
"Create like a god--Command like a king--Work like a slave."--Jacket.
Also, don't ever stop a startup because someone else is doing it. Name an industry with only one company... With only 10!! If anything it validates the market. At my first startup we consciously decided not to build a new product that was going to face many other entrants, despite the fact that we were experts in that domain. Guess what - the next year, 3 of the top 10 best sellers were in that category! Expensive lesson learned.
And in case you think "well why should I follow pg's advice," then go read a copy of Rules for Revolutionaries by Guy Kawasaki. Same basic ideas, only about 20 years before!
Good luck.
I don't give out enthusiastic compliments easily.
Seriously, if you enjoy doing this, you might consider turning it into a book. With your writing style, your domain expertise, and your marketing acumen, you'd probably make a mint.
"Get Over the Paranoia: The story may be apocryphal, but Nordstrom supposedly allowed a customer to return an automobile tire that he insisted he bought at the store. Of course, Nordstrom doesn't sell tires.
"The paranoid would ask, ``But what if everyone who owns a car returned tires to Nordstrom? Nordstrom would go broke!'' But people won't (and don't), and Nordstrom will never be in danger of going bankrupt for accepting returns of goods it doesn't sell.
"Managers are afraid to implement customer-pleasing, revolution-catalyzing policies because they are afraid that too many people will take advantage of these policies, and they'll end up with the equivalent of a store full of tires."
The entire section goes on to talk about employee empowerment, allocentralism (putting yourself into your customer's shoes), examples from other businesses that either do this or don't, and so on; the relevant summary part from the text would probably be, "However, if your competition is asking people to do something suboptimal, then it's creating an opportunity for you."
So, straight up: it's certainly possible to run a business the way that you're describing. In fact, I'd guess that that's how most businesses run: they do as little as possible to make their money and meet -- but not exceed -- their customers' expectations. So you're not wrong as far as that goes.
But you are wrong to assume that they'll have "a ton of noobs" if they treat one particular customer really well. And, you're equally wrong to assume that having "a ton of noobs" is a bad problem to have; from another part of the same section of the book: "For example, a Whirlpool employee taped a news program's interview with Gail, a woman with several children and a full-time job. Whirlpool employees were challenged to provide appliances that would ``take care of Gail.'' In response, they redesigned the stovetop of Whirlpool's CleanTop to be completely flat, without grease traps or dirt-collecting crevices, and they created the Quiet Partner dishwasher, so the noise of the dishwasher wouldn't distract Gail. Viewing chores through Gail's eyes has helped Whirlpool introduce significant product enhancements."
Having "a ton of noobs" would mean a ton of new customers that are paying you money to show you what is wrong with your product or service. They are a great resource to have, if you take advantage of them. If you can identify one problem that 35% of "a ton of noobs" all have in common, and if you can automate the solution to that problem (or make it significantly easier to solve), then you have just achieved differentiation in a crowded market.
Yes, it can be painful in the short term. You might have to hire some more help -- and you might have to streamline some of your other internal process, like your ticket system, which will also pay dividends in the future.
Avoiding pathological customers is certainly good advice for freelancers, consultants, and really small shops. However, it is not necessarily the only good business strategy.
Im a big fan of Rules for Revolutionaries and Art of the Start was OK but since then I havent read anything that I have been impressed with.
Not sure how his start up portfolio has faired: http://www.garage.com/portfolio/
You can contact them, offer to take them to lunch if they're local-ish, and see if there's any potential or willingness to collaborate. Maybe you each prefer to handle different aspects of the market.
Or, you can decide to not lose focus, and you can concentrate on the clients and customers and market that you have. Continue to do what you're good at doing, and keep slowly improving your product or service. So, maybe you won't be the biggest player in your market ... and maybe that's OK.
Or, you can learn to really enjoy competition. (I love it.) You can use this as a great opportunity to get free advice on areas you can improve, because all you have to do is keep an eye on what your competitor does. But, don't become defined by them. Try to figure out how to be better than them. That doesn't necessarily mean being cheaper, or shinier, or faster. That just means figuring out what your customers want, and then doing the best job of providing that that you can imagine. You have to be able to have fun competing with the other company. Being genuinely friendly with them (and helpful to them!) while trying to think up ways of putting them out of business, that sort of thing.
"Rules for Revolutionaries" is a great book that touches, in part, on handling competition. It's a quick read and fully worth it, if you have the time or inclination.
The guy quoted in RWR slammed case study books because they are soft-touch "how to build great companies" - but that's only SOME of them. The - you guessed it - fluffy ones.
"Don't read books that are nothing but fluff" is just not a battle cry people click on, so instead they say "don't read business books!"
Read Positioning, Spin Marketing, Pricing with Confidence, Getting to Yes, Rules for Revolutionaries, Purple Cow, etc., etc.
If you read, say, Purple Cow, or Positioning, or Pricing with Confidence, and don't come away with actionable ideas, you either have an empty head or were just running your eyes over the words and not thinking.
And read lots of biographies. They're practical storytelling - learn from me, kid - pinned down on paper.
