First up, Stowe Boyd found this quote about competing with internet research firms Gartner and Forrester:

In our view, firms wishing to disrupt the Gartner and Forrester models must have two particular attributes. First, they need a significant differentiator. It can be in specialization, the business model, service delivery or other areas. Equally importantly, they must be able to scale. That means substantial funding, an effective sales operation, well-honed M&A skills, or a combination of all three.

He then expands on this by explaining his specialization strategy:

I think the key factor in microadvisory firms will be narrow focus. In my case, for example, I exclusively focus on social technologies, and as a result I can remain deeply aware of what’s happening in that (growing) niche. Others will track mobile, or enterprise software, or CRM.

This allows a different sort of scale — not breadth but depth.

As I said a few years ago, ‘I am giving up on balance, I am going for depth instead.’

I think that this is exactly the right approach to take. Instead of trying to be as comprehensive as the big players in the market, you can actually make up ground by going deep. This is another example of ignoring your weaknesses while building on your strengths. Of course, your weak areas still need to meet the minimum baseline, but once you’re over that line, it makes a lot of strength to put resources into areas where you’re already ahead.

The second thing that caught my eye is this:

That’s exactly what it looks like – a full-size replica of a Ferrari engine, made out of wood. It’s innovative, but I’m not quite sure where the market is for it. On the other hand, whatever the target market is, I’m not in it, so maybe I’m underestimating it’s size.

I’ve talked before about innovative craft-based business models, but I was thinking more along the lines of something like Saddleback Leather Co. On the other hand, this is clearly a unique model, or a labour of love, or both…

You can afford to be that iconoclastic if you are making a one-off item that only has to find one person that thinks it’s cool. It’s quite another to be so removed from the market if you are aiming squarely at the middle. The Gap is doing precisely that, which is what makes the flap over their new logo so gobsmacking. I like this take from Peter Lloyd at IdeaConnection:

In our marketing democracy, all top-down leaders eventually face the fate of national crowned heads, sovereigns, and tyrants. And most of them do it to themselves. Right after they lose touch with the source of their power, their consumers. Then, like Gap North America President Marka Hansen, they’re forced to tap dance backwards:

“Now, given the passionate outpouring from customers that followed, we’ve decided to engage in the dialogue, take their feedback on board and work together as we move ahead and evolve to the next phase of Gap.”

Like Lloyd, I am astonished that the idea of talking to customers only occurred to them after all this happened. That’s also why aiming for the middle stifles innovation – the middle doesn’t like change.

Innovators need to aim for the extremes, either the cutting edge, or the laggards. Which takes me back to the Stowe Boyd post. Extreme specialisation is one good way to do this. Going deep ensures that we are in touch with our customers, making it much easier to be innovative.