Is your weakness really your strength!

I love to ponder about technology, not just the algorithms but also the business side, how technology companies are run, how they are perceived. As I was driving down US 101 today not more than 5 miles from ebay’s headquarters I saw a billboard from ebay with their new “Fill your cart with color campaign”. That’s when I was reminded, hmm hey this ebay thing is still around and when was the last time I shopped there? I don’t remember. That’s when my thoughts went down memory lane. It wasn’t long ago that I remember reading the opinions of various wall street pundits about ebay. The great business model that ebay represented. Their biggest asset “No inventory”. Compare that to another business model that was…ahem Amazon. Expenses were high, inventory was (supposedly) a huge problem. Invest in ebay and you could not go wrong. Now I haven’t kept up with the ebay stock or for that matter have never truly followed it so I don’t know if it was a good investment or not. I was merely thinking of them as a consumer. And as a consumer the lasting impression that is etched in my mind about ebay is that, I may get a good deal but shipping is always going to be a pain. For some reason I just remember that every good deal was a bait and switch offer to scam you into paying a ridiculous amount for shipping the stuff. And this was for slow 4–7 days of shipping, try getting the stuff sooner and you were in for a shock. It turns out that one of the biggest reasons for me to prefer Amazon is Amazon Prime, the additional cost not withstanding.

How did Amazon turn its weakness, inventory into a strength. Did it even think of that as a weakness. Who knows. But as I look back, the fact that Amazon turned around their weakness, inventory and shipping stuff from a few central locations to one of their greatest strengths has to be one of the biggest stroke of luck or foresight in the history of companies. ebay to me (as a consumer) is always on the fringe, a vendor I do not even think of when I go online shopping. There is no reason they cannot replicate the buying experience that Amazon provides. But for them to replicate the same customer experience is the difference between an Amazon and ebay. I can see how shipping stuff from central locations would allow Amazon to broker some great deals with the shipping companies. ebay does not have that option. Game over.

Moral of the story, every time someone says that one business model is better than other because of so and so, instead of taking it on face value think of how you can change your weakness into your strengths. The so called experts are usually short sighted and will build scenarios that corroborate their story. A true disruptor can take ones (perceived) weakness and turn it into one of its strongest assets.

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