The Passing Lane: Passing the Competition Online by Marnie Perhson

Issue #1 Monday, Sept. 14 ,1998

About the Author:

Marnie Perhson

Marnie Pehrson, founder of C.E.S. Business Consultants and the International Association of Computer Professionals, develops products that help computer professionals market and manage their businesses.

She is author of
How to Run a Successful Computer Training Business,

How to Get & Keep Customers for Your Computer-based Business

and Keeping Your Sanity in a Home Business.

Marnie also develops business plans, marketing strategies, financial projections, & proposals for Internet projects. Her plans and strategies have garnered clients an average of $100,000 each in seed capital.

Marnie lives on a Georgia farm with her husband and their six children.

C.E.S. Business Consultants
Ringgold, Georgia
TEL: 706-866-2295

Using the Internet to Jump the Competition

Welcome to the new Sideroad series, The Passing Lane; Passing the Competition Online. The goal here is to help business professionals learn to use the Internet and the Web to become more successful. I'll be talking about Internet marketing and ways to gain the competitive edge for your business by using the Net to its full potential. I'd like to start off with a look at a recent news story that caught my attention. It's a perfect example of why some businesses are successful on-line while others are not.

Reuters carried a story about Barnes & Noble ( and how they are selling off 20% of their on-line business. Both and, its main competitor, are posting losses of $23 million and $21.2 million respectively in the second quarter of this year. But's stock is soaring at $129.375 a share, while Barnes & Noble's stock was trading at $39 3/4 on the same day. One industry analyst, Ehrenkrantz King Nussbaum stated, "This is really part of a war. Barnes & Noble is considered No. 1 in the industry, but it looks like a No 2 in the stock market."

How can this be? Why would a big powerhouse like Barnes & Noble have a stock price so far below Amazon's? There are two reasons for this apparently unfair phenomenon.

First, although Barnes & Noble is #1 in the bookstore market, they aren't #1 in the "on-line bookstore" market. The first rule of marketing tells us that to be a leader, you have to be first in the mind of the prospect. Whoever gets into the prospect's mind first, wins. Think about it. Xerox was first in copiers, Jell-O was first in gelatin, and Amazon was first in on-line bookstores. Barnes & Noble may have gotten established first in the physical bookstore market, but Amazon beat them to the punch on-line.

The second reason for the disparity in stock prices is that the Internet is what's hot on the stock market these days. People see potential there. There's that speculative uncertainty and possibility about it. But, the bookstore market is a well-known one. It's a tried and proven market. There's no room for speculation there. As the Web becomes a more stable environment, the run-away stock prices of net-based corporations will stabilize as well. I'm no stockbroker, but I'd say a stock price of $129.375 a share is a little over inflated and probably won't last for long.

What can we learn from this? It pays to be on the fringe - the frontier - the first - even if you have to make up a new category to do it. Amazon would have failed miserably if they'd tried to open a physical storefront. Instead, they created a whole new category as an on-line bookstore and became the first in that new category.

Look at your competition and how they are going (or have gone) on-line. What aspect of their business are they promoting? Don't just jump on the same bandwagon. Find something you do differently, something that sets you apart and become "first" to be known for it on-line. Put all your marketing efforts into promoting your category on-line, and you'll be positioning yourself for success.

Text Copyright © 1998, Marnie Pehrson. Part of the original Sideroad.
The new Sideroad is now receiving traffic at