Short term profit or long term goodwill?
The Six Percent Entrepreneur
Short term profit or long term goodwill?
March 10, 2021
In this episode we discuss the only value proposition a company has in a world that is commoditizing.
There is a fundamental shift that's happening in the business world. What's happening is the time it takes for copycats to come to market is slowly decreasing because it's easier and easier to develop products. Venture building is becoming democratized, and as soon as you come up with a product or service and put it on the market, you are going to have 10 copycats almost the very next day. If you have any type of product, you will have a copycat on Alibaba pretty much the next day, like it's pretty much guaranteed at that point. 

So as this phenomenon keeps happening, what happens is the entire world is commoditizing. And when the entire world is commoditized ng, the only value proposition that a company has left is its brand story and its connection with its users. It's a community, and if the brand doesn't take care of that community, that community doesn't have to be loyal to your brand. Once you lose that connection with your community, that community can jump to any other service or product in a heartbeat because there are so many service offerings out there. So this is why it's so important to be in tune with your community and really take care of your community instead of putting profits over your community. 

Once you start thinking in terms of how do I take care of my community, your community will start taking care of you, and those profits will come. But as soon as you start thinking, how can I extract profits from my community and the community gets a whiff of this and they start feeling that they're being manipulated or that they're being used and you're not really there to support the community? Then they will turn on you and the community that's been so strong for you to actually develop like that, that support that was so critical for your first level of development you're going to lose it. Your your community is going to jump ship, they're going to go to your competitors, and you were going to be left in the dust, and for you to actually even start back within that same industry is going to be way more tougher than you just moving on to a different industry and starting all over.

So when you are going vertical, make sure that you are putting community first before profits, and eventually, the profits will come. I am liking these fundamental changes happening because I think what we will see is an emergence of more value creation instead of value extraction, where people are developing things to add more value to a community, and they're trying to attract a community through value creation instead of pissing people off with value extraction. I hope that helps. I will see you guys in the next episode. 

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