── ── Strategy
Death Spiral
A death spiral is a self-reinforcing negative feedback loop in competitive markets. Unlike ordinary decline — which is linear and potentially reversible — a death spiral is non-linear: each deterioration step actively causes the next to be worse and faster. The cycle begins when a competitor breaches a company's primary moat, then propagates through share loss → revenue decline →…
How it works
Step 1 — Audit moat dimensions: Name 3–5 advantages (network effects, switching costs, data, brand, distribution, patents). Rate each: strength (strong/moderate/weak) + trend (stable/eroding/rapidly eroding).
Step 2 — Identify breach conditions: For each moat, name the specific competitor action or tech shift that would establish a durable advantage over it.
Step 3 — Check early-warning signals: Multi-quarter share decline? Rising CAC? Rising churn? Any confirmed = spiral may have started.
When to use it
- user says 'we're losing market share,' 'our growth keeps slowing and I don't know why,' 'a competitor is gaining on us fast,' 'what's the worst-case trajectory here,' or a business shows two or more consecutive quarters of declining key metrics with no identified reversal mechanism
When not to use it
When the decision is routine and reversible, applying a formal method costs more than it returns.
Worked example
Kodak's Death Spiral (1994–2012)
Kodak's moat in the 1980s was among the most formidable in consumer markets: proprietary chemistry for film and paper (technology moat), a massive global distribution network through pharmacies, photo labs, and retailers (distribution moat), and brand trust so deep that "Kodak moment" had become a cultural idiom (brand moat).
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npx skills add deciqAI/knowledge-skills