Not that I would be motivated in any way to go for, but I just wondered what would be the best way to make it to the Olympics – as a participant. Probably practicing for the 100m dash is not a good idea. There are billions of people that are good at running, and probably a lot of them will be more talented or better than most of us will ever be. And running is quite simple: Anybody can do it. The same applies for swimming, playing soccer, boxing, etc.
These sports have a relatively low “entry barrier”. You can just start doing it without buying tons of equipment or travelling hundreds of miles to make it to the next club where you can train. Also, they are very popular: A lot of people like to watch it, these sports are well developed commercially and everybody loves to be part of that popularity.
That’s a bit different for sports like Modern Pentathlon, Skeleton or Curling. Completely unpopular and with high entry barriers: Probably most of you don’t have a curling club in their neighborhood. Finding a skeleton coach and track in a country which is not one of the ten or so that have a national Skeleton organization may be hard. Getting up to speed in pistol shooting, fencing and show jumping that go along with running and swimming in Modern Pentathlon is also something that not a lot of people try. But if you commit yourself to one of those it is significantly more realistic to make it to the big event.
The point is: No matter if you win the 100m dash or the Modern Pentathlon, you get the same gold medal at the same Olympic Games.
In business, the same approach works. You can compete where everybody else does, too. You can try to sell the 37th brand of detergent or open the fifteenth coffee shop on the main street, or you can try to find a market that may not sound very popular but allows you to specialize and use that specialization for building market entry barriers for others. The good thing is: You can also win a gold medal there. It’s probably no coincidence that the business term used for companies that follow this strategy successfully comes from the world of sport: Hidden Champions.
Companies that specialize in niche application do in turn not only focus on a small regional market like the coffee shop on main street does, but try to become world market leader instead. There are countless examples, and economies with e.g. a strong engineering tradition like Germany or Japan strongly build on the economical power of those Hidden Champions.
It may not help your personal popularity when you’re doing small talk at a cocktail party and talk about your business if you’re specialized in producing measuring instruments, metal cutting tools, wine harvesting machines or fish dissection devices. You might not even get invited to the cocktail party at all, but it pays your bills better than anything else.
And no matter if you are a hidden champion or one in a popular discipline: The gold medal is the same.