What is the buggy whip maker

Early 20th century

The car seems to be winning the battle and is replacing the horse-drawn carriages. Ford's black Model T is now being mass-produced and due to its low price and reliability it is conquering the market.

At the same time, cart whip makers in the US are seeing their sales plummet. Panicked, most of them modify their product (e.g. add new colors), reduce prices and invest in advertising and promotion (e.g. two for one).

buggy-whip-maker

None of them survived, failing to realize that the environment had changed and that the whip had been permanently replaced by a newer technology - of the 40 whip companies, only one is still in business today.

Same was the fate for companies that used to make swords, cassettes, films, watches (especially the Swiss manufacturers of expensive analog watches) and so on, which were forced to exit the market.

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The few who survived were those who saw where the market was moving and how they could be part of this development. Those companies set two questions to themselves: “where am I good at?’’ and “what new products can I produce?”. They knew they were good at the processing of leather, so they turned to the production of leather goods for cars.

For all the others who failed to survive, we use a term, the "buggy whip maker", which refers to companies that fail to successfully move to the next technological curve.

These are companies that, having invested significant capital and resources (time and effort) in an existing technology, resist to change, believing that the new can’t harm the old. Exactly what happened to Kodak, which while it invented the digital camera, it never proceeded to produce it, considering that it would not replace conventional films (a product that Kodak had also invented).


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