Home' Trinidad and Tobago Guardian : May 15th 2014 Contents MAY 2014 • WEEK THREE www.guardian.co.tt BUSINESS GUARDIAN
COMMENTARY | BG13
Winning away busi-
ness from giant
for market posi-
tion can be very
risky for a smaller enterprise, but if you
have the courage and a great idea, it's one
of the most rewarding undertakings an
entrepreneur can embark upon. Your success
won't just involve building a good business,
but will stimulate innovation and encourage
competition, benefitting consumers.
Before you take on a huge company, make
sure that you know exactly what you're up
against. Learn as much as you can about
the sector and how and why your rivals are
able to thrive. Do your market research,
focusing on how your product or service
will be different from other brands' offerings.
After all, if you aren't going to provide some-
thing better, what's the point?
For example, when we launched Virgin
Cola, our decision to compete with Coca-
Cola was described to me as "like having
a bleeding contest with a blood bank." While
our product was good, it wasn't extraordi-
narily superior to Coke's. We performed
well for a while, but once they decided to
put us out of business and flexed their finan-
cial muscle, our sales started dropping.
On the other hand, when we started pro-
moting the high-speed tilting trains that
we had purchased to cut travel times for
passengers on our British rail business Virgin
Trains, it was such an innovative idea that some
people thought we were joking; the railroads were
so old that surely it wasn't possible. But we were
confident that our approach was sound, and it wasn't
long before we had a successful business.
While a truly inventive product or service will go
a long way toward helping you to win the battle,
often that alone isn't enough. Market leaders will
not give up their position without striking back as
hard as they can; they will do whatever is required
to stay on top. The odds will be stacked in their
favour, and they usually have the financial clout to
make things difficult for smaller companies.
This is often the case in aviation. In the '80s, when
we introduced Virgin Atlantic flights from London
to Miami, to challenge Eastern Air Lines, they said
that there was no room for two carriers on that route;
one would disappear. And it wouldn't be Eastern!
There was a price war, and, well, we are still flying
In some industries, your competitors may also
have the assistance of regulations blocking compe-
tition. In such situations, persistence is key. Virgin
America took a while to get off the ground; literally!
The regulations about foreign ownership in the Amer-
ican airline industry are stringent, and we were
grounded for the first couple of years. Rather than
let ourselves get discouraged, we used that time to
build a passionate, energised team and also to perfect
Through our promotions, customers learned how
innovative Virgin America was; from in-flight Wi-
Fi to touchscreen seatback entertainment for every
guest. By the time we were permitted to take off,
customers were eager to fly with us.
Also, when you are taking on a big competitor and
your company is under extreme pressure, it's a good
idea to have a network of mentors you can call on
Look for people who have real-life experience at
similar challenges. When Virgin Atlantic was locked
in battle with British Airways, I sought out Sir Freddie
Laker, whose airline, Laker Airways, had been put
out of business in comparable circumstances. He was
able to give me invaluable guidance on how to handle
our very difficult situation.
Taking on the establishment is never easy, and
you'll need to overcome obstacles at every turn. Nev-
ertheless, you do have some important advantages.
An innovative product or service that offers people
a better way to solve a problem will get their attention.
Once you have won some business away from the
established market players, they will react, but you'll
find that your small company is naturally nimble in
ways that big corporations can't be. You'll have the
flexibility to act speedily as conditions change, rather
than being hindered by a big bureaucracy that is set
in its ways.
If you and your team do decide to tackle your
industry's Goliath, remember to stick together, remain
persistent when faced with obstacles, and to keep
on innovating. And if you win, don't be complacent
- keep on working as a team, persisting and innovating,
because someday, some little company is going to
come along and challenge you.
Head over to Virgin Disruptors,
http://www.virgin.com/disruptors, to join the debate
around under-inspiration, over-regulation and
whether entrepreneurs have lost the will to innovate.
My opinion? Innovation and entrepreneurial spirit
are more important and stronger than ever.
(Richard Branson is the founder of the Virgin
Group and companies such as Virgin Atlantic,
Virgin America, Virgin Mobile and Virgin Active.
He maintains a blog at www.virgin.com/richard-
branson/blog. You can follow him on Twitter at
twitter.com/richardbranson. To learn more about
the Virgin Group: www.virgin.com.)
(Questions from readers will be answered in
future columns. Please send them to RichardBran-
email@example.com. Please include your name, coun-
try, e-mail address and the name of the Web site
or publication where you read the column.)
Taking on Goliath
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