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Strong competitive moves should always be blocked.
Most companies have only one chance to win, but leaders have
two. If a leader misses an opportunity to attack itself, the
company can often recover by copying the competitive move. But
the leader must move rapidly before the attacker gets
established.
Many leaders refuse to block because their egos get in the way.
Even worse, they knock the competitor's development until it's
too late to save the situation.
Blocking works well for a leader because of the nature of the
battleground. Remember, the war takes place inside the mind of
the prospect. It takes time for an attacker to make an
impression in the mind. Usually, there's time enough for the
leader to cover.
The U.S. automobile industry illustrates this principle well.
Says John DeLorean in the book on a Clear Day You Can See
General Motors: "Even though ford was superior to General Motors
in product innovation during the time. I was with GM and
Chrysler surpassed it in technical innovation, neither firm made
substantial cuts into GM's half of the market."
"Gm had not produced a significant, major automotive innovation
since the hydramatic automatic transmission (1939) and the
hard-top body style (1949)," continues DeLorean, "Ford pioneered
in practically every major new market while Chrysler produced
the significant technical innovations, such as power steering,
power brakes, electric windows and the alternator."
But who gets the credit for engineering excellence? General
Motors, of course.
It's the flip side of the "truth will out" fallacy. The prospect
also assumes that truth will out. Therefore, the prospect
reasons that the market leader must have truth on its side, that
is, the GM product is superior.
There is also the psychological pressure that benefits the
leader. In a famous experiment by Solomon Asch of the University
of Pennsylvania, many people were willing to go against the
evidence of their own senses in order to go along with the
majority.
When asked to match the length of a set of lines and
Associated Websites
confronted
with a group that had been carefully briefed to give unanimously
wrong answers, 37 percent of the subjects submitted to the
misleading group opinion and also gave the wrong answers.
The power of the majority was indicated by the typical reaction
in the Asch experiment: "To me it seems I'm right, but my reason
tells me I'm wrong, because I doubt that so many people could be
wrong and I alone right."
The fact is, many people pay more attention to the opinion of
others than they do to their own. If everyone else is laughing
in the theater, you assume the movie is not funny. (That's why
they put the laugh tracks on the TV situation comedies.)
Should a leader cover all bets or just the ones that are most
likely to succeed? Obviously there's no point in covering
downright silly ideas, but who's to judge? When the first
Volkswagen Beetle arrived, it looked strange indeed. "The three
most overrated things in America," went a typical Detroit joke,
"are Southern cooking, home sex, and foreign cars."
Many companies have lived to regret instant putdowns like this.
So today the watchword is more likely to be: "Let's monitor the
situation and see what happens."
But that can be a dangerous tactic for a leader. Too often what
happens too fast? All of a sudden, it's too late to get into the
new ball game.
Currently, disposables represent about 40 percent of the razor
blade market. If Gillette had waited and let Bic dominate this
market segment, Gillette's position would be much weaker today.
It's safer to over cover than to undercover. The stainless steel
blade introduced by Wilkinson Sword never went anywhere, but
Gillette covered anyway. The small cost was worth it. Call it
insurance if you wish.
About the author:
This article may be re-printed as long as following resource box
is included as it is with out any alteration.
This Marketing Idea is published by www.nuttymarketer.com. Visit
us to find more of cheeky gorilla Ideas.
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