(Roughly) Daily

Let’s imagine we’re on a beach that’s a mile long, and on that beach there are a couple of ice cream carts…

Let’s also imagine that the ice cream sold at each cart is identical in quality and cost, so the only reason customers choose one cart over the other is when one cart is closer. Given all of that, the best location of the carts is with each cart halfway between the middle of the beach and one of the ends. In this arrangement each cart gets 50% of the customers, and no one has to walk more than 1/4 mile to get some ice cream.

But what if one of the ice cream vendors decides to move their cart a bit closer to the middle of the beach…

They are now the ice cream cart of choice for a bigger segment of the beach, and will get more business. The other ice cream cart has no choice but to retaliate…

Now once again they each serve the same percentage of the beach-going public. Since any further movement by either cart would mean a loss of business for that cart, they end up permanently side by side, in the middle of the beach, even though this is a less optimal location for their customers.

That is a simple example of something called Hotelling’s law; the tendency of competing products to end up as similar as possible…

“Producers of products and services tend to make their products and services as similar as possible to those of their competitors.”  From The Laws of the Universe, the story of Hotelling’s Law.

* Petrarch

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As we nose around for niches, we might send ambitious birthday greetings to Count Giovanni Pico della Mirandola; he was born on this date in 1463.  An Italian philosopher, he undertook, in 1486, at the age of 23, to defend 900 theses on religion, philosophy, natural philosophy and magic against all comers, in the process of which he wrote his famous Oration on the Dignity of Man, which has been called the “Manifesto of the Renaissance”; a revitalization of Neo-Platonism, it was a seminal text of Renaissance humanism and of what has been called the “Hermetic Reformation.”

Pico’s portrait, from the Uffizi Gallery in Florence

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