The Copycat Economy: A Sea of White

The subtitle of my latest book is “How to Compete in a Copycat Economy.” When people ask me to explain the Copycat Economy, I often start talking about why markets have become so fragmented, why so many companies have seen their products become lower-margin commodities and why so many companies are frustrated that their services are being so blatantly imitated by competitors. Lately, I’ve gotten simpler. I talk about the Copycat Economy as a “sea of white.” I got this idea from a comment by Whirlpool’s former CEO David Whitwam. In trying to explain the financial and market stagnation of his company in the ‘90’s, his “aha!” moment came in a retail outlet in 1999. Here’s what he said: “I go into an appliance store. Now, I have pretty good eyes. I stand 40 feet away from a line of washers, and I can’t pick ours out. They all look alike. They all have decent quality. They all have the same price point. It’s a sea of white.” A sea of white. That pretty much describes things nowadays, doesn’t it? Here’s a little sampling of tidbits I’ve picked up in the business press just in the last month: • Starbury (among a growing crop of new competitors) is taking on Nike with a similar-looking fashionized basketball shoe—for $14.98. • New airline carriers like Eos, L’Avion, and Silverjet are offering overseas business-class comforts and amenities at bargain basement prices. • Other than biotech, the fastest growing part of the pharmaceutical industry over the past few years has been the generics business—the ultimate copycats. • Financier George Roberts of KKR says that it used to be tough to find the money to do deals in the past, but no more. Today, “finance is a commodity.” With the explosion of interchangeable hedge funds, private equity firms, international banking and financial institutions, and such, “I have never seen a time like this when money is as available and so global.” • As technologies improve and competitors multiply, the prices of flat-panel, high definition TVs, both plasma and LCD, have declined by 30 to 50 percent from one year ago. • Websites like WebMD and Steve Case’s new venture RevolutionHealth.com, are finding it necessary to offer more and more similar, and free, healthcare information and services in order to attract users.• Did you know it’s getting harder and harder to become a supermodel, or to make serious money as a big-time model? The reason, in designer Nicole Miller’s words, is because “there are so many models now. It used to be the Americans, Europeans and Canadians. Then we got the influx of Brazilians, Russians, and Eastern Europeans.” According to the Wall St. Journal, it’s a “deluge of fresh faces” that have created interchangeable bodies and siphoned off thousands of dollars from individual models’ annual compensationsOnly when Whitwam came to terms with the fact that his company was just another big white player in a sea of white did he begin to move Whirlpool in directions that violated industry convention and Whirlpool’s own culture and history—steps which led to new ventures, new partnerships, new hires, and ultimately, a series of high-tech, high-function, high-design, high-cool, high-unique products that finally gave the company some color. And higher prices. And more sales.