Entrepreneur
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Don’t Be First, Be Second

By Miles Burke

I spend much of my life seeing new products and services online. What I’ve noticed many times is the “me too” creation of similar businesses – such as the amount of daily deals sites currently popping up.

You may roll your eyes and think that the old saying “First past the post” rings true for all successful online ventures, but it’s not. There are dozens of examples and hundreds, if not thousands, of businesses who made their success through improving on an existing idea.

I might be visiting New York next month. That’s when I found the great spare room rental website, AirBnB. This site basically allows introduction of people with spare rooms with people who are travelling. I was looking through the site, and it reminded me of another service I saw quite a while ago, Couch Surfing.

Turns out the founders of AirBnB, with a value of one billion dollars, were inspired by the now lesser-known Couch Surfing, as discussed in this blog post by someone close to the company, Andrew Parker. AirBnB costs money, Couch Surfing doesn’t, yet AirBnB has huge interest and a skyward value, where Couch Surfing doesn’t.

We’ve seen it with Amazon recently buying the more recently started and quickly growing competitor, The Book Depository. Nobody would believe that iTunes was the first music sales service, or Google was the first search engine.

These are some of the great reasons why being second to market is often better.

Research costs saved. The first to market have spent the money in researching demand. This means you donít have to – if the first to market is gaining success and popularity, then there’s likely demand for your product or service too.

Save the marketing budget. Marketing costs money. If you are introducing a new idea, it can be more expensive. If the company before you has already been out there doing the initial consumer education work, then you spend less time having to educate people yourself.

You learn from others’ mistakes. Sure, we all make mistakes too; however learning from others’ mistakes is cheaper. Buy their product, or subscribe to their service, and then tear it apart – what works with it, and more importantly, what makes it harder to buy or use? Don’t make those mistakes.

Improve on their idea. Watch how they are pitching the concept, and find a better way to do it, or a better niche; even subtle differences can have a large impact on your success.

Believe me, I’m not suggesting you should be copying ideas, however if you find yourself building a product or service, and before it goes live, you hear someone else has beaten you to the gate, don’t be despondent. Being second to market can be a great strategy.

  • Anonymous

    I don’t really know AirBnB, but I know CouchSurfing and I think they’re sth totally different – CouchSurfing, as implied by name, is not even room rental service. When you get in touch with somebody in CS you will get a couch or maybe even a place on the floor. CS is more hippie, bohemian kind of place, where the more important thing is to get know new interesting people in new place than just to have good night sleep. I don’t know business side, but CS has surely enormous devoted community of users (at least in Europe it’s very very popular, almost everybody I know knows this portal and large percentage used it either by hosting or getting a place during travel).

  • sebastian.

    I get the point of the article but like chodorowicz said, AirBnB and CouchSurfing are very different and can’t be compared.

    AirBnB is driven by money. CouchSurfing is driven by the community. The people who created and use CouchSurfing are not there to make money, they are there to meet people and exchange cultures. The more CouchSurfing is growing the more people are signing up thinking of it as simply a free place to sleep which is wrong. Because of that I’m glad there’s no real marketing done and people hear about it mostly by word of mouth.

    AirBnB may have huge financial interest and value, but CouchSurfing has huge personal/cultural interest and value.

  • http://www.sitepoint.com/author/john-tabita/ John Tabita

    Great post. Reminds me of the saying, “The pioneers are the ones who wind up with all the arrows in their backs.”

  • Anonymous

    By the way, I just paîd $21.87 for an îPad 2-64GB and my boyfriend loves his Panasonîc Lumîx GF 1 Camera that we got for $38.76 there arriving tomorrow by UPS.I will never pay such expensive retail prices in stores again. Especially when I also sold a 40 inch LED TV to my boss for $657 which only cost me $62.81 to buy.
    Here is the website we use to get it all from, http://BidsFirst.Com

  • http://pulse.yahoo.com/_WTOMCT663SEUZU35VZNM52Q4SY Marquita Brown

    ll make mistakes too; however learning from others’ mistakes is cheaper. Buy their product, or subscribe to their service, and then tear it apart – what works with it, and more importantly, what makes it harder to buy or u

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