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Tragedy of the newcomers

 
Our rating methodology is based in this paradigm: Tragedy of the newcomers

Every company has to grow, year-over-year, to stay alive in this competitive global market. Key component of growing is increasing the customer base, at least for majority of the companies. More customers bring in more revenue, which translates into better employee morale and innovation within the company.

The day a company stops growing – customer base no longer increasing – it’s the beginning of their end. When this happens, companies often resort to cost cutting measures in order to pander to financial market needs. This cost-cutting initiatives translates into poor employee morale, and innovation takes a seat at the dumpster. This downward cycle is self inflicting and will continue until the company takes bold steps to correct the death spiral. Very few companies have achieved this in the past.

Ask Yourself

When a potential customer, newcomer, encounters your product or service:

  • Why would he/she buy your product?
  • How does your product compare to the competition?
  • How easy it is for the newcomer to switch to your competitor?
  • Finally, why the have to keep coming back for your product/services?

Think!

  • Why Blockbuster failed?
  • How Samsung overtook Sony in the electronics market?
  • How Facebook displaced Myspace to become the biggest social network?