A single-serving bottle of Coca-Cola is available from any convenience store for about 1 dollar. The ingredients inside and the bottle itself cost about 2.5 cents. In other words, combining the ingredients with a brand name and an image creates a 4,000 percent price markup on a simple product that can be produced by anyone. Globally, this product sells 1.8 billion bottles each year—generating enough revenue to sustain a major global corporation, even without all of the other products the company sells. A competitor seeking to capitalize on the global appetite for this type of beverage could invest billions of dollars creating manufacturing and distribution capabilities. Or a single creative entrepreneur could paint a photorealistic replica of the product, and that painting could eventually sell for $57 million and trigger the birth of an entirely new modern art movement. Who is the better businessman, then—the inventor of the soft drink, its many imitators, or the artist who makes an identical copy that can never be consumed?
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Volume 59, Issue 4, July-August 2016
Innovation for Innovators