{"entry_id": "cf4412ed-5e5b-4149-88d6-35af646c1754", "infos": [{"txt": "Sometimes never compete on price", "language": "english", "position": {"atoms": [{"position_id": 0, "txt": "Sometimes never compete on price", "x": ""}]}, "tags": [], "label": "article_title", "web_segment_id": 0, "global_sentence_id": 0, "edu_l1_label": "BOT"}, {"txt": "The difference between “low prices” as a race to the bottom or as a success story (like Amazon, Costco, IKEA, Vanguard) is in leveraging intentional weaknesses.", "language": "english", "position": {"atoms": [{"position_id": 265, "txt": "The difference between “low prices” as a race to the bottom or as a success story (like Amazon, Costco, IKEA, Vanguard) is in leveraging intentional weaknesses.", "x": "/html/body/div[1]/div[4]/article/div[2]/div[1]"}]}, "tags": [], "label": "content", "web_segment_id": 1, "global_sentence_id": 1, "edu_l1_label": "BOS"}, {"txt": "<img img", "language": "english", "position": {"atoms": [{"position_id": 87, "txt": 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"web_segment_id": 5, "global_sentence_id": 5, "edu_l1_label": "IOS"}, {"txt": " But customers want low prices, and it worked for Costco, Southwest Airlines, Vanguard, IKEA, Amazon, Walmart, McDonald’s, H&M, Dollar General, TJ Maxx, and many others.", "language": "english", "position": {"atoms": [{"position_id": 272, "txt": " But customers want low prices, and it worked for Costco, Southwest Airlines, Vanguard, IKEA, Amazon, Walmart, McDonald’s, H&M, Dollar General, TJ Maxx, and many others.", "x": "/html/body/div[1]/div[4]/article/div[2]/p[2]"}]}, "tags": [], "label": "content", "web_segment_id": 5, "global_sentence_id": 6, "edu_l1_label": "IOS"}, {"txt": " So why are we told not to use a low-prices to win?", "language": "english", "position": {"atoms": [{"position_id": 273, "txt": " So why are we told not to use a low-prices to win?", "x": "/html/body/div[1]/div[4]/article/div[2]/p[2]"}]}, "tags": [], "label": "content", "web_segment_id": 5, "global_sentence_id": 7, "edu_l1_label": "IOS"}, {"txt": "When two products are fundamentally different—in features, integrations, complexity—customers often have no real choice between them.", "language": "english", "position": {"atoms": [{"position_id": 275, "txt": "When two products are fundamentally different—in features, integrations, complexity—customers often have no real choice between them.", "x": "/html/body/div[1]/div[4]/article/div[2]/p[3]"}]}, "tags": [], "label": "content", "web_segment_id": 6, "global_sentence_id": 8, "edu_l1_label": "IOS"}, {"txt": " A large enterprise must use software with single-sign-on, security controls, compliance features, and the ability to scale to tens of thousands of users with roles and permissions and integrations with corporate systems.", "language": "english", "position": {"atoms": [{"position_id": 276, "txt": " A large enterprise must use software with single-sign-on, security controls, compliance features, and the ability to scale to tens of thousands of users with roles and 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", "language": "english", "position": {"atoms": [{"position_id": 321, "txt": " This is exactly why ", "x": "/html/body/div[1]/div[4]/article/div[2]/blockquote[2]/span"}, {"position_id": 323, "txt": "established companies cannot compete on price", "x": "/html/body/div[1]/div[4]/article/div[2]/blockquote[2]/span/a[1]"}, {"position_id": 325, "txt": " on their main product, and thus is an Achilles’ heel for ", "x": "/html/body/div[1]/div[4]/article/div[2]/blockquote[2]/span/a[1]"}, {"position_id": 327, "txt": "startups to exploit", "x": "/html/body/div[1]/div[4]/article/div[2]/blockquote[2]/span/a[2]"}, {"position_id": 329, "txt": ". ", "x": "/html/body/div[1]/div[4]/article/div[2]/blockquote[2]/span/a[2]"}]}, "tags": [], "label": "content", "web_segment_id": 12, "global_sentence_id": 32, "edu_l1_label": "IOS"}, {"txt": "This math is why pundits (including me) constantly admonish bootstrapped founders to “raise your prices.”", "language": "english", "position": {"atoms": [{"position_id": 331, "txt": "This math is why pundits (including me) constantly admonish bootstrapped founders to “raise your prices.”", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]"}]}, "tags": [], "label": "content", "web_segment_id": 13, "global_sentence_id": 33, "edu_l1_label": "IOS"}, {"txt": " Low prices leave room for neither reinvestment nor profit.", "language": "english", "position": {"atoms": [{"position_id": 332, "txt": " Low prices leave room for neither reinvestment nor profit.", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]"}]}, "tags": [], "label": "content", "web_segment_id": 13, "global_sentence_id": 34, "edu_l1_label": "IOS"}, {"txt": " New founders price their products low for the wrong reason:", "language": "english", "position": {"atoms": [{"position_id": 333, "txt": " New founders price their products low for the wrong reason:", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]"}]}, "tags": [], "label": "content", "web_segment_id": 13, "global_sentence_id": 35, "edu_l1_label": "IOS"}, {"txt": " They don’t know how to set prices, and they know their initial product isn’t very good, so instead of making it simple and lovable and winning a reasonable price from their ideal customers who would be happy to pay it, they sheepishly charge a low price, attracting the worst kinds of customers (the ones who can’t afford a proper solution, but occupy the greatest amount of time in tech support), and dramatically increasing the number of customers they must accumulate before they can quit their day job, all with no extra money for marketing or sales or design or product development.", "language": "english", "position": {"atoms": [{"position_id": 334, "txt": " They don’t know how to set prices, and they know their initial product isn’t very good, so instead of making it ", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]"}, {"position_id": 336, "txt": "simple and lovable", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]/a[1]"}, {"position_id": 338, "txt": " and winning a reasonable price from their ", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]/a[1]"}, {"position_id": 340, "txt": "ideal customers", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]/a[2]"}, {"position_id": 342, "txt": " who would be ", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]/a[2]"}, {"position_id": 344, "txt": "happy to pay it", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]/a[3]"}, {"position_id": 346, "txt": ", they sheepishly charge a low price, attracting the worst kinds of customers (the ones who can’t afford a proper solution, but occupy the greatest amount of time in tech support), and dramatically increasing the number of customers they must accumulate before they can quit their day job, all with no extra money for marketing or sales or design or product development.", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]/a[3]"}]}, "tags": [], "label": "content", "web_segment_id": 13, "global_sentence_id": 36, "edu_l1_label": "IOS"}, {"txt": " This is the wrong decision, made in fear and ignorance.", "language": "english", "position": {"atoms": [{"position_id": 347, "txt": " This is the wrong decision, made in fear and ignorance.", "x": "/html/body/div[1]/div[4]/article/div[2]/p[10]/a[3]"}]}, "tags": [], "label": "content", "web_segment_id": 13, "global_sentence_id": 37, "edu_l1_label": "IOS"}, {"txt": "So, is it true?", "language": "english", "position": {"atoms": [{"position_id": 349, "txt": "So, is it true?", "x": "/html/body/div[1]/div[4]/article/div[2]/p[11]"}]}, "tags": [], "label": "content", "web_segment_id": 14, "global_sentence_id": 38, "edu_l1_label": "IOS"}, {"txt": " “Never compete on price?”", "language": "english", "position": {"atoms": [{"position_id": 350, "txt": " “Never compete on price?”", "x": "/html/body/div[1]/div[4]/article/div[2]/p[11]"}]}, "tags": [], "label": "content", "web_segment_id": 14, "global_sentence_id": 39, "edu_l1_label": "IOS"}, {"txt": "Well, no. Of course it can be an excellent strategy to have the lowest prices.", "language": "english", "position": {"atoms": [{"position_id": 352, "txt": "Well, no. 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"label": "content", "web_segment_id": 16, "global_sentence_id": 41, "edu_l1_label": "IOS"}, {"txt": "Jeff Bezos famously quipped:", "language": "english", "position": {"atoms": [{"position_id": 360, "txt": "Jeff Bezos famously quipped:", "x": "/html/body/div[1]/div[4]/article/div[2]/p[14]"}]}, "tags": [], "label": "content", "web_segment_id": 17, "global_sentence_id": 42, "edu_l1_label": "IOS"}, {"txt": " “Your margin is my opportunity.”", "language": "english", "position": {"atoms": [{"position_id": 361, "txt": " “Your margin is my opportunity.”", "x": "/html/body/div[1]/div[4]/article/div[2]/p[14]"}]}, "tags": [], "label": "content", "web_segment_id": 17, "global_sentence_id": 43, "edu_l1_label": "IOS"}, {"txt": " Meaning:", "language": "english", "position": {"atoms": [{"position_id": 362, "txt": " Meaning:", "x": "/html/body/div[1]/div[4]/article/div[2]/p[14]"}]}, "tags": [], "label": "content", "web_segment_id": 17, "global_sentence_id": 44, "edu_l1_label": "IOS"}, {"txt": " While a competitor is extracting profit from some product, Amazon will sell the product cheaper, which either means stealing market share (if that competitor stubbornly maintains its price) or destroying the competitor’s profit (if that competitor matches Amazon’s price).", "language": "english", "position": {"atoms": [{"position_id": 363, "txt": " While a competitor is extracting profit from some product, Amazon will sell the product cheaper, which either means stealing market share (if that competitor stubbornly maintains its price) or destroying the competitor’s profit (if that competitor matches Amazon’s price).", "x": "/html/body/div[1]/div[4]/article/div[2]/p[14]"}]}, "tags": [], "label": "content", "web_segment_id": 17, "global_sentence_id": 45, "edu_l1_label": "IOS"}, {"txt": "But why doesn’t this run into the problems we just outlined?", "language": "english", "position": {"atoms": [{"position_id": 365, "txt": "But why doesn’t this run into the problems we just outlined?", "x": 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others.", "language": "english", "position": {"atoms": [{"position_id": 395, "txt": " They created greatness in some areas ", "x": "/html/body/div[1]/div[4]/article/div[2]/p[17]/strong[2]"}, {"position_id": 397, "txt": "by leveraging specific weaknesses", "x": "/html/body/div[1]/div[4]/article/div[2]/p[17]/em"}, {"position_id": 399, "txt": " in others.", "x": "/html/body/div[1]/div[4]/article/div[2]/p[17]/em"}]}, "tags": ["strong", "em"], "label": "content", "web_segment_id": 21, "global_sentence_id": 53, "edu_l1_label": "IOS"}, {"txt": " In doing so, they created a strategy that others wouldn’t (and didn’t) copy, not because no one wanted to copy their strengths, but because they weren’t willing to copy their weaknesses, which enabled those strengths.", "language": "english", "position": {"atoms": [{"position_id": 400, "txt": " In doing so, they created a strategy that others wouldn’t (and didn’t) copy, not because no one wanted to copy their strengths, but because they weren’t 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# Sometimes never compete on price
## Low price as a complete strategy 
### Costco
### Southwest Airlines
### Vanguard Funds
### IKEA
## Low-cost strategies don’t always require significant financing
