Customer Service Beats Competition

Josh Hix shares his philosophy on handling competition in consumer businesses, emphasizing that success comes from customer focus rather than competitive positioning. He uses examples from the food industry to illustrate how large markets can support multiple successful players.

• Core Competition Philosophy:

  • Ignore the competition
  • Focus on understanding and serving your customer well
  • Success follows if you're in a big enough market

• Market Size Perspective:

  • Large markets can support multiple successful players
  • Example: Chipotle
    • Primarily lunch-focused business
    • Limited menu (6 ingredients)
    • Not fully national
    • Still generates $4B in revenue despite numerous competitors

• Business Success Factors:

  • The key question isn't "Are we stealing customers from competitors?"
  • Instead ask: "Do we understand our customer and serve them well?"

• Strategic Approach:

  • Followed Amazon's mantra
  • Let customers be the focus
  • Let competitors figure things out on their own

• Market Examples:

  • Grocery stores demonstrate market size potential
    • Albertsons does $60B in revenue
    • Succeeds despite many people never shopping there
  • Success possible without total market dominance

This perspective suggests that in consumer businesses, obsessing over competition is less valuable than deeply understanding and serving your customer base, particularly in large markets that can support multiple successful players.