Make Your Brand Play Second Fiddle

What happens when you put the cart before the horse?

If you are lucky, the horse just laughs at you. If you are not, the horse may kick at an awkward angle and the proverbial ball may not be in your court!

Most start-ups do the same thing with similar calamitous consequences for their brands. They believe the secret to winning is launching a new brand in an existing category. They are part of the ‘better products win’ brigade. A handful may succeed too. Never mind the exorbitant cost they pay for it or the enormous luck they may be blessed with.

The smart ones realize the cardinal principle of winning in marketing is in not searching for a new brand but for a new category. You see, opportunity does not lie in brands. It lies in creating categories. In the mad rush to build brands, the smartness in building a new category is often overlooked.

Paper Boat was not just a new brand. It created a new category.

Netflix was not just a new brand. It opened a new category.

Maggie was not just a new brand. It formed a new category.

Paper Boat, Netflix, Maggi et al fashioned new categories and were the first to enter them. Thus, they reaped enormous strategic advantages. For starters, there was no other brand to compare them with. They started running the race alone. Any athlete would tell you the power of a good head start. It gives time to enter the customers’ mind. It helps build a sizeable market lead. Importantly, it gives the brand the luxury of making mistakes and still get away with it!

They say it’s lonely at the top. When you create a category and start running, it’s pretty much lonely at the start too!

More than many research has clearly pointed out to an indisputable fact. Category creators experience faster growth. They receive much higher valuations from investors than businesses that bring only incremental innovations to the market.

Customers think categories first and then talk brands. You decide to have coffee first. Then look around to figure out which restaurant brand to have it from. You decide to watch a movie first. Then wonder which one to watch. You decide to marry first. Then search for the matrimonial site you need to register in.

Al Ries and Laura Ries put it so very eloquently in their book ‘The Origin Of Brands. ‘Imagine shopping at a grocery store that doesn’t have any signs pointing you in the right direction. Odds are you’d spend a lot of time wandering the aisles until you found what you

needed. People want a sense of direction when they’re shopping, and they want to see their options grouped together – whether that’s kitchen tools, breakfast cereals, or winter coats. One way to do this is with product categories.’

In spite of the power of searching for a new category to create than of looking for a new brand to launch, why do most start-up wannabes don’t see this inevitable market truth?

Blame it on research!

Rather, on the erroneous understanding of what the customer says in research. When probed about choices, the consumer articulates her needs in terms of brands. Not in terms of categories. When asked what would they prefer to make in the kitchen when they don’t have much time, they would say Maggi, not noodles. They are just using the brand name to represent what they want. Sadly, marketers interpret it otherwise.

Put simply, categories first, brands next. That’s the path to take in the new product development game. When you are the first to create and enter a category, the consumer sees you first. Buys you first. And makes you first!

Satheesh Krishnamurthy

Brand Consultant, Columnist and Coach

Website – satheeshkrishnamurthy.com