Yesterday, I read a bitter blog post by the CEO of the company Smartcar.
Smartcar is a small, 20-person company developing software that allows app developers to connect to smart cars.
And it looks like Smartcar (the company) has just been screwed. That’s because a bigger, better-funded company called Otonomo has apparently cloned Smartcar’s product, down to the API documentation.
And that’s what the CEO of Smartcar was railing against yesterday. He said Otonomo’s actions are illegal, wrong, and a rip-off.
To which I say, cry me a river. What did your expect would happen if your product started to show promise?
I personally think there are a couple of lessons in here.
First, it’s a good idea to learn about basic business principles rather than blindly following your passion and hoping this will carry the day.
For example, Warren Buffett, billionaire investor and currently the third wealthiest person in the world, has long talked about his castle-and-moat approach to investing. Says Buffett:
“We’re trying to find a business with a wide and long-lasting moat around it, protecting a terrific economic castle, with an honest lord in charge of the castle.”
I don’t know about Smartcar’s economic castle and the honesty of their lord, but they clearly didn’t have an adequate moat.
Not a surprise, because as Buffett says, “most moats aren’t worth a damn.”
So what makes a good moat? Buffett gives a few categories (the specific examples below are mine):
Being the low-cost producer (Walmart)…
Having an unassailable natural franchise (VMware)…
Having a clear technological advantage (Google)…
Occupying a strong position in the consumer’s mind (Apple).
Hopefully you’ve already one or more of these in place to protect your business.
And if you want to make your moat deeper, wider, and filled with hungry crocodiles, here’s how to occupy a stronger place in your consumer’s mind — without being Apple.
The key is to inform your consumers about all the great stuff your product or service will do for them…
To inform them frequently…
And to do it in a way where they still enjoy hearing from you, rather than being worn out by the constant thud of the selling hammer.
If that’s what you want to do, I’ve got two resources that might help.
The first is a list of 12 books, blogs, and courses on copywriting and marketing — which I personally found most useful when I was starting out.
The second is my own daily emails on marketing and copywriting.
Conveniently, you can get both resources with one simple action. And that’s by signing up with your email at the link below: