Brands that hold the supremacy in the market they activate, are a distinct typology. They have other communication rules, other challenges and other pitfalls.
This category includes both the boutiques with a monopoly on their area, the category “mammoths” ignoring the small competition, and generally the #1 brand on a particular segment. So, whether it’s an old and steady market, a new and emerging one or a niche, I will further refer to them as market leaders.
The most powerful trap of market leaders is to loosen up. A great temptation when you’re up there, and No.2 is not visibly approaching you, is to … do anything. Just relax and savor the victory.
Many times, being #1 is not the most comfortable place to be, since you have no reference points. And racing by yourself won’t make you the fastest runner.
Another major inconvenience #1s are facing is the level of exigencies. Both from the consumer and business perspective, expectations are high. Consumers are more demanding, and also more sensitive to price changes. While from a business perspective, the big brands usually have larger structures and thus the costs are accordingly.
Returning to the title question, what do brands do when there is nothing left to do? When it seems that all indicators are “up in the sky”? When awareness level is close to 100% and when you’re the first choice within the category?
The managers of these brands often face the pressure to increase EBIT margins, because undoubtedly, maintaining the profit level is never enough, even though that alone is not easy to accomplish. In such cases, the first intention is to decrease operating cost, but such measure reflects in the quality of the products and services. Therefore, reducing costs will obviously affect both brand equity and sales volume.
Here are some questions which can sweep away a market leader’s apathy:
Do I really have a strong emotional relationship with my consumers?
When you’re the leader, it is essential to ask yourself: what is the level of consumer affinity towards my brand? In what ways have I earned my loyalty? Do my consumers have a functional relationship or a close emotional connection with my brand?
If the supremacy of the brand is based on purely rational reasons, there is a problem. From a seemingly comfortable position, my “worthy brand” is in fact on a vulnerable position.
Which is to say: if the consumers are staying with you because they have no choice, since you’re an undeniable option (in terms of price, availability, even product quality), then they are likely to “run away” with the first viable alternative. A necessity relationship can only be translated in frustration, spite or even hate (e.g. the monopoly of energy suppliers or banking).
If you managed to reach the top, you have no choice but to make yourself loved by your customers. You cannot just stay up there, impassive and cold, because that way you’re sure to build a void between the brand and the consumers.
How inflexible is the brand image?
The market leader is the one defining the identity of the category. Energy drinks are about adrenaline because Red Bull is about extreme sports. Batteries are about long lasting power because Duracell in about restless bunnies.
The image of a brand is like a story. Except brand whose image is built on tradition (who can afford the luxury to ignore the latest trends), a brand’s story needs to be interactive, to dialogue with those to whom is addressed. At the same time and above all, a brand’s image must be coherent.
Here is a challenge to any brand: be yourself but be trendy.
Managing to be alive and fresh is a challenge for any brand, but market leaders have a few more obstacles, because they have a stronger “themselves”.
Usually, it is difficult (but possible) to attach into a brand’s image an attribute that does not belong to the category. For instance, it’s hard to express relaxation when you are a bank, modernity when you are a museum or ecology when you’re an automobile.
However, it is feasible to say you are more relaxed than others or environmentally friendlier than others. For a market leader, “the others” are less relevant.
How and in what direction can the market grow?
What’s to do when you’re the one selling most of the oranges in a country? Let’s say you have the best price and an excellent distribution and everybody knows how delicious are your oranges. Say that one year you have a great harvest of oranges. What’s to do with the extra?
In a similar situation in the early 1900s, Albert Lasker, one of the six giants of advertising (so called by David Ogilvy), “invented” the orange juice. It is said that until then, oranges were mostly consumed as such, and by promoting juice consumption sales topped over. For is it not? A glass accommodates 2 or 3 oranges. At such a growth, we should also add the new consumers, recently attracted by the new way of consumption.
This story illustrates one way to grow a market. However, there are many other models for growing a market.
A few of them are:
– Increasing the frequency of consumption (e.g. from a vacation per year to several city breaks a year);
– Inventing new consumption occasions (e.g. gifting);
– Educating non-users (e.g. sampling, placing a niche product in a familiar setting à such as using notorious culinary shows for promoting exotic spices / dishes);
– Competing related categories (detailed below).
About competing related categories:
A market can also grow because of the consumer migration from one category to another. By aiming a change in consumer behavior generated by substitution with a similar product, you can increase the market share by attracting new consumers. Coming back to the above example, orange juice can be a substitute for both lemonade or apple juice but also coffee or breakfast…
For example if you manage a brand of bread (the category leader), it is desirable to know and understand consumer behavior regarding homemade bread, corn flour, diet crackers or specialties such as foccacia (regardless of how insignificant is the market share). In other words, it’s important to see „the big picture” to know where you stand and what are the growth opportunities.
Why go through all that trouble?
Because a leader is always under the pressure to innovate. It is expected from a market leader to expand the product range, variety, quantity, quality, consumer experience and so on.
Because who is he who does not want growth? Even from the “cozy” leadership position.
For that, the „battle” never ends.