I Was Reminiscing the Other Day And Here’s What I Came Up With…
It struck me that the main reason SGM is successful is not necessarily because of me, but because of. . .
. . . the incompetence of most other site owners, and the rapidly increasing amount of SHIT content being put out on the Internet each day.
You know, stuff like:
- “10 Things Successful People Do Before Bed”
- “Manifest Your Destiny by Finding Your Passion in 3 Simple Steps.”
- “The List of Secret Things That Cool People Never Do.”
- “9 Questions to Ask Your Mom To Annoy Her During PMS.”
- “What Your Dog Wishes You Would Do (Hint: It’s not buying expensive dog food)”
Did I come up with these on the spot just now or did I perhaps copy them from some site?
I guess we’ll never find out.
Clickbait content without any depth whatsoever makes me look good in comparison.
—And it can do the same for you.
In Case You Didn’t Know, Differentiation is the Shit!
These days it pays to be contrarian, personally and professionally.
(…maybe this has always been the case?)
Sometimes the best thing you can do–when others are unoriginal–is to just do something different.
Let me give you 10-something examples of how this simple idea can pay off for you big-time!
1) McDonald’s Monotony Index
The “Monotony Index” was a term Ray Kroc came up with. 1
When McDonald’s looked to expand in new territories, the first thing they did was to try and diagnose where on the Monotony Index it was located. So they took a helicopter and scouted the area for real-estate locations.
First they looked for signs of community, i.e schools, churches, and other large facilities. Then they would get a ground survey of that area.
If they found few restaurants or other recreational facilities to compete for use of leisure existed in the area, they would buy the location and set up a McDonald’s restaurant.
The fewer competitors–direct or indirect–there were, the more the McDonald’s restaurant would stand out and be appreciated.
Hence the more money they would make.
Let’s do another McDonald’s example…
2) Ray Kroc on Building New Stuff
The economy was depressed and many big businesses wanted to lay low. But not Ray Kroc & McD:
Hell’s bells! When times are bad is when you want to build. Why wait for things to pick up so everything will cost you more? If a location is good enough to buy, we want to build on it right away and be in there before the competition. Pump some money and activity into a town, and they’ll remember you for it.
Where most others only saw the downsides and were afraid, Kroc, being a contrarian, saw 4 advantages:
- Profit by contrast.
- Scarcity of demand >> cheap!
- First-mover advantage.
- Gain goodwill.
(Read the quote above carefully and you’ll see all four.)
3) Frederick the Great Takes a Contrarian Stance
One of the reasons that book was disliked is because it’s very pragmatic, and sometimes preaches short-term, egoistic thinking.
Frederick the Great wrote a book called Anti-Machiavel, where he goes over every single chapter from The Prince and challenges the words of Machiavelli.
In one of the better parts of that book, Frederick preaches long-term cooperation over short-sighted back-stabbing:
In policy, one should make a list of all the faults which the other princes show when pressured, for the use of those who want to make treaties or alliances…
It starts off sounding almost like Machiavelli, but then he continues:
…and try to guess at the time when it would be necessary to communicate with them in writing, when they need the time and the calm to make reflections, which could only benefit them. This tends to be better than a railroading, followed by a payback.
This is valuable advice for everyone today.
It reminds me of Henry Flagler’s preemptive maxim of doing unto others as you would have them do to you, only first.
4) A Timeless Strategy: Competing vs Dumb People
This is what professional gamblers and speculators do.
It’s kind of a sad way to make a living, but it works–and always will.
A Swedish stock/finance personality, Claes Hemberg, said that the average owner of Swedish company Fingerprint (the #2 stock to increase in value globally 2015) is a young man with little experience in investing who drastically overestimates his own intelligence. This is probably true.
Those who own the stock are like a cult in the sense that they feel very clever for being the first to “see the truth”.
For this reason, Fingerprint has been the most speculated stock on the Swedish market for over a year.
5) Apple Differentiates From IBM & Dell
Apple was the first software/computer company to do any serious branding.
They realized other big companies were marketing computers only to super-geeks. IBM or Dell, who were the biggest companies selling computers at the time, had no personality. Normal people were scared of the complexity of computers.
Apple went the exact opposite way and decided to make their computers user-friendly and non-geeky.
Regis McKenna, Apple’s marketing expert, said: “Let’s make Steve very high profile. Let’s tell our story.”
20-something years later, most people use Apple products and are happy to pay 2-3x the price of similar products.
6) Rockefeller Center Was Built During the Depression
The Rockefeller Center was the biggest private building project in history at the time (1930). It took 9 years to finish.
Because they built it during the economic depression, labor was extremely cheap. In hindsight, this was a genius move on their part. But during the time it was being built it was a bold and risky move. John Rockefeller Jr. nearly died from the stress.
Maybe Ray Kroc learned by studying this case?
7) Google Goes Minimal
When Google first came around it was different and stood out because it was minimalistic.
It was just a search engine; it had no ads, no mumbo-jumbo, no affiliates, and no ad-on programs.
Google stood out from its competition and beat the hell out of Yahoo and Internet Explorer, who did all of those things. Plus it was easier to use.
Almost everyone uses Google today.
8) Three Entertainment Examples
- Why was the movie Memento popular?
- Why did South Park become a hit?
- What made the Twilight series successful?
They all broke the traditional expectations of their respective genres.
Memento was non-linear (the movie goes backwards).
South Park was extremely outrageous and non-politically correct.
Twilight–which I haven’t read or watched, but know of–is about romantic vampires, whereas the norm is for vampires to be evil. 3
9) Warren Buffett Makes Berkshire Hathaway The Premier Holding Company
I was reading Warren Buffett’s Essays recently.
As you probably know, Warren Buffett is one of the best businessmen alive, and probably in all of history too.
It just so happens that in managing Berkshire, he has done many things that have gone against the grain of the financial industry:
- Other company owners wrote dull (and often dishonest) annual reports; sometimes they didn’t even write them at all, but only put their name on it as a stamp of authenticity. Buffett’s annual reports are personal and honest.
- Other companies treated their shareholders like a faceless mass, Buffett invested into his relationship with shareholders and treated them like fellow partners.
- Other companies split their shares for speculative purposes or because it was trendy; Buffett felt it defeated the purpose of incentivizing “partnership mentality”:
If people bought for no other reason than a stock-split–that had nothing to do with value–then they would sell just as easily.
- While many other big holding companies used what Buffett and Munger referred to as the “Gin-rummy approach” (to keep your best cards and discard your worst cards ASAP), Berkshire kept its sub-par companies. Do you know why? 4
- During the 1980s, there was a prevailing trend of LBO (leveraged buy-outs) on Wall Street. Many companies feared they would get bought up and sold for profit) by “corporate raiders”. Berkshire took a contrarian stance and instead acted as a white knight. For a desperate CEO, selling to Berkshire could be a third route between succumbing to a raider and resorting to self-immolation via greenmail. 5
In summary, Buffett (and Munger) have done everything within their power to incentivize long-term investors with owner-mentality to hold Berkshire.
. . . and–equally important–they have disincentivized short-sighted speculators from ruining their life’s work.
10) How Arnold Got Attention From the Judges By Using a Special-Made Differentiated Posing Strategy
I recently read Arnold’s book The Education of a Bodybuilder.
Now, I already knew that Arnold is a master, but when I read his biography Total Recall, years ago, my framework of mental models was–maximum–10% of what is today. . .
. . . so my pattern recognition could only notice whatever my limited understanding could grasp at the time. Now, when I read Education of a Bodybuilder, I could see clearly that Arnold did just about everything correct.
Here’s a short list, off the top off my head, of some of the “universal success principles” Arnold used to become the best:
- Breaking out of the social conditioning of brain-dead and ambitionless people in his small village, at any cost.
- Getting positive role models early in life and consistently seeking out new masters to learn from.
- Working hard to cultivate a winning mindset and a positive psychology.
- Putting himself in a steady winner effect, and keeping it no matter what.
- Identifying and tracking metrics relevant to his success (taking measurements of his body), so that he couldn’t delude himself whether he was making progress or not.
- Seeking out valid criticism (only) from people he trusted and respected, in an effort to identify & improve on his weaknesses.
- Studying successful people from in and out of his field.
- Analyzing his failures and learning from mistakes.
- Etching his goals firmly in mind through mental rehearsal and visualization.
And, you guessed it…
10) Arnold studied the competition & used clever differentiation:
I also spent time watching other guys pose, watching films of them, especially guys I was going to compete against, to determine their weak points, their strong points. Then, on the day of the contest, I could outpose them. I’d see where they used slow poses, and figure out how I could put in three poses for their one, and thus be able to show many more body parts to the judges. All of this together made me certain I’d win.
Then he wanted to find other ways to gain an upper hand.
I asked myself over and over, “What can you do to be special and different?
He decided that special thing was ballet:
I went to a dancer at UCLA and started taking ballet lessons to further improve my posing…all this helps give grace to your posing routine. And grace is one thing people don’t expect from a big guy like me. That’s why it’s kind of shocking when I’m onstage posing and I move and flow into this smooth, super-graceful catlike routine. It definitely has a positive effect on the judges.
11) Lee Kuan Yew’s Greening of Singapore
I was reading one of LKY’s books recently. Part 2 of the Singapore Story.
See for yourself…
LKY planted trees and green fields all across the road from the airport to the city. This was smart on two levels:
- It stood out from all other Asian countries at the time 6
- It was a clever way to optimize for first impressions on foreign investors and other visitors.
This is SO OBVIOUS.
You would think. But most countries’ governments don’t do it.
When I went to Thailand recently they did indeed have some greenery along the way. But it wasn’t anything spectacular.
12) My Podcast: 25 Minuter
Time for bragging rights.
We recently held a unified championship belt in 4 categories on iTunes New & noteworthy:
[Pictured:“25 Minuter” ranking #1 in All Categories, All, #1 in All Categories, Audio, #1 in Business, and #1 in Education on iTunes New & Noteworthy for Sweden. After 14 weeks.]
–Maybe you don’t care about iTunes, but that’s sort of a big thing.
How is our podcast different?
As the name implies, we (try to) keep our show to 25 minutes, without too much nonsense, instead of 1h+ of empty rants on pointless issues. If you understand Swedish, do give it a listen.
Regardless, here are…
5 Things You Shuld Think About Before You Do Something Radically Different:
- What is the upside of not following the “rules”?
- What’s the worst thing that could happen?
- Would you be comfortable if it was printed on the first page of the paper?
- Could you get hurt by doing it?
- Do you even care?
The Top 2 Times When You WANT to Do it Differently
- When everyone else is doing something monotonously you will stand out by defying the norm.
- When you’re dealing with an outdated or idiotic system/model/set of rules/religions/obsolete laws/old people who’ve stopped adapting.
This is some big stuff. Seriously, it applies to whether you’re:
- In school
- Working in a big company
- Part of some club
- Doing advertising
- Focusing on dating
So just DO it, figure out a way to differentiate what you’re doing!
Over to You:
How can you use these ideas in your own life?
Can you think of some example where someone or something–a person, company, movie, or whatever else you can think of–has differentiated themselves and stood out from the crowd? Favorably or wrongly.
Any example is interesting.
unfortunately he never revealed exactly how they measured it. ↩
Holy shit, this book just costs $1-2 bucks on Kindle on Amazon. Buy it. It’s extremely good, if you have a talent/interest in strategy and high-level thinking. ↩
like in that vampire movie with Tom Cruise and Brad Pitt and Antonio Banderas I watched when I was a kid. It was pretty cool.↩
It’s because they saw it as a long-term investment into their brand. Even if the company didn’t do too well, they still kept it because they wanted to acquire a reputation for being a reliable and helpful company to be acquired by. The plan–I believe (they don’t say it outright, but it makes sense to me)–was that their positive reputation would act as a counter-measure to “institutional imperative,” which is Buffett’s name for breaking homeostasis on a grand scale in organizations. And when a company gets acquired, there’s always going to be fear, worry, and resistance among the employees. ↩
greenmail = a company re-purchases its stocks from the “raider” (unwanted owner) at a price above market rate. This is often a waste of capital ↩
As you can read above, many have now copied. ↩