You’re probably familiar with the KISS principle - Keep It Simple Stupid - or some similar variation. For the most part, I agree and try to follow that concept. Too many people fail or at least don’t succeed to the highest degree possible because they over-complicate simple things. They’ll spend a year researching a market and creating a product when all that and much more could have been done in a week or two.
But while it’s a good idea to keep things simple, there are situations where simple is stupid. Some online business are good examples. If your business is too simple, it’s easy for someone to copy your business model and wipe out your business; especially if they improve on your business model and do it better. It happens all the time and with all the tools available to spy on your online competitors, simple might be stupid. The exception being if you have some other competitive advantage that can’t easily be copied such as being a celebrity.
A complex business model can be a competitive advantage that makes it difficult for others to copy what you’re doing and keeps your business profitable for the long haul. One example of a complicated business model would be having a maze of front-end products with all kinds of upsells, cross-sells, & back-ends and using several different methods to drive traffic to your sites including offline advertising.
If all you’re doing is using PPC to drive traffic to a site selling an ebook with no back-end, it’s not difficult for smart marketers to use tools to figure out what keywords you’re using and copy your business if they see you’re making money. And if your competitors add a back-end and also test & track to improve their conversion rates over time while you don’t, the marketer who copied your business model might just drive you out of business.
There’s nothing illegal, immoral, or wrong about somebody driving your simple website out of business. That’s the way capitalism works. There are lots of examples of big companies who took their eye off the ball and paid the price. Google was not the first search engine. Wal-Mart was not the first superstore. Wal-Mart didn’t even exist when I was a kid (at least not in the Midwest). We shopped and K-Mart and wore Converse sneakers. K-Mart and Converse got fat, happy, and lazy which gave Wal-Mart & Nike the opportunity to come in and kick their butts. It could be a fatal mistake to think the same couldn’t happen to your business too.
I remember a popular marketer telling a story of how he saw a business model he liked. He ordered the product and thought he understood their business model so he started a similar business and lost his shirt. It turns out the business model was more complicated than he realized. The other company was losing money on the front-end to acquire customers and making it’s profits on the back-end. That’s not an overly complicated business model but it is a good example of how adding some complexity prevented at least one person from taking away some of their market share and that’s the point.
Tags: Testing & Tracking, Article Marketing
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5 Comments
Seeing as this is one of my favorite blogs, I just had to chime in.
Growing up in KMart’s backyard here in SE Michigan we had an up close and personal experience with KMart’s demise. They might have been fat, happy and lazy at one time, but that was a very long time ago; at least 35 years.
The Blue Light’s decline was long, slow, and consistent. Along the way there were many, many internal reorganization plans proposed and implemented. And all of them failed.
And for some time WalMart wasn’t even in direct physical competition with KMart. In its early growth phases WalMart shunned major urban and suburban markets for America’s hinterlands, where land was cheap and competition weak.
By the time WalMart came to the cities KMart was already in the throes of death.
Heck, KMart was so badly run that I often think that it really didn’t matter WHO the competition was. The majority of its’ wounds were self-inflicted.
[Dave,
Thanks for the comment. Glad you like the blog. There was a K-Mart in the small town I grew up in (Valparaiso, IN) which I think is still open but I'm not certain. Wal-Mart came to town a few years ago so whenever I'm visiting I just go to Wal-Mart. I didn't give my example as much thought as you did but you're probably right.
Robert]
This is a topic I’ve thought about a lot. Simple is good when you’re making a sale to a customer; but simple is bad if you don’t want to get knocked off.
I’ve considered the whole idea of having a complex business model in my own copywriting business.
Of course, nobody can be me, so that’s one advantage right there. But there are other things I’ve done so as to be less duplicatable.
Albert Einstein had this opinion on simplicity:
“Everything should be made as simple as possible, but not simpler.”
[Andrew,
That makes sense...I think but I'm not exactly sure what it means. After all, I'm no Einstein. Don't overthink things?
Robert]
Hi Robert
I abide by the K.I.S.S. principle and have a slightly different look at this: I don’t think that even if your business model is ’simple’ you have to be afraid it is copied easily. Expertise in the area of your trade, supplying spectacular customer service only you can do is hard to ’simply’ copy as a model no matter how simple your business model ’seems’.
Karin H. (Keep It Simple Sweetheart, specially in business)
[Karin,
Good point. I also made that same point in the article.
"...simple might be stupid. The exception being if you have some other competitive advantage that can’t easily be copied..."
That would include things such as expertise and spectacular customer service.
Robert]
I think the subject matter of discussion calls if the KISS rule should be applied or not. As they say, different strokes for different folks
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