In the Karate Kid, Mr. Miyagi once told his student Daniel, “Walk on road. Walk right side, safe. Walk left side, safe. Walk middle, sooner or later [makes squish gesture] get the squish, just like grape.”[audio:miyagi.mp3] to listen to Miyagi, press play
This fits nicely with my perspectives on innovating in tough times. In my previous blog entries on how to make your products/services more affordable and accessible, I discuss why the middle of the bell curve is a dangerous place to be in these economic times.
I was just speaking with a client of mine and we had the same conversation.
His Fortune 50 company offers a commodity item, but is considered to be a premium brand. They are never first to cut the price of their items (and they rarely cut prices), but they typically lead the charge in price increases. Their brand is associated with high quality and high performance. They are often focused on the right-hand side of the bell curve. They have been doing exceptionally well.
Their competitors fall into two categories.
Some are white label, low price producers. Budget brands. They provide a lower quality product that appeals to those with the least to spend. These companies are in the left-hand side of the bell curve. They seem to be doing particularly well now that people are looking for bargains.
Other competitors are in the middle of the bell curve. They provide good product at a good price. How are they going? These companies are being “squished” by the low cost providers on one side and the premium brands on the other. They are struggling. My client wonders how many of these companies will survive.
The middle of the bell curve is a dangerous place to be these days. If you aren’t careful, you might just get squished like a grape.