Here's How You Can KILL The Competition Stone Cold... Without Fail.

Love the strategy. It's what I've done and continue doing.
Also love the "simples" at the end. Reminds me of the "compare the meerkat" campaign..

Putting your competitors out of business is going to require getting in front of your prospects---which requires advertising---which requires money.

It's not that easy. There's plenty of cheap/free SEO info for example and look at the 2k course that just sold.

No need to shoot the messenger - I think LB had a good point and was right to call you on it.

What you did was similar to telling people to make money they just need to have a website and products to sell but forgetting to mention that getting the right traffic to realise that potential is the biggest factor and they'll make nothing without it.

Yes you should have a great product and offer etc..... but getting it in front of people is what it all comes down to - you can sell a bad product without good marketing ( yeah - you'll get a lot of refunds but that's not the point here) - so just saying make a great product and give it away won't work for anyone - without being able to get it in front of people.

You could just add that element to your suggestion rather than trying to argue with the person who spotted that you missed it..

The other issue you have is staying power... Plenty of fish was started in 2001 - I dont know the guy's story as I have no interest in it - but I bet he worked on this site for quite a while before he hit the tipping point - you gotta be able to pay the bills in the meantime...

Guys, my point is that if someone is selling a premium service and you can give it away for free, then you can steal the market share.

The money comes from backend promotions and advertising revenue.

Of course not everyone can do it. Most people won't even try, let alone see it through. That's life, that's human nature.

@Andy - I wasn't arguing, I was just stating that you don't need to pay for advertising to get exposure.

It was just a fast and loose post about ONE way to get into business and fight off competition. Take from it what you will.

Why be cutthroat and ruthless when you can partner and create a syndicate? If you establish a reputation for ruthlessness, you'll never be at the top of anyone's list as a partnering candidate.

Create a compelling, but non-competitive product offering and approach the competitor with a JV offer to let them keep some obscene profit percentage... 75%.... but not 100% because they will start to get suspicious. Anyone offering 100% commission on the front end obviously has ulterior motives. So play it safe and offer a lucrative percentage with the reasoning that you're nobody in the business and just trying to get started.... which is the truth, right?

Create a mad value crazy front-end for the launch for free as a marketing tool for them to use to attract a giant percentage of their list.

Continue to develop segmented products that bring your own angle to the table, but don't necessarily compete directly with their core.

Think in terms of Frank Kern and Jeff Walker. Walker has PLF, right? Kern has Mass Control. They're both sort of similar in the whole pre-selling product launch structure. But Walker's is more about the systematic business process itself. Kern's is about creating a media persona and identity.

By promoting each other, they create momentum and leverage.

Of course, you could take the dark side approach to this strategy and do a deal. Then release a free knockoff version of their exact product.

But guess what?

You've poisoned the well in your market and will never get any partnership deal with anyone. You've shown what you're made of.

Plus, me too products very rarely reach a dominant market share.

Markus was not first to market in his segment. Business history proves over and over that is not the spot you want to be at because your entire marketing strategy is that of trying to compare yourself to the competition instead of leading a sector that you actually create and dominate.

The give away for free strategy is an extreme version of discounting price. So yeah, knock yourself out building a business that gives away the core value for free across the board, and then rely on 3rd party sources of revenue as your primary income.

It doesn't mean that you can't achieve SOME level of success... there are many instances of this including Markus' business. But I wouldn't bet on his company as an institutional investor. No way in hell would I put venture capital into his company. He's at the mercy of ad networks and a whole bunch of other market factors.

The long term survivor isn't usually going to be the "me too" guy playing ruthless discounter of knockoff products.

@Micheal - good points, but no matter which way you look at it, no matter what product you create, you'll always have direct competitors... competitors that you can't JV with because you're going head to head.

Sure, you can create complimentary products to team up with them, but as you elude to, they're gonna be pissed if you turn around and start selling something which directly competes with them.

I know what you mean though - it's a good strategy to approach non-competitive JV partners for your traffic.

But as I say, you'll always have direct competitors to deal with.

I'm not saying undercutting is the safest, easiest or most investable method out there, but I'm just showing how it can be done... and clearly HAS been done to make people VERY rich.

Want another example? OpenOffice.org.

There's plenty more...

I do not know where you got this idea, but if you have been observing someone elses tactics, I am afraid you have missed the point.

It is not about knocking out your competitors, it is about positioning yourself above them by giving more value. You will always have new competitors. BUT if you can give away the equivalent of what they are selling, people will tend to make comparisions and think " If this is what he is giving away, just think how good what he is selling must be!"

Check out Eben Pagan on youtube. If you can change you mindset from "how do I get $1 dollar from a million people" to "How do I give $100 dollars of value to a million people and ask $10 from each in return". Do not worry about competition, they are just there to make you look good.

It's also worth noting that he had a significant advertising budget to get the site off the ground. He did a lot of offline advertising in the early days. Merely being free wasn't enough to get the train rolling. It rarely is.

There is also the issue of him being a software developer that innovated ways to keep his server costs way down.

It's nice to look at people as sources of inspiration, but there is usually more to their stories than meets the eye. This wasn't just "some guy" that everyone here can relate to that hit it big.

[/erase all]

Give more, work harder, and persist for longer.

Edit: too easy :-(

Wow, never really thought about that type of business model. Thanks!

I remembered an example of how this sometimes doesn't work, from this forum a few years ago.

I was getting asked a lot about RSS in 2004/2005 and so I started writing about it in ways that everyone could understand. It naturally led me into doing a lot of blogging and pinging and I ended up writing several books and doing videos on most aspects of it.

I decided that rather than charge people for the blogging related information I'd just share it for free in posts and in ebooks so that there was no reason for anyone not to understand how to do it. Blogging was making me money and I was giving away all of the information for free about how to do it and answering any warriors questions that came up.

Then a product came out that covered some information about blogging. Not nearly as much as I was already giving away for free, but it got heavily promoted and became a CB best seller and is still near the top now and has sold several revisions since and made over $100k.

I was confused at the time because I bought it to see what all the fuss was about and found that it didn't say anything I hadn't already said many times for free in the forums, and it wasn't very well written, but people were coming here and raving about it.

So in that case giving away the information certainly never killed any competition - it just left me wondering why people would go and pay for something they could already get for free.

But that's the IM way - people promote stuff to make a commission and others buy it - it doesn't seem to matter that they can get the same thing for free, often in this forum.

Andy

I love this strategy. It's what I've done and continue doing.You have put an excellent post here to guide us all. I believe in doing so.I am still visiting this site and getting lot of knowledge. Great Post, once again thanks.

The real competitive advantage is offering something your competitor cannot copy. What if the competition starts copying your model and start offering free service?

You can't always give your product away for free, but you can usually find a way to make it better or more appealing to your customers so that you don't have to. If your competitor is stronger than you are, figure out what they do that makes them so successful, and then dedicate your time to doing it better.