“The Economic Times” or “The Hindu Business Line” carries more blood thirsty language than is found in any of the general newspapers. “We’ll murder them”, “Its kill or be killed”, “This is a life or death struggle”, these quotes form a part of the conversation of business leaders discussing their marketing campaigns. The language of business is becoming littered with similes of war and military analogies.
Articles dealing with competitive strategy are on the rise and business people frequently use military talk to describe their situations.There are ” price wars” ,”border clashes” and skirmishes” along the major computer manufacturers; “an escalating arms race” among cigarette manufacturers, “market invasion” and “guerilla warfare” in the coffee market. A company’s advertising is its “propaganda arm”, its salesmen are its “shock troops” and its marketing research is its “intelligence”. There is talk about “confrontation”, “brinkmanship”, “super weapons” ,”reprisals” and ” psychological warfare”. It’s very evident that marketing is entering a new era, where the name of the game has become “taking business away from somebody else”.As companies figure out ifferent ways to increase sales, they are turning towards employing more and more warfare strategies in general. Different military theorists have different theories regarding the objective of war.
Clausewitz, the nineteenth century’s greatest military theorist saw war as a necessary means to pursue national self interest. It was a means to vanquish the enemy by achieving unconditional surrender.On the other hand the twentieth century’s greatest military theorist Captain Basil H. Liddell Hart set the contemporary position “The object in war is a better state of peace, even if only from your point of view. ” Modern competitors rarely adopt the Clausewitzian objective of “total annihilation of the enemy”. Liddell Hart’s doctrine that “the object of war is a better state of peace” may be more appropriate guiding line of business.
When a company undertakes warlike maneuvers towards another firm, for example when Kodak attacks Polaroid, the objective is not to annihilate the other but to attain a better state of peace.When Kodak introduced its own version of the instant camera, t may have aimed to achieve the dominant share, but Polaroid fought back and managed to contain Kodak’s share at about 25%, and now both of them seem to accept the compromise share. This however does not mean to say that Kodak might not launch an attack in the future to regain the 50% share. In most battles the terrain is important enough for the battle to be named after its location. Even in case of marketing warfare the terrain is equally important.
Marketing battles are not fought in the customer’s office or in the supermarkets or the drugstores but in the minds f the prospective customers and they are fought every day of the week. The mind is the battleground. A terrain that is tricky and difficult to understand. A marketing war is a totally intellectual war with a battleground that no one has ever seen. It can only be imagined in the mind and that is why marketing warfare is one of the most difficult disciplines to learn. In order to study the terrain of the mind it is important to find out the positions that are held by the competitors.Like in a military war, hills or mountains are considered strong positions for defense so is the case in a marketing war.
In this case the hills or the mountains are “high grounds” which offer a strong position to companies that occupy them. When a customer says he wants a Xerox you know that the photocopy mountain is occupied by Xerox. Similarly in the computer industry IBM enjoys high ground. In some cases we observe that an intense battle is fought over one of the mountains and it is in turn cut into segments.
Thus we can say that segmentation refers to tearing up the terrain into smaller mountains. Each of the competitors must define its strategic objectives in each of its markets. The business objective could be to crush the competitor, reduce its share, or freeze its share. Unlike war, where the enemy is “given”, the business firm in most cases is able to choose the enemy. All markets are occupied by one or more firms that enjoy different competitive positions, strengths and weaknesses.The firm having the largest market share is the market leader. One or more firms that are large enough to fight one another and the leader for territory are the market challengers. Some other firms that are large but play the role of market follower as they are ontent with their current positions in the market and do not wish to rock the boat.
Several smaller firms that serve small market segments which usually do not attract the interest or action of the larger firms are the market nichers. The issues of choosing the enemy and choosing the objective interact.If the attacking company goes after the market leader, its objective may be to gain or maintain a certain share. If it goes after a small local company, its objective maybe to drive that company out of existence.
Strategies to fight the marketing war There are different ways of fighting the arketing war and the type to fight depends on the company’s strategic position in the industry. In terms of the marketing battleground the mountain is the high ground owned by the leader. If a company goes through the mountain then it’s fighting an offensive marketing war.The company might find a valley or crevice through which it can break through but the battle is tough as the leader has the resources to make strong counter attacks. If a company comes down the mountain to stop competitive attacks then it’s fighting a defensive marketing war.
And the rule is, the best defense is a good offense. Similarly, if a company goes around the mountain then it’s fighting a flanking marketing war. This type of warfare is the most effective and least expensive type of marketing operation to conduct.Unfortunately opportunities for good flanking moves are becoming scarce in many product categories. If a company is under the mountain then it’s fighting a guerrilla marketing war. It selects a territory secure enough to defend or one which is too small for the leader to bother with. We would now deal in detail with the strategies employed in various types of marketing war.
This technique is adopted by the leader in a given industry. Unfortunately, most of the companies today consider themselves as the leader.This is because they base their definitions more on creative definitions than on market realities. However the truth of the matter is that companies do not create leaders, customers do. It’s who the customer perceives as the leader that defines a true category leader.
For example in the computer industry there is only one leader i. e. IBM in the mind of the customers and prospects. The leadership position helps the leader own a strong point in the mind of the prospect. The best way to improve upon that position is by constantly attacking it.
In other 3 Spandan words the leader strengthens its position by introducing new products or services that obsolete the existing ones. For example, IBM is the master of the game. Ever so often, IBM introduces a new line of mainframe computers with significant price/performance advantages over existing products.
Competition continually struggles trying to catch up. A moving target is harder to hit than a stationary one. Attacking yourself may sacrifice short term profits, but it has one fundamental benefit, it protects market hare, the ultimate weapon in any marketing battle.The reverse is also true; any company that hesitates to attack itself usually loses market share and ultimately market leadership. Most competitors have only one chance to win but leaders have two. If a leader misses an opportunity to attack itself, it can often recover by copying the competitive move.
However, it is important that the leader moves quickly before the competitor is established. It has been observed that many leaders refuse to block because their egos get in the way. Blocking works well for the leader because of the nature of the battleground.Recollecting the fact that the war takes place inside the mind of the prospect, it takes time for an attacker to make an impression in the mind. Hence, there is usually enough time for the leader to recover.
The goal of a defensive war is marketing peace with the competition reduced to sporadic guerrilla attacks. Marketing peace has been achieved by Kodak in photographic film and IBM in mainframe computers. Each of these companies has a dominant market share of its market. So dominant are the positions of these companies that there are no companies in the second place in the mind of the prospect.