The Duct Tape Wars


      Bookmark and Share

In an increasingly competitive marketplace, all businesspeople are searching for the elusive key to success. Because econtent professionals understand how to select and deploy information, we have a unique opportunity to take a leadership role in our organizations by working directly with our marketing and sales people to offer compelling content directly to customers, particularly on our external Web sites. Well, look no further for the key: information will unlock success in almost any product category—even in a highly competitive industry where you are beset by larger, better-funded competitors. Information Professionals already possess that magic key; we just need the guts to show our organizations how providing valuable information for our customers will make our products winners in the marketplace.

Consider duct tape—a commodity in which most people don't consider brand. Henkel Consumer Adhesives, maker of Duck Brand duct tape, revolutionized the business by doing something radical in the adhesive industry: competing through information. Henkel's site, www.ducktapeclub.com, provides information about the sticky stuff. How-to information, games, places where consumers can post their own suggestions or comments, and even a section on duct tape fashion. On the site, I picked up a back-to-school hint: "Make a nifty anti-roll pencil by making a little duct tape tab on the end of the pencil." I was also amazed to learn that thirteen miles of red, white, and blue Duck Tape was used to create the world's largest duct tape flag (the size of an NBA basketball court.) It's no surprise that Henkel is a market share leader—they're winning the duct tape wars through information.

If you've looked for a financial advisor, mortgage banker, or stockbroker recently, you were likely overwhelmed with an array of companies competing for your business. In the current era of financial skepticism and declining markets, the business of wealth management has become even more competitive than in the bull markets of the late 1990s. Firms compete to manage your money in many ways, but it looks like the most successful firms understand what they're really selling is information. All businesses are becoming more competitive, and just like the financial industry, the way to compete is to offer your customers better information.

Other ways to lure customers abound in the financial markets. A search for "discount broker" turned up a slew of places competing on price. Other financial firms compete on the quality or speed of trade execution and some even tout the availability of a live person on the other end of telephone. But in a commodity business, like banking and brokerage, information rules the competitive environment. The Merrill Lynch individual investor site at http://askmerrill.ml.com/promises: "Merrill Lynch research has the global breadth and depth to provide you and your financial advisor with the insights and tools you need to make intelligent investment decisions." The other full-service firms also provide a version of quality research and information and as such, the financial industry leads the way in competing through the information they provide. It's fascinating to me that Charles Schwab, the pioneer discount broker, now lets the competition undercut them in price, while they focus on delivering information to compete in a tough marketplace. At www.schwab.com, we learn: "Now, more than ever, investors need to know what to buy and sell. Through Schwab Equity Ratings, our clients have the advantage of objective research to help them make these important decisions." By using information to compete, Schwab has come a long way from their discount price competition roots, but it isn't surprising that this strategy has made them a leader.

Competing through information has made a number of unlikely companies successful. Executives at Amazon understood early in the game that to win, they needed to think like an information provider, not a bookseller. Because they built www.amazon.com as an information site, they've garnered a staggering market share in a relatively short time. Sure, the net result is that Amazon sells books, but to compete, Amazon created an information site that happens to be a bookstore. Amazon hired editorial professionals to create a useful taxonomy of the product they offer so people could navigate the "shelves." They employed reviewers to comment and make suggestions based on interest. And Amazon pioneered the widespread use of customer reviews and ratings within their information community. In short, Amazon built a major business from scratch on information as the differentiator.

Any organization should be able to compete more effectively by offering better information to its customers than its competition. The provision of information to customers is a particularly powerful way to compete and to win.