Financial Freedom Series: The new trend of entrepreneurship and wealth creation is no longer market competition

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I have also mentioned in several previous articles that nowadays, to start a business and get rich, what matters more is no longer market competition, but competition in cognition. Think about it: before the internet existed, information asymmetry was the core of the biggest business competition.

Take the simplest example of a farmer selling fruit: a jin of fruit costs however much, and by the time it reaches the city it sells for several times the price. A piece of clothing costs only however much to produce, but once a brand label is attached and it is resold to consumers, it is again several times the price. There are many, many more examples. The essence of all of this is exploiting information asymmetry. Of course, factory-direct sales have also appeared before, eliminating the cost of information asymmetry and giving more to consumers, but in essence there is still no difference.

In the internet era, why can't traditional industries make it? Because the greatest function of the internet is that it has eliminated information asymmetry, enabling nationwide synchronous competition and removing regional information asymmetry. With transparent review systems, it has eliminated information asymmetry in quality. But you might say people still get scammed when buying things online. The internet eliminates information asymmetry to the greatest extent, but not completely. So market competition based on information asymmetry still exists; it is just that the cost of shopping has dropped sharply now, and at the same time it is easier to select product quality. This is also the value of the internet.

So if you want to gain a competitive advantage in the internet era, the path of information asymmetry is definitely a dead end. It will become more and more transparent. Simply put, in the future big data is exactly this direction. So how can you have an advantage and make money in the future?

Think it over carefully, and you may be able to figure it out. Assuming that in the future information is completely transparent and shared, how else can people compete? Product quality? Customer channels? Brand marketing? I believe the business competition of the future is all competition in cognition.

Product quality, customer channels and brand marketing are also a manifestation of information asymmetry. So-called competition based on differences in information can be quantified and can be acquired through taking action. But competition based on differences in cognition cannot be quantified. Can different understandings that people have about the same thing be quantified? Absolutely not.

Therefore, future market competition will definitely be a contest between people, based on their understanding of a matter and their insight into the industry.

And how do you improve your insight into the industry?

"Talent + craft"

Let's not talk about talent, because many people's level of effort does not even reach the point where talent can be compared. Compete on your own craft, not your skill proficiency and accumulated experience, but the cognition derived from rich practical experience behind it.

Think about when Shi Yuzhu started his business, why was he called a marketing genius rarely seen in a century? In essence, it was a difference in cognition. In the era of television, newspapers and magazines, he grasped the core of human nature, and his cognition was one level above that of domestic marketing and advertising people at the time. I won't expand on this here; if you are interested, find his books and read them.

On my official account I have written a lot about the practical cases I have experienced over the years and those experienced by the experts around me, condensing the gains from 11 years of iterative cognition through experience. I won't write too much here, and will simply share two short stories, hoping they can help everyone:

Story 1

Story 2

The degree to which people understand the same thing differently is the key to future market competition. Of course, everything must be judged by results. It is not that having deep cognition alone will make you rich; lacking execution will also prevent you from making money. Most importantly, so-called cognition is inseparable from personal practice.