22 Unchanges Laws of Marketing
Introduce to you
Billions of dollars wasted on marketing programs that don’t work,
it’s not a matter of wisdom,
insight,
or great funds.
Many managers assume that a well-crafted,
well-executed,
well-funded marketing program will be successful.
That’s not necessarily the case.
And you’re not looking for distant examples,
but companies like IBM,
General Motors,
and Sears Roebuck.
GM’s program managers must be the best and brightest.
Naturally,
the best
and brightest have attracted the biggest
and best companies like GM and IBM.
But the programs themselves were based on unfounded assumptions.
When asked what he believes in America’s feeling about big corporations,
John Keneth Galbraith said that
we fear the power of corporations.
Today,
we must say we fear the incompetence of companies.
All companies are in trouble,
especially the big ones.
General Motors is a prime example.
Over the past decade,
the company has paid a terrible price for the destruction of their brand
(it costs the company just
as much as it cost the brand to create).
Shares that have lost 10 points is a loss of $10 billion in sales a year.
GM’s problem is not a problem of competition,
even though the level of competition has increased.
It’s not a matter of quality either,
even though GM doesn’t offer exceptional quality.
It’s certainly a matter of marketing.
Today, when a company makes a mistake,
the mistake is right behind them,
it is the competition with their business.
To get back into business,
that company must wait for other companies to make mistakes
and find a way to exploit the situation.
So, how to avoid confusion in the first place?
The answer is that your marketing program must conform
to the laws of marketing
(although we define our ideas
and concepts under the banner “marketing”,
it helps no matter where you are in the company,
or whatever your products and services are selling).
What are these marketing laws?
And who brought them down from the top of Mount Sinai
and carved them in stone?
The basic laws of marketing are the ones described in this book.
But who said this?
How did two guys from Connecticut find out while the others ignored it?
After all, there are many savvy marketers and academics.
Why do they ignore what we think is obvious?
Simple answer.
We can say,
but most people are not willing to confirm
that there are laws on marketing,
the only thing that can be certain is
that these laws are irreplaceable.
There are laws of nature,
so why can’t there be laws of marketing?
You can make a perfect airplane,
which will look great,
but it won’t take off until it obeys the laws of physics,
especially the laws of gravity.
You can build an architectural masterpiece on a sand dune,
but the first storm will wipe out your creation overnight.
Thus, you can plan an excellent marketing program,
but only one of the laws of marketing can harm it
if you do not know what the laws are.
Maybe it’s human nature not to admit that
there are things that we can’t do.
Certainly most marketers believe anything
It can be achieved if you have enough energy,
creativity or determination.
Especially if you’re willing to spend enough money.
Once you admit there are laws about marketing,
it’s easy to see what those are.
It’s so obvious.
We’ve been studying for over 25 years what works
and what doesn’t in marketing.
We have found that programs that
work are almost always in tune
the fundamental laws that affect the market.
We have analyzed the principles of marketing in detail
through our books,
articles,
and presentations.
We have also developed strategic patterns in the marketing process,
including a natural model of human intelligence that
we popularized under the concept of “position”.
We have also developed a sample of the military market,
where companies and brands are positioned in offensive,
defensive ambush or guerrilla positions in marketing warfare.
After years of working with marketing principles and issues,
we have codified the basic laws that
guarantee success or failure in the marketplace.
We call these the irreplaceable laws of marketing,
22 in all.
Violation of these,
risk will come to you.
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Rule 1. The Law of Leadership
Leading position or better position?
A lot of people believe that
the basic problem in marketing is
how to convince prospective customers that you have a better product or service.
This is not correct.
If you share a small market and you have to compete with larger,
better-funded competitors,
your marketing strategy is likely to fail in the first place.
You have violated the first marketing law.
The basic problem in marketing is to create a category that
you are the first in this field.
That is the “law of leadership”.
The leading position is still better than the better position.
It’s easier to come to mind first than to convince yourself
that you have a better product than someone else’s product that
It has already been introduced.
You can present the Law of Leadership by asking yourself two questions:
1. Who was the first person to fly solo across the Atlantic Ocean?
Charles Lindbergh, right?
2. Who was the second person to fly solo across the Atlantic Ocean?
It’s not easy to answer.
The second person to fly solo across the Atlantic Ocean was Bert Hinkler.
Bert is a better pilot than Charlie:
he flies faster use less fuel.
However, who had ever heard of Bert Hinkler
(Bert had run away from home
and Mrs. Hinkler had not heard from him since then).
Although Lindbergh was a pioneer,
most companies have followed Bert Hinkler’s path.
They wait until the market is tapped.
Then jump in with a better product,
often with your own name on it.
In today’s competitive landscape a similar product
with a new name has little hope of becoming a large
and profitable brand
(Chapter 12: Law of Expansion).
The leading brand in any product category is always the first brand in the mind
of the prospective customer.
Hertz in car rental, IBM in computing,
Coca-Cola in beverage…
After World War II. Heineken was the first imported beer
to make a name for itself in the US.
Four decades later,
what is the first-class imported beer?
Is it the best tasting beer or is it Heineken beer?
There are 425 brands of beer imported and sold in the US.
Surely one of these brands must taste better than Heineken.
But is that really the problem?
Today, Hemeken is still the number one imported beer,
with 30% of the market.
The first domestic light beer was Mliler Lite.
So what is the most popular light beer in America today?
Is it the beer that tastes the best or the beer that
enters the consumer’s mind first.
However, not everything that goes first becomes successful.
Your first position may be too late.
For example,
“USA Today” was the first national newspaper,
but it did not appear to be a success.
The newspaper lost a total of $800 million and has never made a profit.
In the age of television,
it may be too late for a national newspaper.
Many of the firsts were too bad to go anywhere.
Frosty Paws,
the first ice cream for… dogs,
was unsuccessful.
Dogs love this ice cream,
but their owners are the ones paying for it,
and of course,
they think dogs don’t need a special cream for them.
They are still happy even just Lick the ice cream.
The law of leadership applies to any product,
brand,
category or sector.
For example,
you do not know the name of the first university founded in the United States.
You can always guess right
by replacing the leading word with the first.
So what is the name of America’s leading university?
Most people would say Harvard,
which is also the name of the first university founded in the United States.
(What is the name of the second university founded in the US?
College of William & Mary.
Many people don’t know
because it’s only slightly more famous than Bert Hinkler).
No two products are more alike than twins.
Yet twins often complain that people always like the person they meet first,
even though they also know the other.
People tend to stick with what they already have.
If you meet someone more than your spouse,
that’s really wrong.
If you do change,
think about attorney fees,
child division,
and property division.
The law of leadership also applies to journals.
That’s why “Time” magazine is ranked in “newsweek” magazine;
“People” on “Us”
and “Playboy” before “Penhouse”.
Take the magazine “TV Guide” for example.
In the early 1950s,
Curtis Publishing Company tried to put “Television Listings Magazine” in competition
with the fledgling magazine “TV Guide”.
Although “TV Guide” was just starting out weakly,
and Curtis had considerable strength,
Curtis publisher never really took off
because the market for “TV Guide” was already established.
The leading law applies equally to products ranging from solids like cars
and computers to soft ones like universities and alcohol.
“Jeep” is the first two-wheeler;
“Acura” is 1st luxury of Japan;
“IBM” was the first company to build a high-powered mainframe computer; “Sun
Microsystems” was the first company to manufacture office computers. “Jeep”,
“Acura”,
“IBM” and “Sun” are all leading brands.
Chrysler was the company that introduced the first small passenger car.
Today, Chrysler has 10% of the auto market
and 50% of the small passenger car market.
So is it necessary for the car market to make better cars or dominate the market first?
The Hewlett-Packard Computer Company was the first
to introduce the laser printer.
Today the company has 5% of the personal computer market
and 45% of the laser printer market.
Gillette was the company that introduced the first safety razor blade.
Tide was the first laundry detergent brand.
Hayes was the first company in computer networking.
All lead.
One reason the first brand tends to stay in the lead is that
the brand name often becomes the generic name for the category.
Xerox was the first plain paper copier
and has become the name of all plain paper copiers.
People will stand in front of Ricoh,
Sharp or Kodak copiers and say,
“How do I get a copy of Xerox?”
They will ask “Kleenex”
while the cover of the tissue box has the word Scott clearly printed on it.
They will also offer you Coke when they only have Pepsi-Cola.
How many people ask for cellophane tape
instead of “Scotch” tape? Not much.
Most people use the brand name
when it becomes a generic name:
BandAid, Fiberglas,
Formica, Gore-Tex, Jello,
Krazy, Glue, Q-tips,
Saran Wrap, Velcro…
That’s just a small part.
Some people will take the long name
to change the brand name to a generic name.
“FedEx this package goes to the coastal area”.
If you are introducing the first brand of a new item (category),
try to choose a name that can become a generic name
for the whole category.
(Lawyers often advise the opposite,
but what do they know about the laws of the market?).
Often, it is not only the first brand that
becomes the leader,
but the order of sales of the brands often matches the position of that brand.
The best example is the drug ibuprofen.
Brand Advil ranked first, Nuprin second,
Medipren third.
The order of revenue they are enjoying is exactly the same:
has 51% of the market,
ibuprofen,
Nuprin 10% and Medipren 1%.
The fourth brand to enter the market is Motrin IB.
Despite having an effective ibuprofen formulation,
the Motrin brand shares only 15% of the market.
Remember that Advil also introduces the same formula as Motrin.
And it should also be noted that
Advil became the alternative generic name.
Consumers use Advil as a generic noun,
rarely using the word ibuprofen.
Even medical doctors will tell patients,
“Take two “Advil” pills and see me in the morning.”
The same goes for Tylenol.
Was the first brand of acetaminophen.
was so far ahead of the second-placed brand that
it was difficult to tell which was the second.
If the secret of success is in the memory of future customers,
then
What strategy are most companies determined to pursue?
Better product strategy.
The newest
and hottest topic in the field of business administration is standards.
The standard has been raised as:
“Unique Competitive Strategy”;
benchmarks are considered tools to compare
and evaluate your company’s products
with the best in the industry;
It is referred to as an essential element in a process commonly referred to
as “integrated quality management”.
Unfortunately,
the standard strategy didn’t work out.
In fact, the first product that comes to mind is the best product:
Marketing is a battle of perception,
not product.
What were the first brand names of aspirin,
of acetaminophen,
of ibuprofen?
(Hint: Replace “first” with “leading”
and you will have the answer to this question).
Charles Schwab considers himself “the largest stockbroker in America”.
Would you be surprised to learn that the Charles Lindlbergh
of the equity trading business is actually Charles Schwab.
Neil Armstrong was the first person to walk on the moon.
Who is the second?
Roger Bannister was the first person to run a mile (1.6km) in 4 minutes.
Who is the second?
George Washington was the first President of the United States.
Who is the second President?
Thomas’ is the first brand of English muffin.
What is the second brand?
Gatorade was the first brand of a sports drink.
What is second?
If you were second in the memory of your future customers,
could you avoid the kind of oblivion that happened to Buzz Aldrin, John Landy,
John Adams,
the anonymous English muffins?
It doesn’t have to be,
fortunately,
there are other rules as well.
