play—see where the future is headed, and cannibalize your own market with a new product.
If your intuition is correct, you’re set to double down on your position as a market leader.
But it can be risky. Stake too much on your new product, and you could lose the market you spent so long to create.
Skype dominated video calls to the point of becoming a verb.
Then the focused shifted. Skype believed the future was in messaging apps like Slack, WhatsApp, and Facebook Messenger.
Video innovations paused and Skype went all-in on messaging features, like profiles and emoji reactions.
Then came COVID-19.
And in six months, “I’ll Skype you” became “I’ll Zoom you.”
Skype had predicted the future, and missed.
Pivoting is fine, but be innovative in both. For a while, Netflix was the best in DVDs by mail and streaming. Amazon is still the best place to buy physical books and Kindle books.
Skype stopped being the best videocall service to become a mediocre messaging app.
2. Disrupt a new industry
Few people in the 1990s would have predicted that Walmart could successful sell food.
Stable shelf goods like ironing boards and Scrabble are very different from lettuce and peanut butter.
But the same techniques of scale, growth, capacity, and economics of scale, they did it.
And invented the Supercenter.
Leverage your strengths to another market.
3. Disrupt a new part of your market
In this version, you take your existing customers and change something related to what they’re already buying.
A good example of this is Dollar Shave club. To expand, they’ve created more products along the same line.
So instead of just razors, now you can buy all kinds of soaps and shave creams. The same target market, but different products (especially ones people were buying anyways).
4. Disrupt a new segment
In this method, you take what you already offer and extend your expertise to a new segment of people who aren’t your current customers.
Bridgewater found success with this method.
There are only so many ways to revolutionize the investment market. But by creating a product that benefits from inflation, deflation, economic growth, and economic decline, they created a tool that’s become an industry standard.
These types of innovations can be fruitful opportunities because you already understand the basics of the market, but can expand into another related segment.
To steal, to buy, or to create?
Ever heard of Boaters? Probably not.
They were the first disposable diapers. But their inventor didn’t have much budget to promote them.
Until a larger holding company bought them and created them with their own brand. You might have heard of that company—Pampers.
Game-changers aren’t always unique inventions. Quite often, they’re not.
Buying up a competitor is one strategy. So is stealing.
Snapchat invented a new way to share what was going on—a quick update that online lasted 24 hours. They called them “stories.”
Stories have become a game-changer, but most of us know them from Instagram.
Instagram copied the exact feature, and now Snapchat feels like the ripoff.
Buying can work. As can stealing. But you need at least some kind of moat. It could be expertise, experience, or a trademark.
Just enough to put a gap between you and the next runner-up.
Because otherwise, you might just give your biggest competitor their best new feature.
Your batting average doesn’t matter, only home runs
Few of us think of Google as a failing company.
But they’ve failed with Orkut, Wave, Google+, and hundreds more.
In comparison, their gamechangers are few: A search engine, free email, editable documents, an extendable browser.
The good news about gamechangers is that the percentage of success doesn’t matter. It’s the total number.
The hundreds (thousands?) of failed products disappear into the shadows when the spotlight focuses on a half-dozen rockstars.
So keep creating. Keep generating. Don’t stop.
How to create gamechangers
In 1945, the world’s top scientists bet on the outcome of the first test of the atomic bomb.
Years of theory and experimentation was finally paying off—showing the real-world results of what was mostly theoretical.
Opinions ranged from a fizzled-out dud to an explosion that destroyed the entire world. Talk about high odds.
The point isn’t who won.
The point is that nobody’s bet was, “maybe it’ll kinda be neat.” The options were a revolutionary technology for war, the environment, politics, and the global community—or a dud.
There was no room in between.
And game changers are the same way. They’re either a seismic earthquake that transforms your industry to the core, or they fizzle out. There’s little in between.
