Al Ries and Jack Trout believe that the true nature of contemporary marketing is outwitting, outflanking and outfighting the competition. This is a different approach than Kenichi Ohmaeâ€™s who believed in customer focused approach. Ries and Trout perceive an industry to consist of a leader, a challenger and the â€œguerillasâ€? or â€œnichersâ€?. Accordingly, they have talked about the marketing warfare. In this section we will review some of the principles of this warfare.
Defensive marketing warfare is played by the market leader who wants to hold on to his market share. One of the best options before the leader is to continuously attack its own self. This involves questioning whether the existing product portfolio is competitively satisfying the customer needs or are there any new needs that are emerging which the current portfolio is unable to satisfy; is the current distribution plan effective enough to meet emerging market segments and needs or is a change required. Likewise, the defensive warfare would demand that the firm re â€“ examine its desired and actual market positioning, pricing strategies and policy and promotional programmes. This implies that the market leader firm can maintain its leadership only as long as it sheds its myopia. Unfortunately marketing success often breeds complacency and inertia among the firms and hence they lose their market supremacy.
Defensive marketing warfare also demands the leader firm to block any strong competitive moves. For example, launch of a new and â€œbetterâ€? product by a competitor firm can be effectively blocked if the leader firm increases its promotion (both consumer and trade) budget, fills up the retail outlets with its brand or offer special bonus to the intermediaries if they provide additional shelf space and push its brand during the competitor brands launch period. Nestle adopted this strategy to effectively block the launch of competitor brand like Bru in the instant coffee market.
The market leader should always keep something in reserve. Like in a game of chess or the poker in a cards game, the leader should never expose all his armours in a single shot. For example, in NestlÃ©â€™s case, the company did not introduce its new product in the instant coffee market rather it increased its promotion and distribution thrust for its Nescafe brand of instant coffee. It is always advisable to hold some strategic decisions in reserve so as to surprise the enemy force and also to use it only as second line of defense, when the first set of moves has not been able to effectively block the competitor moves.
Finally, the market leader should not indulge in doing things that could increase legal exposure. For example, going after small firms can bring a charge of monopoly against the market leader. If it were to happen, the public sympathies are always for the smaller firms. The outcry against the market leader can create a negative publicity for it â€“something which no firm, least of all the market leader, can afford. Hindustan Levers learnt this the hard way as we saw in the opening case illustration.
This is a warfare played by the market challenger or the firm that is vying for the number one position in the market. The challenger has to consider the leaderâ€™s strengths and identify the weaknesses. Until the time Gajra Gears entered the transmission gears market, the OEMs, mainly TELCO or Ashok Leyland in HCV market, were the market leaders in the spare part replacement market. The strength of the OEMs was quality, compatibility with the vehicleâ€™s gear box and country-wide availability.
Finally, a challenger firm should not close its eyes to the weaknesses in its own strength i.e. low price. This weakness emanates from its inability to make its product less harmful in the userâ€™s hands. Hindustan Levers exploited this by offering a safe and more powerful detergent powder at par with Nirma in terms of price. Soon, Nirma lost its competitive advantage to Sunlight and Wheel detergent powders.
Flanking warfare assumes an element of surprise and continuous pursuit of the goal. T-series pursued the goal of market supremacy by bringing in new music and sponsoring new singers so much so that it may not be incorrect to say that some of todayâ€™s top background singers like Anuradha Poudwal and other musicians owe their growth and prominence to T-series.
This is a strategy called niche leadership .This involves carving out a market niche large enough to be defended by a firmâ€™s capabilities .The niche leader should never act like the mss leader as it is not a viable option. Finally, the niche leader or the guerilla should be able to vacate a niche without severe losses.
Thus, marketing warfare principles are the ones that have been based on military warfare. It obviously assumes that all competing firms are vying for full customer awareness and hence money. A Firmâ€™s position in the market and its competencies fitting with the market can help it determine the game it needs to play.