What Netscape/AOL Means
to You & Me
Alright, now that everyone has settled
down from the announcement of AOL's rescue of Netscape, I think we should
all unbuckle those belts, sit back in the easy chair and ruminate over
exactly what something like this really means to people like you and me.
Just think about it: Less than two oil
changes ago, Netscape was one of the hottest internet-based companies,
the darling of Wall Street. Today, it lies flat on its back, gasping for
oxygen -- and still ranks as one of the ten most successful IPO's in stock
What's wrong with this picture? Anybody?
Anybody? Bueller? Okay, since nobody else is piping up, let me offer my
two cents' worth. And pay attention, because if you're not careful, you
could suffer the very same humiliation as our browser friends now must
How, exactly, does a Wall Street winner
go from champ to chump in less time than it takes to stir up a really
bad cup of instant coffee? Pretty much like this:
You start with practically 90% of the
market and then ignore everything else.
Yup. It's that simple. Netscape had a
death grip on the market and they let it slip away. Not because of inferior
technology. Not because of under funding. They lost their grip because
of the most common startup affliction of all: myopia. What Netscape should
have been doing from Day One was building their defenses against the Microsoft
machine, which anyone with a half-active brain could have seen coming.
Netscape should have built stronger marketing alliances and integrated
relationships with a strategically-chosen team of partners so that Windows
users would have had to do some serious thinking before switching over
to Internet Explorer.
But they didn't. And the result was that
zillions of Microsoft users said, "What's the difference?" and
switched to a browser that came with a marketing strategy built right
Netscape's biggest mistake was not establishing
programs. They never built a true brand that inspired user loyalty (and
rabid anti-Microsoft Mac users don't count, because we'd use anything
other than Microsoft if we could help it).
So what can we really learn from the Netscape/AOL
issue? Well, a couple of things: First, it's always better to establish
a beach head than to run for cover. And it's easier to build that strength
BEFORE you go out and market yourself to the world. Second, no matter
what you build, if you haven't built in brand strategy, you can lose it
all in a heartbeat. And third, a really good spin doctor is worth his
weight in gold.