The overlooked competitive advantage


It’s 2008, and a soon-to-be mom is overwhelmed with preparing for her new addition. As she readies baby clothes by pre-washing them, she breaks into an allergic reaction with hives all over her skin. The detergent her mom recommended as safe for kids wasn’t even safe on adults.

She freaked out. She hunted to find a new detergent, now with a deeper urge to find even more safe things for her kid. Diapers that didn’t contain harsh chemicals. Cleaning supplies. Wipes.

That was the moment she thought she could build a company to do this. She should right?

Except, of course it’s not that easy. Procter and Gamble (P&G), which owns the Pampers brand and many others, is a megacorp with $80 billion in revenue each year, relationships with all the giant retailers, and an endless list of talented researchers and scientists. How can one possibly break through?


I like McDonald’s. Not going to hide that. I’m a fan 🙂 It’s tasty. It’s consistent. And most importantly, it’s convenient. I was buying lunch there recently when I noticed how fast their credit card processing machine was. I’ve never seen a machine process my credit card that fast.

It made me wonder if McDonald’s is even actually processing my card. Instead, maybe they do a quick check to see if my card is valid, but don’t actually charge my card synchronously? (Turns out I’m not the only one surprised by the speed McDonald’s is processing these cards).

I still don’t have an exact answer. Some people share my speculation about the instant approvals. A friend from the point of sale industry didn’t think it was far fetched if McDonald’s was doing this. They let the charge go through with an instant approval and take on the risk if the charges don’t actually transact later.

But more interesting to me is why? Not how McDonald’s is doing it, but why did they make an effort to be so much faster than everyone else processing credit cards.

For every six seconds saved at the drive-through sales increase by 1%.

That’s why.

Convenience. It’s one of the most overlooked competitive advantages we have as business owners.

When we learn economics in college we learn that consumers judge goods on their price. But we often forget to factor in the time we spend on those goods. Have you ever made a decision to buy dinner here or there based on convenience and price wasn’t even considered? Which would be fastest? Easiest? Not require more than sweat pants? Of course you have.

As a business owner you really need to ask: is your product truly more convenient, and if it’s not, how might your competitors “outconvenience” you.


Let’s go back to our wannabe mompreneur. She created that company. She got her own diapers and wipes and products manufactured. She didn’t have the resources that P&G research labs has. She didn’t test them on thousands of focus groups. She used them at home on her kid and family.

Eventually, 3 years after she had those hives, Jessica Alba, well known for her roles on TV and movies, launched Honest.com.

Photo from Gage Skidmore

It obviously wasn’t easy. And most people don’t realize this was actually Jessica’s idea and business from the start. Some throw her into the same class as celebrities like Donald Trump whose name appears on someone else’s product and they call it “theirs”.

But why did she succeed? It clearly wasn’t the technology. And it wasn’t her celebrity status either. I’m sure it opened some doors, but Jessica could barely get anyone to listen to her in those first three years:

Everyone I talked with in Hollywood could not wrap their heads around the idea. Whenever I tried to sit down with them about it, they would just get this glazed look on their faces. Entertainment is a totally different business. It’s hard for people to take anyone seriously who’s never done this before. They see you only as something else. But all that just gave me fire to move forward.

Even Brian Lee, founder of some well known celebrity endorsed brands like ShoeDazzle, initially rejected Jessica and her idea. Now he’s the CEO of Honest.

So what was it that eventually turned Honest into a billion dollar company?

Convenience.

Jessica took the pain of researching the mess of toxic chemicals and current market, and made it easy to signup for a subscription to safe and socially conscious products: Diapers, wipes, and more.

She’s not the only one. Dollar Shave Club has done the exact same thing. They didn’t even have to figure out a more green or superior product to, say, a Gillette razor. They just outconvenienced P&G. Every month you get new stuff. You never have to think about going to the store for razors again.

That’s not a lesson lost on me. A big effort we’ve made at Highrise that has helped our turnaround has been simply looking for places our customers have too many steps. And we’ve found plenty. Maybe it’s an extra click in our product to do something. Or maybe it’s an extra app they have to open to accomplish something that could be done right inside Highrise. Now we have customers dumping their newsletter providers because they can save a bunch of time using our own bulk email service.

That’s powerful, and it’s overlooked. We spend enormous amounts of energy and time as business owners trying to invent the most gee-whiz technology or iterate on what currently works. Recent new products from P&G include apple scented Head & Shoulders and a bluetooth toothbrush to record your brushing time. Someone thought we spend far too long trying to record our brushing time with today’s toothbrushes?

But Honest and Dollar Shave Club have simply been more in tune with the convenience their products afford us, and they’ve created billion dollar companies in markets P&G should have had locked up — a problem that’s caused P&G to go through three different CEOs in three years, and Warren Buffet to dump his stock. P&G is scrambling to figure out what’s gone wrong.

Simple. They’re getting outconvenienced.

P.S. If you enjoyed this article, you should follow my YouTube channel, where I share more about how history, psychology, and science can help us make better decisions. And if you find yourself overwhelmed while organizing your own small business, check out how Highrise can help!

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