Tough Times for Leaders of the Pack - BusinessWeek

Under "Stock Talk" in the Up Front section of the January 30, 2006 edition of BusinessWeek , there appears an item entitled "Tough Times for Leaders of the Pack." Consultants at Marakon Associates did some research on shareholder return among market leaders and came to what is obviously a newsworthy conclusion.

"In analyzing 3,260 public companies, Marakon's Brian Burwell and Jeremy Sicklick discovered that between 1999 and 2004, the median total shareholder return was 1.8% for market leaders vs. 9.5% for non-leaders. What gives?" Here are two people who did not read Richard Miniter's book The Myth of Market Share. The conclusions they draw as reported in this small item are rather insubstanial, with the exception of pointing out that many mergers and acquisitions did not produce the gains expected over the last five years. Burwell sums it up with this observation, "Serving large numbers of customers is less of an advantage today than it was 10 years ago." A concept that might be true but is highly unlikely to be embraced by any business.