We all know the classic story of David and Goliath, the little guy facing down enormous odds—and confidently winning the day.
In the business world it’s not just a story—it’s a daily reality. Every time an inspired entrepreneur puts his or her future on the line to bring a new product or service to market, they’re facing the Goliaths of major brands who have already claimed that space.
So why do some start-ups succeed, while so many others succumb to big competitors? It’s a fascinating question. Ultimately, there are as many answers as there are brands that started out as an idea and won themselves a place in the market. Yet I think they all boil down to two fundamental approaches that I call The David Strategies. One: Stand Your Ground. Two: Target with Pinpoint Precision.
I’m not talking exclusively about the brands that have grown to become household names around the world. Those are great stories—but so are the stories of smaller niche retailers, innovative B2B brands, and local service providers who have succeeded in carving out a space where they can thrive.
While each of their stories is unique, they almost always follow one or both of the top two strategic approaches that turn challenger brands into big winners.
1. Stand Your Ground.
Successful challenger brands know their territory and stake it out, clearly. This goes beyond the traditional “positioning statement,” to encompass a detailed understanding of the characteristics of their brand community. Like David, they stand forward to represent the shared value-sets of like-minded brand followers.
A great example of this is Tesla Motors, the manufacturer of premium electric vehicles. It is a brand that has become the standard-bearer for a large following of people who believe there’s a better way to do personal transportation – and who distrust the major car manufacturers who claim to be pursuing the same goal.
Tesla early on took the position of the hero and #1 advocate of electric vehicles. The company’s leading spokesperson, co-founder Elon Musk, holds forth at every opportunity on the topic of clean technology for a healthy planet. Tesla has smartly encouraged its growing brand community to contribute to an active forum on its website. And the community has responded with literally hundreds-of-thousands of user-generated posts ranging from thoughts on global warming to the merits of the Tesla vehicles themselves.
The strategy has worked so well for Tesla that customers were lined up over a year ago to put a deposit on the new Model 3—a car that doesn’t even exist yet!
It isn’t just big-ticket items, though; or save-the-earth social movements. The power of staking out territory and establishing an intimate rapport with your brand community can be seen in such everyday activities as choosing an over-the-counter (OTC) treatment from among the competing brands on the pharmacy shelves. If there was ever a battleground between Davids and Goliaths in the North American marketplace, the local pharmacy is it!
The Benzagel® brand is an OTC acne care product that competes against much larger brands from the likes of P&G and Johnson & Johnson. Yet, according to recent Nielsen data, it is the growth leader in its category. This has been achieved through a strategy remarkably similar to Tesla’s: first, stake out a strong position of credibility, then, invite your brand community to join in.
Through effective promotion of its brand story to Canadian Pharmacists, Benzagel was able to win the status of #1 Pharmacist-Recommended Acne Treatment in Canada—five years in a row.
This endorsement from an influential group generates tremendous credibility within the Benzagel user audience as well. Building on the platform of #1 OTC acne treatment, Benzagel has encouraged a vibrant brand community that contributes its own engaging content to the brand’s website, thus completing the circle of brand credibility and peer-level endorsement.
2. Target with Pinpoint Precision.
As a challenger brand, you will be up against competitors with deeper pockets and broader resources. Think of your marketing plan as that small, round stone that you need to use with precision to get the job done. It simply makes sense to avoid wasting resources where they aren’t effective.
Easier said than done.
Good targeting requires deep strategic insight into the needs and motivations of your brand community. The kind that comes from a comprehensive state-of-the-brand investigation. And it doesn’t stop there, because as your brand community evolves, you need to keep up with its changes. You need to be continuously learning, through insightful analysis of the data available.
Most marketers, whether big or small, acknowledge that targeting is important, of course. The difference with challenger brands is that smart targeting can truly be a matter of life or death. A great example is Montessori schools. For them, the Goliath is the government-operated public school system. And the brand community is parents who are willing to pay with their own money for what they believe is a better educational approach.
Every neighbourhood Montessori school is responsible for its own marketing. So dollars are tight, and have to be focused on those parents in the neighbourhood who are searching for an alternative. To accomplish this, virtually every Montessori school has its own website, with a digital campaign built around keywords like “natural education” and “child centered learning.” It’s a formula that has worked remarkably well, making Montessori the fastest-growing private school network in the world, and sustaining about 500 highly-regarded Montessori schools covering every province of Canada.
Another excellent example of niche market challengers is the phenomenon of micro breweries and craft breweries that have been cropping up across North America in the last decade or so. With a tiny fraction of the budgets of mainstream breweries, they must reach out to an audience of beer connoisseurs within a limited geographic area. Not all succeed; but those who target their marketing efforts well can enjoy the long term loyalty of their brand community.
One such brewery is Blade’s client Ramblin’ Road Brewery Farm, in Norfolk County, Ontario. Although it offers natural abundance and wonderful amenities, Norfolk County is not among Ontario’s best-known tourist destinations. We knew when we developed the brand that enlisting the local community would be essential if the beer was to quickly gain ground against well-entrenched mass-market brands.
Blade developed and deployed an active social media campaign to foster enlistment within Norfolk County, complemented by a targeted media and community relations effort.
The strategy was an immediate success. On the first weekend the Brewery Farm opened, the crowd began lining up at 9 am for a 10 am opening. By 2 pm, the complete inventory of over 1,100 cases had sold out!
Of course, there are many factors that need to come together to ensure that kind of success for a niche brand or start-up. Working with an agency that understands how to grow brand communities is always a good idea, for starters.
No matter what market you’re talking about, though, chances are the winning formula will include the two fundamental strategies described here.