Sidestepping the Competition to Blaze New Trails
It’s usually not possible to defeat every competitor through direct means. No matter how innovative your product or service, others will have already had, if not the same, similar ideas. Competition, while healthy for the business world, is largely dog-eat-dog. The best way to strengthen your brand is to branch out and create new categories.
One of the most famous examples is Chrysler’s minivan. In the early 1980s, Chrysler was a shell of its former self. Far removed from a string of NASCAR victories using its incomparable 426 Hemi engine, it was a sputtering company with very few prospects. Then, in November 1983, it created an entirely new category of vehicle: the minivan. It was smaller than traditional vans, which meant it was better on fuel economy without sacrificing much cargo capacity. That meant that families who needed more than a station wagon or other car could get what they needed without having to buy a large, commercial vehicle that was too much for them. Using the Dodge Caravan as a springboard, Chrysler propelled itself forward for the next 25 years. Chrysler did the same thing in 2009 when it was, again, teetering. They created their first crossover: the Journey. This helped them through their Chapter 11 reorganization.
In the world of the 21st century, such “lateral thinking” is crucial to a company’s success. Survival is no longer simple. If a company is strapped for cash, it can’t just raise prices. Other companies who are more successful can just keep theirs the same and eat into your market share. Lowering prices to increase sales is equally risky. It can lead to an unrelenting price war where no one wins. Improving your product a little at a time can help, but customers might not consider the improvements to be enough for them to spend money on your product or service when other items are “good enough.”
These “lateral moves” must either be different enough from an existing product as to be, for all intents and purposes, new, or they simply must be unique. In the Chrysler example, there were no other minivans in production in 1983. Chrysler’s product was unique. Three decades later, there were plenty of game systems. XBOX developed a method for people to play each other over the internet. XBOX wasn’t unique, but it was different enough to inspire people to get it for the internet capability.
The vast majority of consumers don’t really care about what you make or do, whether or not you’re environmentally conscious, or any of these other “buzzword topics.” They care about two things: saving money and how they feel. To them, how they feel is also more important, in the long run, than saving money. You have to give them a reason to want your new product or service. For example, look at iTunes.
Before iTunes, people had to buy whole albums to get the few songs they wanted. Then, iTunes came along, and charged people $0.99 to buy one song. People loved it. It didn’t matter to them that iTunes’s success signaled the end of musicians earning a real living. They got to spend a buck and get the one song they wanted. Apple created the “why” for those people. In other words, Apple asked them, “Why do you hate buying music?” Then, Apple gave them the answer, “We won’t make you spend $15 on an album. We’ll let you buy one song for $0.99.”
Once you’ve created your new category, you have to market it effectively. Avoid the temptation to “be creative” once you find something that works. Consistency is the key to success. Such consistency brings to mind the old saying: “If it ain’t broke, don’t fix it.” Also, don’t get tied up in “the truth.” People don’t want truth. They want reassurance. Chobani, for example, kept telling all of us that Greek yogurt was better for us. Is it? No, it’s not. But, we believed it anyway because they just kept telling us that it was.
In short, creating a new category isn’t easy. Maintaining market share isn’t easy either. But, the results are well worth the effort when you succeed. Good luck!
