Do you dream of dominating your industry? Of having so much control that you can dictate terms and crush your competition?
In an era where competition is fierce and innovation reigns supreme, some bold entrepreneurs have dared to dream bigger than ever before.
Welcome to the realm where groundbreaking strategies have been wielded as weapons of success, propelling visionary business owners to the summit of their industries. Whether it sparks controversy or admiration, there’s no denying that monopolising an industry holds the key to scaling businesses and amassing immeasurable wealth.
Proprietary Technology, Copyrights and Patents
Your proprietary technology gives your company a leg up in the market and guarantees that no one else can produce an identical product. For companies like TradingView, their proprietary technology forms the foundation of their competitive edge in the market. By developing innovative and unique trading platforms, tools, and features, TradingView can differentiate itself from its competitors.
This licensing method is another way companies can foster brand loyalty among their clientele.
Another technique to establish a near-monopoly market is through copyrights and patents. Intellectual property includes recipes, drawings, ideas, and songs and is protected by laws granting creators a monopoly on using those works. For instance, in the IT industry, Microsoft Corp. (MSFT) had a de facto monopoly on what amounted to a breakthrough new way for computer users to navigate and manage their on-screen activities due to the copyright of its Windows software.
Similarly, Coca-Cola developed a secret formula for its soft drink that rival companies could not replicate. Coca-Cola kept its secret recipe and production process a secret, making it such that no one else could make their soda.
Government Assistance
Assistance from the government has historically proven to be a powerful catalyst in propelling certain companies toward monopolistic positions. A classic example of this is the case of Aliko Dangote, the renowned African billionaire. Dangote’s remarkable success and dominance in various industries — particularly in cement manufacturing and commodities trading — can be attributed, in part, to the support and assistance he received from the Nigerian government.
One of the key ways the government aided Dangote in achieving his industry domination was by granting him exclusive rights or licenses to operate in certain sectors. Such exclusive arrangements allowed Dangote’s companies to enjoy preferential treatment, making it exceedingly difficult for potential competitors to enter the market.
Brand Equity
Brand equity is the value that a brand has over and above its tangible assets. It is created by consumers’ positive associations with a brand, such as its quality, reliability, and trustworthiness. Brand equity can be a powerful tool for businesses, as it can help them to command premium prices, attract new customers, and retain existing ones.
One way to create brand equity is to develop a strong brand name. A good brand name is easy to remember, pronounce, and spell. It is also distinctive and relevant to the company’s products or services. For example, the brand name Apple is instantly recognisable and associated with high-quality, innovative products.
Another way to create brand equity is to focus on customer satisfaction. When customers have a positive experience with a company’s products or services, they are likelier to develop a strong emotional attachment to the brand. For example, Nike is known for its commitment to customer satisfaction. This has helped Nike build strong brand equity and command premium product prices.
Strong Distributor Network
Most successful businesses, such as Coca-Cola and Amazon, use this strategy by carefully selecting distributors who are a good fit for their business and target market.
One way to create a strong distributor network is to form exclusive partnerships. This means that the distributors agree to sell only the products or services of the business. Another way to create a strong distributor network is to offer distributors attractive terms. This could include high commissions, exclusive territories, or marketing support.
Licensing Rights
Depending on the nature of your company, you may need to get a grant from the relevant country to secure exclusive access to an international product for domestic sales.
If you have the exclusive right to sell a foreign product in your country, it is difficult for anyone else to enter that market. Competition in India is hampered by the fact that online marketplaces like Flipkart and Amazon are solely authorised sellers of products by some of the world’s most well-known companies.
Economies of Scale
A business owner can also establish a monopoly by selling things in high quantities at low prices. Companies often adopt a centralised purchasing approach because it increases their scale and, in turn, reduces their average cost per unit. Using economies of scale to your advantage can deter new entrants. This business model is used by bargain retailers like Walmart, DMart, and Big Bazaar to stock up on cheap goods and still turn a profit.
Excellent Customer Service
Providing exceptional customer service can lead to increased customer loyalty, positive word-of-mouth marketing, and a strong reputation, all of which contribute to dominating the market.
There are many ways that businesses can provide excellent customer service. One way is to be responsive to customer inquiries and complaints. Customers appreciate companies that quickly respond to their needs and take their concerns seriously.
Another way to provide excellent customer service is to be knowledgeable about your products or services. Finally, businesses can provide excellent customer service by being friendly and helpful.
One example of a company that has successfully utilised excellent customer service is Zappos. The online shoe and clothing retailer has built its business model to deliver unparalleled customer experiences.
Another famous example is Amazon. Amazon is known for its excellent customer service. The company offers a variety of ways for customers to get help, including 24/7 live chat, phone support, and email support. Amazon also has a reputation for being quick to resolve customer issues.
Conclusion
Privately imposed monopolies are intended to limit competition and increase profits, as opposed to monopolies imposed by the government or government regulations, which are typically intended to protect consumers and innovative companies.
If just one company sells a particular good or service, it can set whatever price it likes. Those unwilling or unable to pay the asking price are denied access to the commodity. The motivation and circumstances that give rise to monopolies will persist for good and bad reasons.
Consequently, the struggle to adequately regulate them so that customers have some choice and rival firms can thrive will be a constant feature of the landscape for the foreseeable future.
