Book Summary Eating the Big Fish: How Challenger Brands Compete against Brand Leaders by Adam Morgan

(John Wiley & Sons, 2009) Challenging the Big Fish The big fish is already top of mind, because he owns the largest share of the market. Inertia will not only keep him in first place, it will grow his share of the market. You cannot outspend him, and you cannot beat him at his marketing/communication game. If you cannot be the market share leader, you must strive to be the mindshare leader. The war for mindshare is won through thought leadership, not through traditional advertising or marketing. Ideas specifically those that add value are the currency that funds growth. Challenger brands can win significant market share from brand leaders by winning mindshare. Challenger brands share three attributes: a state of market, a state of mind, and a rate of success. 1. State of Market: They are not the number one brands, nor are they niche players. 2. State of Mind: They have ambitions that exceed their conventional marketing resources, and they are prepared to accept the marketing implications of that gap 3. Rate of Success: They are succeeding, not merely ambitious or arrogant Lessons learned from a challenger brands success are applicable to any situation, regardless of market. The First Credo: Intelligent Naivety Successful challengers: 1. Dramatically simplify choice for the consumer 2. Create a new criterion for choice in the category (this is how they accomplish step one) 3. Give consumers a new way of thinking and feeling about the category Challenger brands deliberately break with their own immediate past (if they have one) they intentionally reinvent key aspects of themselves in order to force rapid reappraisal from the consumer. They put everything in play by asking what is genuinely still relevant to their future, freeing themselves to focus on the questions and possibilities that will make the difference between being a Challenger brand and being an establishment brand. This requires that challengers adopt a position of Intelligent Naivety, which has four purposes: 1. To establish afresh the core issue facing the brand or the company (the Big Fish); taking a step back and more accurately defining the problem 2. To help define, therefore, what business we should really be in 3. To free ourselves to see all the possibilities of the category 4. To allow us to see what we may need to break with from the past to enable a stronger future

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The range of potential challenges that we can make lie in one of the following: Challenging some fundamental dimension or driver of our category Challenging some aspect of the way the consumer shops for, experiences, or consumes our product Challenging the culture surrounding the category Challenging some broader aspect of contemporary culture Challenging some dimension or quality of the competition/Market Leader So one way to see this challenge is to ask ourselves very simply: What is the category orthodoxy that we reject? What do we think is wrong, or what will we have to break (i.e., prove wrong) in order to succeed? And as we explore it, the way the category currently thinks usually yields a very rich variety of potential sources of challenge. Some Challengers, then, have been very explicit about creating monster that they then oppose. The Second Credo: Build a Lighthouse Identity Success as a Challenger comes through developing a very clear sense of who or what you are as a brand/business and why and then projecting that identity intensely, consistently, and saliently, like a lighthouse, so that consumers notice you (and know where you stand) even if they are not looking for you. Goods have always been a form of communication to the outside world and to oneself. But todays brands have surpassed goods, becoming a more than a form of communication but of navigation. The brands that flourish today are those that have a very clear sense of who they are that is to say, not simply a distinctive identity but a strong and self-referential identity; they stand out from the competition by their intensity and their confidence in themselves. In life, people are drawn to strength and to people of character who are true to themselves. In marketing life, in using goods as communication or even navigation, people are drawn to l strong brands. This strength can come from the familiarity and ubiquity of a Brand Leader as Number One; if you are a second-rank brand, it comes from an intense projection of who you are. Key elements of Lighthouse brands: 1. Point of view: They have a very particular take on how they see the worlds. The predominant purpose of their marketing is to tell us where they stand. They offer an emotionally based point of view about the world. They don't attempt to tell us something about ourselves, and they certainly don't attempt to navigate themselves with reference to us. 2. Intensity: They offer an intense projection of who they are in everything they do. Challengers need to be vivid. 3. Salience: They are highly intrusive; one cannot avoid noticing their activity even if not actively looking in their direction (or shopping their category). 4. Built on Rock: Their identity is built on a product or brand truth that is inarguable. A Challenger brand does not break through in a mature category by being more convenient or trustworthy; it succeeds because it offers the consumer an emotional reward and/or relationship that the Establishment brand cannot match. They invite a realignment of the

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consumer's emotions. The Challenger brand must possess a stronger, emotionally based relationship with the consumer than the Brand Leader. Brands that enjoy an iconic status in consumers' minds are overengineered. They offer not just product performance but product overperformance, by offering the consumer dramatically superior performance on some dimension chosen by the Challenger. A Lighthouse Identity defines not only the brand, but also what business the brand is really in. For mature brands, the role of brand planning is not to add value, but to extract value to find and amplify a part of the brand's history and essence whose relevance and initial power has been lost sight of. In many cases, our brand will have developed a very clear identity among a small group of hard-core users or early adopters because these users have found or projected something onto the brand from the context in which they have come to know it. The drive for an identity as a foundation for all other activity must be a credo something one believes in and actively moves toward. The Third Credo: Take Thought Leadership of the Category There are two Brand Leaders in every category: the Market Leader (the brand with the biggest share and the biggest distribution) and the Thought Leader (the brand that everyone is talking about, that has the highest "sensed momentum" in the consumer's mind). The rules or conventions that govern marketing of a product often have little to do with understanding what the consumer really wants or might want. Research often confirms the validity of these conventions, because it asks questions that presuppose the same old answers, and the consumer has never really seen what else might be on offer. There are six kinds of conventions that surround any category: Conventions of Representation. How you portray yourself. Conventions of Medium. Where consumers come across you. Conventions of Product Performance. What your product actually does. Conventions of Product / Service Experience. What you offer beyond talk or technical performance. Conventions of Neighborhood and Network. The company you keep (that makes you strong). Conventions of Relationship. Breaking the plane.

Thought Leaders must break these conventions by getting us to look at the category in a fresh way. They must "educate" consumers (or stimulate them to reeducate themselves) to think that there is a whole new criterion for choice in the market other than the ones the Market Leader has been teaching them tor years. Eurostars Greg Nugent says Thought Leadership is not just a means of generating publicity as a shortcut to the future a perceptual bridge to where you would like to be positioned. Challenger brands may break the convention of neighborhoods and networks by partnering with another brand, another organization, a different network, or our user community itself.

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Usually the primary role of the strategic alliance or community is leverage, authority, distribution, or source of content creation for the better realization of the brand's potential or its core purpose. The Challenger must understand which conventions of representation, medium, or experience to break and which to observe. There is a real risk that the consumer may be confused by the change of convention, particularly if it is one they have become comfortable with. Thought leadership through unconventional practice does not imply a forfeit of conventionally desired attributes, like quality ratings the whole nature of what quality does and does not mean is shifting dynamically under our feet. ReThe Fourth Credo: Create Symbols of Re- evaluation Successful Challengers are brands in a hurry: they must puncture the consumer's autopilot and create reappraisal of themselves and their category swiftly and powerfully. To do so, they create big, impactful acts or marketing ideas that capture the indifferent consumer's imagination and bring about a rapid re-evaluation of their image, and their role in the consumer's life. Challengers must look for ways to create Symbols of Re-evaluation dramatic acts, often involving startling juxtapositions, that prompt consumers to sit up and rethink some of their assumptions about the category, the brand, and how they are thinking and behaving in relation to both. Challengers communicate emotion. Challengers have a sharp hunger for symbols and iconography symbols of change. Within each market there one dominant complacency or habit that is the central departure point for many other accompanying attitudes. A frequent strategic route for Challengers involves surprise-attacking the dominant complacency head-on. Challengers juxtapose things you wouldn't expect to find together and demand that you reevaluate your position on one of the pair. These symbols are strategically introduced, They may be created as part of the long-term marketing or remarketing of the company, or (more dramatically) strategically stolen from the establishment player you are challenging. The Fifth Credo: Sacrifice Because Challengers have fewer resources than do Big Fish, what they choose to sacrifice is as important to their success as what they choose to do. To create a strong preference, Challengers need to reach out and bind themselves to certain groups of people. These actions or behaviors will probably leave other groups cold. The abyss between the many different messages a company would like to communicate, and the single-minded simplicity that it takes to stand out is the one that most marketers find hardest to bridge.

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The difference between Sacrifice and prioritization is that the latter allows secondary and tertiary targets. Sacrifice means not doing these secondary and tertiary things at all. Sacrifice concentrates the internal and external expressions of identity by eliminating activities that might dilute it. 2. Sacrifice allows the creation of strong points of difference by changing the organizations mind-set from pursuing weak universal appeal to a more intense, narrower appeal. 3. Sacrifice generates critical mass for the communication of that identity and those differences by stripping away other secondary marketing activity, maximizing the Challenger's consumer presence, given its more limited marketing resources. The Sixth Credo: Overcommit Deciding to Sacrifice many activities for one or two key activities implies that these few activities must be successful. This requires Overcommitment. Overcommitment implies thinking about barriers and actively removing them before they occur. Its easy to identify the one or two things that have made most of the difference to our business's success, but its harder to anticipate them and overcommit to them. Customers are not fooled by good intentions, mission statements, or customer-satisfaction programs, because their world hasnt been changed by these things; the only way to translate intention into behavior if everything hangs on the outcome is to Overcommit. One way to accomplish overcommitment, is to identify three irrefutable reasons why each core marketing task will fail (or be diluted into mediocrity) and then brainstorm the most effective way of neutralizing or reversing each of them. Another way is to ask oneself the same question in three different ways: (1) How should we ensure this activity succeeds? (2) How would we approach ensuring that success if our career depended on it? And (3) how would we approach it if it was our business, we were down to $300 in the bank, and our family's livelihood depended on it? (based on the story of Jannard, founder of Oakley) The Seventh Credo: Using Communications and Publicity to Enter Social Culture Successful Challengers treat communication ideas and publicity as high-leverage assets, and systematically embrace them as such within the company. Brand Leaders must protect what they already have gained, and therefore avoid alienating the broad mass market with bold advertising or publicity-generating activities. Marketers tend to think of consumer needs in terms of their needs only in the context of their potential to consume our products. But people are not consumers, they are simply people who some-times buy things. They have broader social needs: they need to be able to interact healthily with their peer groups, in ways that make them happy social animals. 1.

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People share brand ideas or brand news usually because they find themselves in one of five situations regarding a brand. 1. Bragging rights, being on the pulse: They have the sense that they have discovered something valuable, something that makes them feel, and seem to their peers, slightly ahead of the pack. Product enthusiasm: They have come across an aspect of product performance about a brand that is startlingly impressive. Aspirational identification. They have found a brand with a strong identity and ethos (perhaps through its authenticity or because it aligns itself to certain social issues, for instance), which they admire or would like to be identified with. News value. They have come across a piece of marketing activity that has surprised, strongly entertained, or shocked them sufficiently to prompt conversation with their peer group. Creative fingerprint. They have found or made something that is of valuable enough social currency to be passed on, the value of this clearly being enhanced by adding to it their own creative fingerprint.

2. 3.

4.

5.

While brand equity may be defined as the perceptions or facts a consumer associates with the brand when probed, mythology may be defined as those perceptions or facts a consumer proactively communicates, unasked, about the brand. Folklore is active, social, and self-propagating. lt is like a virus of favorable equity that gets passed on among existing and potential user groups. At the times of their strongest momentum, Challengers live at a level above Brand Leaders, because while Brand Leaders enjoy strong equity, Challengers enjoy a strong folklore either at an iconic level through the brands advertising and marketing, making it a reference point in popular culture, or through ground-level word of mouth. Social salience allows a Challenger Brand to punch above its media weight. Adopting a binary approach has several critical advantages: If a Challenger's key task is to radically simplify choice, and consumers have a bewildering range of choices available to them, getting that choice down to two options is a very strong approach. Raising awareness that there is, in fact, a choice to be made, rather than unthinkingly continuing to do the same thing, prompts reconsideration. It allows you to redefine the criteria for choice. Having another surface" helps sharply define your own virtues (not simply your product benefits). You may lure competitors into a response such that they spend their marketing dollars talking about your brand, and the issue you would like consumers to consider. And it can be to your advantage to raise interest in the category as a whole (cola wars). Challenging the Establishment brand seems to work best when: It is clever and/or witty, rather than simply rude. We need to emotionally engage a broader community rather than to simply dismiss the opposition. It has a positive value about the underdog to communicate rather than merely negatively knocking the competition. It represents the championing of something worth having instead. It has substance behind it. In effect, then, it is not just a war of words: There is something real to be gained for the consumer by going with us.

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It is therefore on the consumer's side, rather than its own side: The consumer wins if we win. It creates conversation and sets the agenda.

The Eighth Credo: Become Idea-Centered, Not Consumer-Centered Momentum is vital to Challengers for two reasons. Actual momentum is the source of the return on investment and as such, the measure of immediate growth in sales and revenue return, Perceived momentum the sense the consumer has that this is the brand making the running in the category, that this is a brand to watch is the basis of its future equity, the seeds, perhaps, of a future return on investment that will out- strip today's. Challengers lose momentum because they fail to realize that they have to change in order to remain the same not their core identity, but the way the consumer experiences and is stimulated by that identity. The underlying driver for a Challenger is momentum the sense that our brand is making the running in the category. Successful Challenger brands can therefore never afford to be static. They constantly add to themselves to keep ahead of the market in their relationship with the consumer; and the fuel for that movement is ideas. Failure to sustain actual momentum leads to the temptation to grow volume instead by accepting the potentially poisoned chalices of line extension or distribution; with these may come erosion of the core, equity, loss of the core users, and an erosion of the shape of the user base, leading to a relatively rapid decline. Challenger ideas do not tend to come out of the R&D department; they come out of the core marketing team, or an enthusiastic customer, or anyone who happens to be passing the founders office and they tend not to be product ideas but marketing ideas: very ambitious marketing ideas that will provoke and stimulate the consumer's imagination. Consumers cannot tell you what the next, fresh, stimulating idea will be, but your understanding of the consumer will give you that visceral confidence to innovate in the right direction. While Brand Leaders offer the consumer a sense of belonging, being a part of a community, Challengers offer the ability to individualize, to be a part of something different, perhaps ahead of the curve. Some Challengers build multiple access points as they grow. This is more like line renewal than line extension. Extension offers the same relationship with the consumer, expressed in other product forms, while line renewal attempts to renew the relationship by offering the same, but different. There are four elements to the line renewal strategy: 1. The continual use of ideas rather than simply communication 2. The construction of new facets or embodiments of the brand, offering fresh departure platforms for such ideas and at the same time differentiated points of access 3. The creation of fresh ways of thinking about the brand's identity at each of these new points of access 4. And, in terms of implementation, doing this systematically and consistently

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