

Did The 900-Pound Gorilla Just Vanquish Your Startup Or Validate It? - dshah
http://onstartups.com/tabid/3339/bid/105249/Did-The-900-Pound-Gorilla-Just-Vanquish-Your-Startup-Or-Validate-It.aspx

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bane
It usually validates the existence of the market, but not which part you play
in it.

My last business was in a market with two very well funded, very large
competitors. But they were only interested in the larger deal sizes, leaving
lots of smaller customers completely underserved. After burning through a
couple rounds trying to go toe-to-toe, we refocused on these smaller customers
with new messaging, sales approaches and product and immediately had the
biggest year we had ever had to date.

One of the other things we did with product was to try to bring capabilities
only the big guys had, but in a cost efficient way to the smaller customer.
This gave them an opportunity to compete on a bigger stage.

We were also able to convert some small customers into bigger customers as
they grew. Having a long history with them kept us onboard with them and kept
the bigger players out.

In anything, when there are only big players involved, there are always gaps
that can be filled. It's why, despite there being Bing and Google, there's
still domain specific search engines, or despite there being Sony, Microsoft
and Nintendo, there's still space for companies like Hyperkin, Valve or Ouya
to have a go.

~~~
phreanix
The quote below is sooo relevant to me. It's what sidetracked me at my
previous startup, getting caught up with what my competition was doing. I know
better now. Listen to your customers. Iterate in THEIR direction. All else
will fall into place.

>This is the most important takeaway. Sitting here a few weeks since Google’s
launch, I can tell you with absolute certainty that nothing has actually
changed. Looking back at the 6 years we’ve spent building BuySellAds, it’s
clear that any time we spent thinking, researching, or reacting to our would-
be competitors was a complete waste of time. In fact, there’s no better way to
waste time than to think about (or even follow) what your competitors are
doing. The only thing that truly matters are YOUR customers. I can’t tell you
how hard it has been to get this engrained into my mind. It is by far the most
important thing in building a business (to focus on your customers), yet so
hard to practice when you see other activity and the glorious tech-headline
touting presumed (or actual) success. They call it “customer driven
development” not “competitor driven development” for a reason.

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Jun8
I've always thought that it was the _800_ -pound gorilla, so I thought that
the OP just made a mistake, but no, the 900-pound gorilla is a thing: an
article ([http://articles.chicagotribune.com/2011-01-05/features/ct-
tr...](http://articles.chicagotribune.com/2011-01-05/features/ct-tribu-words-
work-gorilla-20110105_1_gorilla-idiom-elephant)) in Chicago Tribune talking
about the origins of the 800PG phrase has this:

Sometimes the gorilla surpasses a mere 800 pounds. ("Whose the 900-pound
gorilla now?" asked a headline on a recent tech story about Facebook
overtaking Google as the biggest web site in 2010. Sometimes the gorilla sheds
a few hundred pounds. ( Colorado's governor-elect was quoted last month
calling the state's billion-dollar shortfall "the 600-pound gorilla.")

For some reason, the 900PG is common in tech posts, this may be due to the
effect of a rock band with that name. We may be witnessing a the emergence of
a differentiation like the _soda_ / _pop_ one.

~~~
dshah
Wow. I had no idea. Though I'm not the author of the article, I came with the
title. I didn't even know there was such a thing as an "800 pound gorilla".

Thanks for pointing this out. Learn something new every day.

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ChuckMcM
Nice story. I've added to to my collection of articles that validates the view
that Google is in a world of hurt with respect to meeting growth expectations
with their Ad business. We've seen a continual (now 10 out of 12 quarters)
fall of CPC, we've seen rapid expansion of "inventory" (additional ads on
Google properties, and additional properties) and now we're seeing pressure on
the Ad buy/sell markets directly.

I'm curiously waiting to see when that lands them in court (they are checking
the boxes for monopoly, and abuse of same, as far as I can tell.) Microsoft
got away with it for a long time, but eventually it whacked them hard. So when
the Internet advertising space is artificially constrained by Google using its
position in the space to control pricing or competition, I expect there will
be legal action at that point as well.

~~~
toddynho
There was a time last year when they banned us (BuySellAds) from advertising
on AdWords. I doubt that it was any sort of intentional target toward us;
however, it seemed rather convenient to ban us for having customer
testimonials where our users spoke of earning more money through BuySellAds
than through AdSense.

It took me a while (month or so) and dozens of emails to get our AdWords
account un-banned by them, all while using the AdSense landing page to show
the contrast of the language they use to advertise their OWN products and how
it was much more aggressive than the language we use (through customer
testimonials) to advertise our product.

We didn't read too much into it though, as I suspect they had better things to
do than strong-arm a (comparatively speaking) super-tiny competitor.

Edit: spelling mistake

------
bluedino
>> The truth is that if Google actually wants to compete with your business,
there is a decent chance you will lose. Google wins everything.

Says who?

People used to say the same thing about Microsoft.

~~~
mgkimsal
I think it used to be true about Microsoft as well. The adage doesn't hold
forever, but we're in a time right now where Google being in a particular
arena will tend to be more of a competitive beast than a market validator (it
can be both, but it'll be perceived more as competitor). This might change
again in a few years, but right now Google is a beast. MS used to be. The
question might be do you have enough patience/money/runway to wait out that
market shift to where you can be competitive again, assuming Google is in your
market (many people couldn't outlast MS back in the 90s).

