Ricky’s Online Business Blog

First of all, let me confess I’m not familiar with the market of instant noodles.  I’m not a regular consumer of instant mee and I don’t how many such brands or types of noodles in the market.

But a discussion yesterday and today inspired me to think about how to compete in the instant noodles market.

Let’s say you have a brand new XYZ mee to sell, how would you compete against giant brands in the market, say Maggi Mee or Cintan Mee?

Are you thinking of new flavors? You want to introduce new tastes currently not offered by Maggi and Cintan? Do you think they can’t do the same and do it better than you?

How about lowering your price and sell cheaper than them? If they charge RM4 per pack (I don’t know how much), then how about you sell at RM3.50? You think they can’t just lower some of their prices and immediately kill you off?

How about competing by promotion?  Good if you have more money and better resources than Maggi and Cintan. What if you don’t have? Even if you have, why waste so much money doing the same things as they do?

Build a better brand? You know how many years it took Maggi and Cintan to imprint their brand into our minds? Will you do a better job and do it faster than them in branding?

How about these ideas?

1. Focus on cup noodles - Don’t stretch yourself too thin. Just focus on cup noodles.
2. Sell the cups - Shift your focus from the noodles to the cups. Sell the cups instead of noodles.
3. More than just noodle cups – Make the cups green and friendly to the environment.  Make it versatile that it can be used to fill water and other stuff too.  Make it attractive with varieties like iPhone covers that people will admire you for carrying the cups.
4. Give away the noodles - For those who come to buy noodles with their cup, sell the noodles at dirt cheap price. I’m thinking of 20 cents per cup or even free!
5. Build community - Build a community of fans who are proud to carry the noodle cups around and show off to their friends. Make good use of Internet and social media to build a strong following.

Do you think Maggi and Cintan can do the same? Sure they can try. But somehow this is a whole new rule of game and it’s not easy for them to change their business model overnight. Doing so might just harm and cannibalize on their existing offerings.

So, don’t sell the noodles, sell the cups! Don’t think inside the box, but get out of the box and think!

Does it work? I don’t know. You tell me. But it sounds better to me than selling another Maggi clone.

And if there are such noodle cups for sale in the market, will you buy and refill the cups with cheap but tasty noodles every now and then?

Perhaps then I’ll start to consume more instant noodles

Last night in the Training & Development Management class, the lecturer was discussing business strategy.  Suddenly he turned to me and asked, “Ricky, how can a magazine compete?”

Without much thinking I replied, “Don’t be a magazine.” Before that, I had been habitually telling people to operate a successful bookstore, don’t be a bookstore; to be a successful nasi lemak store, don’t sell nasi lemak. That is, be bold to come out of your product category, create your own market space and be perceived as offering something different or more than what you sell.

As a matter of fact, I know of one magazine which is not really in magazine business.  The company behind is actually in branding business. They charge clients fees to certify their brand, give them brand awards, and promote them in a number of ways, magazine being one main channel. No wonder I can’t find advertisements in the magazine.

I guess the lecturer asked me about magazine because he knew I used to write a column for a magazine called MBA Edge Quarterly. Again, if I had resources and owned a magazine like this, I would do it in different way, rather than a traditional one going around soliciting for advertisers and presents only good things about MBA. Create an MBA 2.0 magazine!

I have been watching this video and am still deeply moved. It is one of the most watch-able commercials I have ever seen in life. Some of the acting may be too far fetched. But its message is profound.

Question – Why am I different from others?
Answer – Do you have to be like others?

Don’t seek to be like others! Everyone of us is unique and has our own destiny to realize in life!

From marketing point of view, the commercial is also great. Pantene shampoo is a functional product and has its conventional market of shampoo users. But now it seeks to cross over from functionality to emotional appeal. Instead of using logic to tell us why it is a better brand, it seeks to attack our emotion and win our heart over.

Not only will it persuade more people from the its traditional market to use the product, those who don’t use their kind of shampoo maybe bought over too. Who knows I might decide to buy Pantene for my family next time? Perhaps this is one of the blue ocean strategies to conquer a new market.

And the tagline is inspirational – You can shine!

By the way, I consider the Thai language very beautiful phonetically. It is a language I wish to learn if I had extra time.

A business partner asked how to sell hosting to customers when there are other hosting providers who can offer super large hosting space at dirt cheap rate.  For example, 100GB at RM180 only!

While I’m facing the same problems competing in such fragmented hosting industry, these are a few pointers we managed to come up with.

Firstly, don’t try to fight them with even larger space at even lower price.  How about going to the other extreme, by selling small but enough hosting space at half or quarter of their prices?  For example, selling only 100MB at just RM80?  But the customers need to be educated that they actually won’t make use of so much space.

Secondly, expose the tricks (even deception) used by hosting providers.  Nowadays anyone can sell any large amount of hosting space at cheap rates using the “overselling” kind of business model.  This works because statistically an average customer will not use even 10% of the space promised to them.  Some customers are “space-greedy”.  They need to know the inconvenient truth in the hosting industry.

Thirdly, bundle hosting service with other services with prices you have more control on, such as web design.  This way, customers may not know even if you charge them double the hosting prices.

Fourthly, but a very bad strategy – fight the competitors with even larger space at cheaper price!  We know some customers will be lured into this but actually never use so much space anyway.  Nevertheless, I’m against this as it is over-promising.

Last but not least, seek out blue ocean strategies that you no longer need to compete with other hosting providers in such a red ocean.  But seek out new markets and sell to them some services which include hosting service.

Just as an example, how about an online service for couples getting married?  Many couples get married every week.  More and more couples start to want a wedding web site to commemorate such big event!  In providing such service, you no longer compete with other hosting providers but customers will have unknowingly bought your hosting service anway.