Why Startups Gain Much More Traction over Major Brands


Ruby Tuesday closed 30 restaurants and Blockbuster is going out of business. Why are some of the largest brands we have  grown up with not been able to keep up, despite the many improvements they have made or the many followers they have accumulated.

One word comes to mind when we look at the main reason a major business collapses over the rise of a newer smaller entity that delivers more. While many think it is efficiency, I believe it is adaptability.

It takes 10 mins for a startup to capture on a new trend, client base, or shift direction and seize opportunity, while it takes 1 year for a major business to tweak something as small as a menu. The inability to adapt and bureaucracy of change is what drives big business down and allows small business to seize precious market share and deliver the customer an experience that is new and can win over their loyalty.

Big business looses because it is reactive, not proactive.

Look at an Apple, it introduces a new iPhone or product almost quarterly to help keep clients happy with new tools and features. Despite small changes, this model worked to gain massive momentum and keep smaller technologies or competitors from stealing clients.  The exact opposite can be said as to why Ruby Tuesday, a chain with actually decent tasting food, can’t keep more people coming back.  By the time Ruby Tuesday introduced new menus, and better quality, people were already eating elsewhere. While its easy to keep clients engaged with your brand, it is much harder to bring them back once you lost their trust.

Think about this in the sense of a relationship between two people, you don’t have to be the greatest guy to be the greatest friend and can continue a great relationship with your friends. It is, however, much harder to get your friends back after they lose trust in you. The same can be applied to business and is the reason why great businesses gain great traction and compete with huge companies despite low overhead and much smaller 1-5 man operations. 15 years ago, people didn’t have a choice but today they are given many, so be careful next time you decide to spend 5 months trying to do something that can make you lose your clients next month if not done.