Who Is Really Best?
Who has the best rent-a-car service? The best cola? The best ketchup? If you are thinking of Hertz, Coca-Cola, and Heinz, you agree with most customers who make these three companies the leaders in their fields. In fact, there is a strong axiom, or belief, in the minds of customers that “the best product or service wins in the marketplace”. After all, this is so logical and so obvious, who could disagree? We could.
There is a paradox in marketing. While everyone believes that the better product will win in the marketplace, the worst possible strategy for any company is to try to produce a “better product.” Why? Because the leader in your field already has the perception of producing the better product. If you try to proclaim that your product is better, the prospect thinks, “no, it can’t be better, otherwise they could be the leader.” Yet, what do most companies try to do? They try to: (a) produce a better product, and (b) communicate that difference to customers and prospects. It is easy to do (a) but it’s almost impossible to do (b).
Is Pepsi cola better tasting than Coca-Cola? Pepsi cola thinks so, and their research shows that prospects prefer the taste Pepsi cola to Coca-Cola by 57% to 43%. That’s a pretty big difference. Yet Pepsi cola has only 10% of the global market share while Coca-Cola has 46.5 percent. What they need to do, you might be thinking, is to communicate that difference. Well, they’ve tried, and it doesn’t work: prospects do easily conclude: “If Pepsi cola was better tasting, they would be the leader, not Coke. There must be something wrong with the research.”
What’s Important: Who’s The First?
It’s my perception that 90+% of all marketing programs are based on communicating the essence of the better product or service. Unless you are already the leader, these programs are bound to fail because the prospect assumes that the leader must have the better product or service. But how did the leader achieve its leadership? Not by introducing a better product or service; invariably, the leader in the category got to be the leader by being the first brand in the category.
Companies such as Dangote Industries Limited, BUA Industries, Transcorp Holdings, Zenith Bank, MTN, etc. are all recognized in their respective fields. Some consultants have called this leadership phenomenon “the first mover advantage,” but that is not so. It’s an advantage, but it’s not the reason that most leader brands were first in their categories. It’s the “first minder” advantage. That is, the brand that gets into the mind first is the winner, not the brand that is the first in the category. You don’t win in the marketplace. You win in the mind.
If you weren’t the first in your category and you can’t win by being better, what can you do? The answer is obvious: start a new category you can be the first in. Marketing is more a battle of categories than it is a battle of products. Winning companies think category first and product second. They try to categorize what they do, not in terms of being better, but in terms of being different.
Before you launch (or re-launch) a new product or service, ask yourself the following questions:
- What is the name of the category? Not a name you might like, but a name the industry gives the category.
- What is the brand name of the leader in the category? Not necessarily the sales leader, but the brand that customers perceive to be the leader.
- If there is no dominant brand, or at least not a dominant brand in the mind of most prospects, jump right in with your product or service and try to quickly establish your leadership. Cut prices, cut deals, hire sales people, launch massive publicity campaigns, do everything you can to seize the leadership position before someone else does.
- Promote your brand as the leading brand. “In your own interest,” says Zenith Bank, “no wonder it is number one.” Leave no piece of paper or web site, or TV advertisement or radio commercial without mentioning your leadership. Leadership is the most important aspect of any marketing program. Why? Prospects assume the better product or service will win in the marketplace. Therefore, if you are the leader, you must have the better product.
- If there is a dominant brand, then move on and establish a new category you can be first in. But make sure you have a new name to match the new category. You can get into serious trouble if you try to use an existing name.
- You can’t dictate the category name. Only the industry and the media can that. Therefore you have to launch your new brand with publicity and get the media to establish the category name for you.
Marketing is not a battle of products. Marketing is a battle of perceptions. And to win the battle of perceptions, you have to be the leader in a category. Prospects assume the leader must be better because “everybody knows the better product or service will win the marketplace.” How do you become the leader? You launch a new category you can be first in. It doesn’t have to be a big technological advance. Sometimes the simple ideas are the easiest to get into your mind. And where do you win the battle? You win the battle inside the mind of the prospect.
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