Doug Davidoff
Okay, I admit it – maybe that headline is a slight overstatement. Uhm, on the other hand, I’m not so sure.
Google (and Bing) have gotten a lot of press and attention for their real-time search function. I have to admit that I’m quite impressed by just how quickly I post something with my name in it, and Google lets me know it's out there.
But, I’ve got to tell you – I don’t like it. Frankly it’s increased the noise level, without providing any real value or benefit. Sure, I get the value it may provide for “brands” who are trying to “listen” to what others are saying. And if someone starts saying something bad about you, knowing sooner would certainly help.
However, Google has always succeeded because it focused on benefiting the searcher, rather than the searched. Google’s famous algorithm was tremendously valuable because it filtered a lot out. It made my life (and the lives of millions of others) simpler and easier.
The benefit of Google was very similar to the original benefit of mutual funds. When they came into existence (in 1929), their fundamental value was that they enabled people to make sense of a very complicated investment world. Paying attention to every potential stock was (more than) a full time job. Amateurs just couldn’t keep up with it.
So, mutual funds filtered the stock world for investors. While the average investor didn’t have time to research every stock, they didn’t have to. They could simply select a mutual fund – and the mutual fund manager did the filtering for them. Mutual funds are one of the primary reasons that America became an investment culture.
This worked great until the 1990s. That’s when more mutual funds existed than stocks. The product designed to simplify the world by limiting choice became more complex than the world it was supposed to simplify. It’s no wonder that the underlying performance of these funds deteriorated.
I’ve always lived by the philosophy that just because you can, doesn’t mean you should. I think Google could learn from this as well. While Google focused on more (and focused on matching its competition), I think they’ve opened the world up for a competitor that provides the very proposition that Google originally offered.
Fast growth companies can learn from this. In today's complex world, customers are looking to you to make some choices for them. To filter the world a bit. Sure, the decisions you make will annoy some (just ask Apple), but done properly they'll delight a few. The key to real growth - and real profit - in the future isn't making everyone happy; it's in delighting the few.
What do you think?