1/ Whenever there is a market fad/phenomena with low or no barriers and a flood of entrants—the best strategy is often: Be the arms dealer.
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No debate about value to consumers. Same for yogurt. It’s delicious. Just would prefer to be high probability agnostic arms dealer than having to raise and spend on marketing and race for share A product is not a biz is not an investment.
Sure. I'm disputing the notion this is necessarily a fad. It may be - most things are - but that's calling it early. As to what makes good investment strategy here, I haven't thought about it, you may be right. No idea if a company can build a moat.
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Agree. I don’t mean “fad” as transient phenomena like pet rock or fidget spinner or even Pokémon go—but as phenomena/craze. Those yogurt chains persist (thankfully, yum!) But competition has cornered growth or hurt economics.
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Curious: why do you think the manufacturers will hold the power, rather than the owner of the brand users connect to? In airline industry, seems to be manufacturers. But in ride share, it's the brand users connect to. [cont]
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