Crack in the playground strategy

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How to make money in the networked world.

1. get a killer product: Offer a product that is really good, and habit-forming.
2. Offer it as a service: Contrive a way to offer it as a service and not just a, you know, unitary product.
3. Loss-lead: Offer it really cheap. So cheap that people who would never normally buy the product (e.g. taxis) think, “Oh, what the hell” and buy it.
4. Keep offering it at that insanely good price long enough for a durable habit to form.
5. Ideally, the customer will think this new service is so good that it kills off the old mechanism by which it satisfied this need. Perhaps you’ve driven it out of business!
6. Once you sense a dependency, gradually deprecate the quality of the product, or jack up the price.
7. If it is a really solid dependency, you can do both!
8. That’s it.

Examples

Twitter, Pret a Manger, Netflix, Uber,

See also

• Get off Twitter
• Software as a service