If you want to grow big, you have to beat the biggies!

Business success stories always inspire us. There are various types : the rags to riches story, the ones involving outsmarting and outmaneuvering competition, the exceptional in execution story, the stories involving how one went bust before springing back up – all of them are quite inspiring and at the same time fun to re-visit. The ones that tops the list for me are the ones who outmaneuvered and outsmarted the biggies in a head on competition. Compiling a list of few of the most amazing stories:

The Dow Story

Herbert Dow founded Dow Chemical in Midland, Michigan when he invented a way to produce bromine cheaply. He sold the chemical for industrial purposes all over the US for 36 cents per pound at the turn of the 20th century. He couldn’t go overseas, however, because the international market was controlled by a giant German chemical cartel that sold it at a fixed price of 49 cents per pound. It was understood that the Germans would stay out of the US market so long as Dow and the other American suppliers stayed within its borders.

Eventually Dow’s business was in trouble and he had to expand. He took his bromine to England and easily beat the cartel’s fixed price of 49 cents per pound. Things were okay for a while until a German visitor came to Michigan and threatened Dow that he had to cease and desist. Dow didn’t like being told what to do and told the cartel to get lost.

Shortly thereafter German bromine started appearing for sale in the US for 15 cents per pound, way below Dow’s price. The cartel flooded the US market, offering the chemical way below their own costs, intending to drive Dow out of business. But Dow outsmarted them. He stopped selling in the US market entirely and instead arranged for someone to secretly start buying up all the German bromine he could get his hands on. Dow repackaged it as his own product, shipped it to Europe, and made it widely available (even in Germany) at 27 cents per pound. The Germans were wondering 1) why wasn’t Dow out of business and 2) why was there suddenly such demand for bromine in the US??

The cartel lowered its price to 12 cents and then 10 cents. Dow just kept buying more and more, gaining huge market share in Europe. Finally the Germans caught on and had to lower their prices at home. Dow had broken the German chemical monopoly and expanded his business greatly. And customers got a wider range of places to buy bromine at lower prices.

Dow went on to do the same trick to the German dye and magnesium monopolies. This is now the textbook way to deal with predatory price cutting.

Source: Herbert Dow, the Monopoly Breaker

Rafael Tudela’s Business Empire:

Rafel Tudela is a Venezuelan oil and shipping businessman. He is the quintessential street-smart executive.

He has built a billion-dollar business from scratch in less than twenty years. He seldom deals in written contracts because his word is his bond. He has always made his own breaks. And his principal business, which is oil speculation, relies on his constant process of seeing opportunities where no one else does and taking advantage of them.

In other words, Rafael Tudela is a genius at taking the edge. One of the best illustrations of this –of how he has the facts, knows what people want, and figures out a way to give it to them- is the story of how he got in the oil business in the first place.

In the mid 1960s, Tudela owned a glass manufacturing company in Caracas, but, a petroleum engineer by training, he longed to be in the oil business. When he learned from a business associate that Argentina was about to be in the market for a $20 million dollar supply of butane gas, he went there to see if he could secure the contract. “If I could get the contract,” he told me, “then I`d start to worry about where I`d get the butane.”

When he – a glass manufacturer operating alone with no previous connections or experience in the oil  business – got to Argentina, he discovered his competition was formidable: British Petroleum and Shell
Oil.

But feeling around a little bit he also discovered something else: Argentina had an oversupply of beef which they were desperately trying to sell. By knowing this one fact –his first “edge,” so to speak- he
became at least an equal to Shell and BP. “If you will buy $20 million of butane from me,” he told the Argentine government, “I will buy $20 million of beef from you.” Argentina gave him the contract contingent upon his buying the beef.

Tudela then flew to Spain, where a major shipyard was about to close down from lack of work. It was a political hot potato and an extremely sensitive issue for the Spanish government. “If you will buy $20 million of beef from me,” he told them, “I will build a $20 million supertanker in your shipyard.” The Spanish were ecstatic and delivered a message to Argentina through their ambassador there that Rafael Tudela`s $20 million of beef should be sent directly to Spain. Once again he had found the edge and taken it.

Tudela`s final stop was in Philadelphia at the Sun Oil Company. “If you will charter my $20 million supertanker, which is being built in Spain,” he told them, “I will buy $20 million of butane gas from you.”

Sun Oil agreed, and Rafael Tudela fulfilled his desire to get in the gas and oil business.

Excerpt from the book: “What they don’t teach you at Harvard Business School.”

ASUS’s Story:

Dell computer used to outsource the manufacturing of their motherboards to a Taiwanese company.

Then, one day that little company presented Dell with a new offer: they could start assembling whole computers for Dell. For Dell, this meant higher profitability: they’d have the same revenue, but with a lower cost base. For some reason the Taiwanese didn’t seem to care as much about profitability, only cash. But that’s probably because they’re still a bit backwards in Asia and don’t have any Harvard Business School-educated MBAs to teach them otherwise.

Anyway, that arrangement worked out well. One day the company came back to Dell with a new offer: they could take over Dell’s entire supply chain. For Dell, that meant even lower costs, and so even better profitability. After that arrangement was put into practice the company came back to Dell and offered to start designing computers for them. Brilliant! Dell could now focus on its core competency,branding, and let the Taiwanese do all the unglamorous work of actually building the damn things.

After that arrangement was put into practice the company took another trip to the US, but this time they didn’t visit Dell. They went to Best Buy, and offered them PCs that were as good as Dell’s but at a significant discount.

Softsoap and it’s acquisition by Colgate

“Back in the 1970s, liquid hand soap was sold by one guy: Robert Taylor, and his small company Minnetonka.  It was his invention, and he knew he was on to something big. Test  audiences loved the product and, despite barely having enough resources  to do so, Minnetonka decided to go all in and make a push to take the  product nationwide.

There was only one problem: Nothing he was selling could be patented.  The concept of liquid soap wasn’t new, and simple pumps had been around  since the dawn of civilization. As a result, Taylor knew several huge  soap manufacturers were ready to happily steal his idea the very moment  it looked like it could succeed on a large scale. Armed with superior  resources and the ability to quickly R&D an imitation product, the  industry giants were ready to crush tiny Minnetonka.

Taylor, however, was ready for this. Before any other company had the  chance, Taylor decided to go shopping one day and bought a few plastic  pumps. And by a few we mean FUCKING ALL OF THEM. There were only two  companies nationwide manufacturing those little pumps, and Taylor ponied  up $12 million — more than the total net worth of his company at the  time — and ordered 100 million of them,  effectively buying every single pump these two companies would be able  to manufacture for the next year or two.

Anyway, without the part required to dispense the soap, there was  nothing the major companies could do but sit and watch Taylor slowly own  the entire market. His product would become known as SoftSoap, Two years after his little stunt, Colgate-Palmolive  would be forced to just buy SoftSoap from Taylor for $61 million.”

Reference : http://en.wikipedia.org/wiki/Softsoap

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~Inspired by this thread on Quora

One of the best yet often underestimated source of online traffic: Understanding Traffic from Stumbleupon

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As an online marketer we should really consider ourselves blessed with the amount of effective and virtually no spend marketing channels we have to sell almost anything. Just consider the few listed in the figure below.

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But it’s also important to understand that it’s so very easy to lose focus and half heartedly use a number of these channels for virtually no results.

Let’s check the major sources of traffic under each of Social Network, Social Bookmarking and Media Referrers.

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Source : Readwrite.com

The three graphs do show the importance of using Facebook, Twitter, Youtube and Stumble upon as the major channels for getting online traffic. The referral traffic from Stumble Upon has gone down in the past year or two and Pinterest has gained prominence. People might also argue that the traffic from Stumble Upon hardly converts. But even then the traffic that Stumble Upon can generate is significant enough. So create quality content and you can trust on the Stumblers to recommend you and bring you tons of traffic.

I love this website.  It’s a pretty simple site but the content is exactly the type Social Media loves. I’m sure the site gets insane amounts of Social media traffic. So if your website has content that can get pretty viral : Images, funny things, cool gadgets, celebrity news, nature and wildlife related, food and beverages related or basically anything that’s a good read and time pass, then Stumble Upon is a must for you.

Now let’s look at what Stumble Upon is and some of the key things you could do to boost up your traffic from Stumbleupon.

Stumble Upon is a social bookmarking site. Stumblers can bookmark great pages and websites they find on the web and categorize them accordingly. One can also install the Stumble Upon browser plugin on the web browser that makes it easy to bookmark their finds or to vote up the pages that they find using Stumble Upon. But first, you would need to sign up. Ensure that you customize your interests to suit your tastes. The more you stumble and like content, the better the stumble upon engine would become in understanding your preferences and likes.

1) Connect with like-minded people : The real power of any social network comes through the relationships you build. Stumble Upon is quite similar. You can search for like-minded people and follow them. Finding followers interested in the same topics as you is simple. You can start by going to http://www.stumbleupon.com/discover/keyword/ and replace the keyword with topics you are interested in. It will then show you users who are interested in the same things.

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They do get notified and the chances are that they will give you a follow back provided they consider your profile interesting.

Constantly monitor the Stumble Upon review page of the content you have submitted/ thumbed up/ reviewed. Find people who have wrote reviews for it or liked it. If they seem interesting follow them as they share similar interests. Also, as you recommend more and more, Stumble Upon will improve upon it’s suggestion of friend to follow. Be active, follow others, like and review their contents and slowly you will build your network.

2) Don’t submit only your Website pages : Of course you need to bookmark your pages on to Stumble Upon. However only bookmarking your pages won’t give you any major traffic boost. You need to mix it up by being an active user bookmarking, reviewing and voting up plenty of content in your areas of interests and build your profile. The more active you are, the better the chances that people will follow you and would vote up your contents, so that it goes viral. Remember, you are part of a community and people who add value to the community are the ones who are valued the most.

3) Use Clear Titles and descriptions: When you add pages on to Stumble Upon, ensure you give apt and interesting titles and descriptions so that people click through and read. It’s also important to not bookmark your front pages, rather bookmark specific articles which has a better chance of people liking and sharing.

4) Use Stumble Upon Paid discovery if required: Stumble Upon paid discovery is a great way to improve upon your traffic instantly If you don’t want to wait for the traffic to build. There are various plans Stumble upon provides you to choose from.

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You could use a budget as small as $30 and generate about 300 quality visits to your site.

5) Always be using Su.pr to share contents on to other networks : Stumble upon has its own URL shortening system Su.pr . The advantage of using the Su.pr shortener generate shortened links to be shared across various channels is that when a visitor clicks on the link and visits the page they would have the stumble upon toolbar conveniently above the page making it easy for a logged in user to vote up the article giving your more Stumble love.

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If the user loves your content, could also give you some more social media love by sharing the page on other social channels! J

However, the most important thing is to understand that building a following on any Social Channel is not an instant thing. It takes time and a lot of hardwork along with a bit of creativity. But it’s one of the best and the cheapest source of traffic you could generate once you build a following. So invest your time in building a base on channels you think would bring maximum traffic to your sites and have fun doing the same. Stumble upon is a great tool for discovering some amazing content. Discover, learn, build your base and with it gain awesome traffic stats to your website! J

Steve Balmer’s Exit Speech – Pure Passion & Love For The Company!

I have always considered Steve Ballmer as a crazy CEO and have always thought him to be the reason Microsoft missed out on the innumberable opportunities it had to be the leader in the technology business. That doesn’t change a bit.

But have to give it to him for the passion he has. For the love he has for the company. His emotional exit speech was touching. Respect to him for the love and passion he has for the company. I wish every CEO had so much passion and love for the company they ran and not just for the title they held!