Law #9: The Law of the Opposite

The Law of the Opposite says that the #2 player should generally do the opposite of what the #1 player is doing. If you are #2 in your category, you want to be #1, right? Wrong. You can't choose to be #1, but you can certainly choose to be #3 or #4. The worst thing you can do is to try and beat the #1 player at his own game. Instead, realize that not everyone in the market wants to play that game. Offer those people an alternative. This law is the reason that I humbly assert that Borland's strategy for Delphi is all wrong. For several years, Delphi had been doing a fine job playing Pepsi to Visual Basic's portrayal of Coke. Delphi is a solid #2 in the market for RAD tools. People like Delphi. It's a highly respected tool. But something has gone terribly wrong. When Microsoft zigged, Delphi should have zagged. VB .NET is a huge discontinuous change from Visual Basic 6. Even now, around two years later, some VB developers are still mad. Not everyone wants to move onto the new .NET platform. Some people need to continue developing traditional Win32 applications for quite a while longer. I'm not saying that those angry VB6 people would have moved to Delphi. But the Law of the Opposite still applies here. Borland should have immediately shifted its message to be the opposite of the leader: "Delphi -- the Win32 RAD tool that isn't trying to force you into something you don't want to do." (Yes, yes, I know that Delphi 9 will still have support for native Win32 targets. The point remains: Borland is weakening itself and its message by refusing to focus.) Interestingly, Borland seems to have repeated this mistake throughout their product line. The result is that I can't figure out what market position they are trying to have. Is Borland a .NET company or a Java company? Luckily, although their marketing strategy team is MIA, their marketing communications team has saved the day by coming up with "Excellence Endures". Surely a great tagline will take care of all their problems, eh?

Law #8: The Law of Duality

The Law of Duality says that "in the long run, every market becomes a two-horse race." Young markets have many rungs on the ladder. They are highly fragmented. Gradually, as the market matures, players disappear and the market settles on exactly two primary players. Examples of this phenomenon are everywhere: · Coke and Pepsi · Canon and Nikon · Nike and Reebok · GM and Ford · McDonalds and Burger King It often takes a long time for things to settle down, but in the end, markets usually give people what they want, which is two strong choices. Buyers don't like choosing between ten or twenty players. It's too stressful. A big reason for this effect is that most people don't make their own buying decisions. People tend to buy what somebody else9 is buying. Pragmatists buy something only after they see the Early Adopters buying it. Conservatives buy it only after the Pragmatists are buying it. Laggards buy it only when the peer pressure and ridicule is so severe that they look like absurd for not buying it. Market share begets market share, and the rich get richer. Even as the market gets very mature, it will continue to tolerate the presence of more than two players. However, the top two will have the lion's share of the market. All other players are essentially in niche segments. Once a market reaches this state, it will generally not allow #1 and #2 to move around. For example, the market will never allow the top two players to change positions. Burger King will never be #1. Furthermore, the market will not allow #1 to get too far ahead. Just as markets hate having a ten-horse race, they also hate having a one-horse race. When #1 gets too far ahead of #2, the market will usually correct the problem. 9 http://software.ericsink.com/Act_Your_Age.html The Software Industry At this point, I assume most of my readers are confused. After all, everything I said above makes virtually no sense at all when we look at the software industry. We don't have two strong choices. Most software market segments are a one-horse race. In many cases, Microsoft is so utterly dominant that there is no clear #2. · There is no strong #2 desktop operating system. · There is no strong #2 office suite · There is no strong #2 developer IDE. Why do these markets not follow the Law of Duality? The popular notion today is that Microsoft is an illegal monopoly. I have generally tried to stay out of this debate and I think I will continue to do so. Antitrust law has never made sense to me anyway. But whether or not Microsoft is a violator of government law, it is clearly a violator of the natural laws of marketing. The current situation in software is not supposed to be possible. The market should have ensured the presence of a strong #2, but it has not. Even more strange here is the fact that software is still a rather young industry. At its tender age of perhaps three decades, we should expect to still have very high fragmentation. But we don't. I don't think antitrust law is the answer. It is quite clear that the federal government is no match for Microsoft. But the market itself still has a lot of power. The Law of Duality may yet show up.