
How a startup responds when a giant arrives - jjacobs22
http://runkeeper.com/blog/uncategorized/welcome-nike-thanks-for-coming-part-two
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maxklein
I think people are too afraid of competition. There is no product without a
lot of competition, and suprising as it seems, second best, 3rd best and so on
are still making a hella lot of money.

Take microsoft word - it dominates the word processing market. But there are
many people earning a lot of money selling OTHER word processors.

Competition is irrelevant, and in his particular case, he has a huge advantage
over Nike. He has one product that he is working on, while Nike has a lot of
other things to think about, and this is not important. He can add features
immediately with no approval process. He can do anything he wants without
paying attention to the damage it may have on other parts of the company.

This dude is at a clear advantage over Nike, so very frankly, I don't really
think there is a problem.

~~~
d_r
Couldn't upvote you enough. This also applies to a startup vs. another
startup. There have been a number of "Ask HN:" posts recently along the lines
of "oh shoot, we just discovered there's another startup working on a similar
idea! should we give up?"

If nothing else, seeing that other people are pursuing a similar idea is GREAT
-- it's a confirmation that the market probably exists for it.

~~~
dasil003
_If nothing else, seeing that other people are pursuing a similar idea is
GREAT -- it's a confirmation that the market probably exists for it._

Well I agree that the converse is true—no competitors is definitely a red
flag. But having lots of competitors in the startup space doesn't necessarily
mean there's a market for it, quite often it's just something cool that geeks
are into but may be a small winner-take-all market that's already been won
(eg. Twitter/Facebook clones).

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danilocampos
What a great post.

Software is used by people who want to solve a problem. Big, big companies can
bring connections, brand recognition, money and other intimidating resources,
sure.

In the end, though, people use the software, not the brand. No amount of money
can replace the value of genuinely understanding and serving the needs of the
people who use what you make.

In a software matchup between guys who live and die by their ability to _make
and sell software_ vs. guys who sell rubber and plastic sewn together in
sweatshops, you can call the winner before you even see the fight. My hat is
off to Jason for understanding the value of his company's position.

~~~
patio11
It is even better than that. Nike's core competence isn't shoes, it is
marketing an image of sportsmen as an attractive lifestyle. If you make
something for that lifestyle, their core competence is marketing _you_. That
is why sales doubled: "serious sportsmen use software" blasted out of their
megaphone makes sports software as a category instantly more valuable.

~~~
cullenking
This is precisely why I enjoyed hearing our main competitor received $5
million in a series A. It instantly validated the market, and it will do
nothing but create opportunities for us.

Since our software is fitness tracking, that same good news applies to
RunKeeper as well! MapMyFitness, no matter how much money they get, won't be
able to keepup with small, agile development teams like FitnessKeeper,
ridewithgps, CycleMeter etc.

~~~
eru
At least not in all niches.

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carbocation
The author shows insight. The key thing that he realized is that for Nike,
etc, run-tracking apps seem to be treated as branding tools to help them sell
more shoes. In essence, his company is getting free advertising via Nike's
ads. As they sell more of their pedometer hardware, he gets new potential
customers.

Likewise, this special circumstance makes it a bit difficult to extrapolate
from his success to another situation. If the giant arrives and actually
intends to wrest control of the segment from you and profit from it _per se_ ,
the situation will play out differently.

~~~
mikeryan
I really appreciate the plucky nature of this post, but I'm really not holding
my breath.

Right now the Nike app is $2.99 and number one in the Healthcare & Fitness
section - Runkeeper is $9.99 and ranked 24th.

Yes - Nike really wants to sell shoes, but _they really want to sell shoes_
this app can be a loss leader for them, they don't need to really show a
profit - heck if it breaks even they're fine. You really don't want to compete
with someone like Nike with an app where they _don't need to make a profit_.
Heck he mentions that they're 14th (actually 13th now) and Addidas is 18th in
the section, but thats the free apps section. Again Addidas doesn't need to
make a profit with their product when they are really making their money on
shoes.

As far as I can tell runkeeper is just an app? eek.

~~~
patio11
Why compete via the bestseller list when you can compete with your previous
sales records? They doubled sales! Who cares if Nike sold more? McDonalds sold
more coffee yesterday than every Startup here put together has paying
customers, but that doesn't make anyone less successful.

~~~
mikeryan
Did their "sales" double? or their users/downloads? The author likes to
conflate downloads of their free app and their paid app. I went back and
looked at the previous post - when their "numbers" doubled. Then they moved
from 11 to 8 in the store, now they're at 13.

Now that Nike has a directly competing product at 1/3 the price I want to see
the follow up post with _revenue_ numbers after Nike's app has been in the
store for more then a day.

~~~
dasil003
I see no reason to believe their conversion rate would change. If it did that
would be a nice disclosure, but why are you seemingly so offended by an
optimistic entrepreneur? Is there any other way to win?

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chrischen
Wow. They practically just described exactly what happend to me in the last
few days of the Ping launch (albeit on a smaller scale).

When Ping launched I had a 3-month long solo developed music app that NO ONE
knew about. I thought surely, I'm screwed, especially since Ping was almost
identical to my app (Like.fm) when it was announced.

Thankfully the hype and the underwhelming Ping launch got people to think
about what such a service done right should look like. Next thing I know I've
actually got users :).

And like Nike apple is just focused on boosting value to its store, and
selling more songs. But I can integrate with everyone, not just iTunes, and
deliver the product true to its purpose (and not some corporate ulterior
motive).

Thanks Apple! I might even buy one of your Apple TVs to help you guys out too.

~~~
dchs
<http://twitter.com/#search?q=ping%20like.fm>

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10ren
very recent mixergy interview with their founder:
<http://mixergy.com/runkeeper-jason-jacobs-interview/>

HN: <http://news.ycombinator.com/item?id=1641802>

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philiphodgen
I am voting for runkeeper.com for the win. I have a Forerunner GPS thingy in a
drawer and use Runkeeper exclusively. Why would I buy yet another electronic
thingy from Adidas or Nike or anyone else?

And why would I use one of the big guys' apps? They have ulterior motives and
designs on my wallet and I can smell it. I'll stay away.

Go Jason.

~~~
cullenking
You should try using the forerunner with our site, <http://ridewithgps.com> \-
runkeeper, cyclemeter and the rest are definitely cool, but if you have a nice
GPS watch you can avoid having to carry your phone. Though, if you like
carrying your phone on runs then heck yeah, use runkeeper/cyclemeter/whatever
app and sell the forerunner. Oh, and bug whatever mobile app to allow
uploading to our service! There is lots of room for cooperation in the mobile
fitness market, and I am excited to see how it all develops.

I say that

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Volscio
Great response. You can see how much Nike (and maybe Apple) cares by reading
the web site for the Nike+. Their support forum goes seemingly unread, bugs
and problems remain unfixed, their API cryptically changes, etc., leaving
users to their own devices.

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julianz
Nice post. I haven't used Runkeeper on iPhone, but on Android is "big and
slow-moving" just as he says Nike is. Endomondo on the other hand is small and
fast and seems to do all the same stuff. Interesting market segment to be in,
I'm sure we haven't seen the last of the good ideas here.

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credo
Great to read the story and interesting lesson about competing with giants.I'm
a bit puzzled about one part of the post

 _> >Then, in June 2009, Nike finally did show up, coming pre-installed on
every iPhone & iPod Touch. Unfair advantage, right?_

afaik the Nike app was not pre-installed (by Apple or AT&T) on any iPhone. Am
I mistaken on the facts or did I misinterpret the post ?

 _[edit] Thanks Maxawaytoolong, this is interesting. I'm a little disappointed
that Apple did the pre-installation. However, I'm assuming that the pre-
installation didn't help Nike too much, because most people wouldn't have
discovered the setting and Nike's ads would have equally effective without any
pre-installation_

~~~
maxawaytoolong
It's there, but is hidden until enabled in Settings.

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pedalpete
Something else that might not be considered when thinking about the pace of
change at a company like nike is that it is possible if not likely that Nike
is not developing their own apps, but is outsourcing this to a third party.

That means that it is likely that the app is developed and shipped, and then
reviewed on a semi-annual or annual basis.

Runkeeper can keep churning out improvements and new features, while I doubt
Nike or Adidas will keep up.

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westi
I really admire the way Jason and the team have taken on this problem space.

They react well to customer feedback and it has been a great experience to
watch them grow as a user.

I look forward to the next innovations from the team.

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niccolop
Thank you for writing this - I'm facing a similar situation and I think you
are absolutely right. Understand users needs, but also try and develop as
quickly as possible.

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mahmud
Give 'em hell, Jason!

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expertcs
This is good for now, but, I wont be surprised if they start generating leads
and doing affiliate marketing for shoes/apparel.

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dsantos
i've been using RK for a while.

RK pro is ranked #24 in healthcare category, which is impressive for a $9.99
app. nike+ gps is #3 top chart and #1 healthcare.

i think your "part 3" article will be very interesting :)

