CEO’s Blog

Even with the economy tanking, we are still kicking butt here at Bodybuilding.com. Revenue has never been better. Here’s a little story I wrote to illustrate why I think this is…

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The 3 Little Company-Building Pigs

Once upon a time there were three little pigs that decided to each build a company.

The First Pig

The first pig wanted to do it the easy way. He built a company that was focused on the short term. He wanted to "get rich quick". He didn’t care about his customers or focus on the customer experience. He outsourced most of the functions of his business (customer service, IT, fulfillment, etc.) to other companies so he didn’t have to deal with it. He lied to his customers and used marketing gimmicks to get as much money from his hapless customers as possible. He didn’t care about his employees or the culture of the company he was building. He treated them like crap and thought they were easily replaceable. He didn’t focus on keeping his costs low and doing things efficiently, and wasted a lot of money on things that weren’t important to the customers.

Then suddenly the Big Bad-Economy Wolf came into town and saw the company that the first pig built. As he huffed and puffed, he stole money from the overall economic market and from the overall population, stalled overall economic growth, and seized up the credit markets so that businesses have trouble getting financing for new initiatives and to buy inventory. He easily blew the first pig’s company down. It didn’t have any legs to stand on and had no way to combat the wolf, and had to file for bankruptcy.

The Second Pig

The second pig was similar to the first pig, but he spent some time thinking about building a medium term company. He implemented some of the basics of customer “service” (the bare minimum) to at least keep the customers “satisifed”. He tried to be nice to his employees so they at least wouldn’t quit too quickly, but didn’t really care too much about them as people. He spent a lot of money on marketing (SuperBowl TV ads, radio ads, search engine ads, etc.) in order to convince enough people to purchase from him. He didn’t really spend money innovating or creating customer value, but the big marketing budget helped him to grow.

The Big Bad-Economy Wolf came upon this second company and huffed and puffed. It took a little longer and was a little tougher for the wolf, but eventually the company couldn’t deal with the bad economy anymore and came tumbling down and the pig shut down the business for good.

The Third Pig

The third pig was different. He wanted to build a company that would last for a hundred years. First, he built a world class team of people that were smarter than him, and he did everything he could to show them how important they were and to make them happy. Together, they focused 100% on building customer loyalty by creating innovative products and features that the customers valued a lot. They focused on the customer experience so that they would get free word of mouth marketing. They focused on limiting their marketing budget and spending the money on building value for the customer. They kept their costs low by being productive, efficient, and not spending money on things that don’t matter to the customer. They were lean and mean. They worked hard and built a solid company that both the employees and customers loved.

The Big Bad-Economy Wolf came around just like he did with the other businesses. He used the same tactics that decimated the other two companies, but no matter how hard he tried, he could not blow down the company. Frustrated, he moved on (as bad economies always do), and during the next wave of prosperity, the third pig’s company came out even stronger and with less competitors than before.

Can you guess which little pig Bodybuilding.com is trying to be?

This entry was posted on Friday, October 10th, 2008 at 1:55 pm and is filed under CEO Thoughts. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.