The 22 immutable laws
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The 22 immutable laws

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It’s better to first than it is to be better…the basic issue in marketing is creating a category you can be first in…it’s much easier to get into the mind first than it is to try and convince ...

It’s better to first than it is to be better…the basic issue in marketing is creating a category you can be first in…it’s much easier to get into the mind first than it is to try and convince the public that you have a better product than the one that did get into the mind first.

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The 22 immutable laws The 22 immutable laws Presentation Transcript

  • The 22 Immutable Laws of Marketing (Violate them at your own risk!) …by Al Reese & Jack Trout Presented by:Ken Carroll, Marketing Consultant
  • Al Reese an Jack Trout put 25 years of study into what works and whatdoesn’t work in marketing…the 22 laws…Violate them at you own risk!Law #1…the Law of Leadership o It’s better to first than it is to be better…the basic issue in marketing is creating a category you can be first in…it’s much easier to get into the mind first than it is to try and convince the public that you have a better product than the one that did get into the mind first. o Applies to any product or category…examples…magazines…Time leads Newsweek, People leads US…Playboy leads Penthouse, etc…In cars…Jeep was the first 4 wheel drive off road vehicles…Acura first in luxury Japanese cars...in computers, IBM was first in mainframes…these are all leading brands… the minivan was introduced by Chrysler , which still dominate the minivan market…but have a much smaller share of the auto market…so is it all about making better cars? No, it’s about being first….one reason the first brand often leads is because it’s name becomes generic… people often stand in front of a Ricoh or Kodak machine, and ask for a Zerox copy…or ask for a Kleenex (instead of a tissue) when the box clearly says Scott…how many people ask for cellophane tape instead of Scotch tape…not many. o Q-tips, velcro, band-aids, jello, etc…when introducing the first brand in a new category, always try to select a name that can work generically. Brand names become generic. o The sales order of followup brands often matches their introduction…Advil, Nuprin, Mediprin…same order they now have in sales. o If the secret is getting into the mind first , then why are so many companies still following the better product strategy? o “Benchmarking” involves comparing products, but it doesn’t work…people percieve the first product in their mind as superior, and marketing is the battle of perceptions, not products. o What was the first brand of ibuprofen?…..aspirin?….acetominophen?…substitute “leading” for “first”, and you’ll have the answer…Neil Armstriong was the first person on the moon – who was second? George Washington the first President…who was second? But thankfully, just because your second in the mind, your not doomed…there are other laws…
  • 2. …the Law of the CategoryIF YOU CAN’T BE FIRST…. SETUP A NEW CATEGORY YOU CAN BE FIRST IN….CREY RESEARCH WAS THE FIRST SUPERCOMPUTER…TODAY AN 800 MILLION DOLLAR COMPANY…SO A COMPANY CALLED CONVEX LAUNCHED THE FIRST MINI-SUPERCOMPUTER…AND TODAY ARE AN 200 MILLION DOLLAR COMPANY…SOMETIMES YOU CAN TURN AN ALSO RAN INTO A COMPETITOR…THE COMMODORE OMEGA WAS JUST A FLOUNDERING PERSONAL COMPUTER COMPANY…TIL THEY POSITIONED THE OMEGA AS THE FIRST MULTI-MEDIA COMPUTER…TODAY THE COMMODORE OMEGA IS A BIG SUCCESS.WHEN YOU LAUNCH A NEW PRODUCT DON’T ASK HOW OR IF IT’S BETTER THAN THE COMPETITION…ASK WHAT…WHAT CATEGORY IS THIS PRODUCT FIRST IN? CHARLES SCHWAB DIDN’T OPEN A BETTER BROKERAGE FIRM, HE OPENED THE FIRST DISCOUNT BROKER…AND TODAY IS AMERICAS LARGEST DISCOUNT BROKER …LEERS WAS NOT THE FIRST WOMENS MAGAZINE, IT WAS THE FIRST WOMENS MAGAZINE FOR THE MATURE WOMAN….THIS IS COUNTER TO CLASSIC “BRAND” MARKETING THINKING – HOW DO YOU GET PEOPLE TO PERFER YOUR BRAND…FORGET THE BRAND! THINK CATEGORIES…IN ESSENCE YOU’LL HAVE NO COMPETITION, AND CAN ENJOY YOUR OWN “FIRST”. View slide
  • 3…THE LAW OF THE MIND…o IT’S BETTER TO BE FIRST IN THE PROSPECTS MIND THAN FIRST IN THE MARKETPLACE…o DUMONT INVENTED THE FIRST COMMERCIAL TV SET…DURYEA INTRODUCED THE FIRST AUTO…AND HURLEY INTRODUCED THE FIRST WASHING MACHINE……ALL ARE GONE! IS SOMETHING WRONG WITH THE LAW OF LEADERSHIP? NO, BUT THE LAW OF THE MIND MODIFIES THE LAW OF LEADERSHIP…IT’S BETTER TO BE PERCIEVED FIRST IN THE MIND THAN IT IS TO BE FIRST IN THE MARKET…BEING FIRST IN THE MARKETPLACE ONLY ALLOWS YOU TO HAVE THE PRIVILEDGE OF GETTING INTO THE MIND FIRST…THE REST IS UP TO YOU…EXAMPLE…IBM WASN’T FIRST IN SUPERCOMPUTERS…REMINGTON WAS WITH UNIVAC…BUT IBM ENSUED WITH A MASSIVE MARKETING CAMPAIGN, AND WAS PERCIEVED FIRST…AND THAT’S WHERE THE BATTLE IS…IN THE MIND….BUT MONEY IS NOT ALWAYS THE ANSWER…ONCE SOMEONE PERCIEVES YOU IN THE MIND IN A CERTAIN CATEGORY…IT’S ALMOST IMPOSSIBLE TO CHANGE A HUMAN MIND. YOU HAVE TO BLAST YOUR WAY INTO SOME NEW MINDS…AND SOMETIMES THOSE “NEW MINDS” OR NEW PROSPECTS THAT HAVE NOT HEARD OR BELIEVED VERY MUCH IN YOUR COMPETITORS PRODUCT…CAN HELP CHANGE THE MINDS OF OTHER PEOPLE FOR YOU, THRU CONFORMITY AND REFERRAL.o Choose an easy name to remember- home computers example…Imsec, commodore peck, apple, radioshack tm-80 …who won? (the simplest is the answer...Apple) View slide
  • 4. The Law of Perception… o Marketing is not a battle of products, it’s a battle of perceptions… marketing people do tons of research to prove who’s better… but truth is, it’s what people think that counts…. people are seldom if ever wrong in their own mind… o …also, to complicate matters, often people make buying decisions based on second hand perceptions…”the everybody knows” principle…”everybody knows” the Japanese make better quality cars…so if you got a bad one, you were unlucky…yet if you got a good domestic auto, you were lucky.
  • 5. The Law of Focus…THE MOST POWERFUL CONCEPT IN MARKETING IS OWNING A WORD IN THE MIND…A SIMPLER WORD OR CONCEPT IS BEST… …BURN YOUR WAY INTO THE MIND WITH A SINGLE FOCUS…FEDEX SACRIFICED IT’S PRODUCT LINE BY FOCUSING ON ONE THING…OVERNIGHT PACKAGE DELIVERY ONLY…IN A WAY, THE LAW OF LEADERSHIP, THE “BETTER TO BE FIRST IN THE MIND THAN BETTER” PHILOSOPHY ENABLES THE FIRST BRAND OR COMPANY TO OWN A WORD IN THE MIND… BUT THE WORD THE LEADER OWNS IS SO SIMPLE IT’S INVISIBLE – THE LEADER OWNS THE WORD THAT STANDS FOR THE CATEGORY…IBM OWNS “COMPUTER” IN THE MIND…THIS IS ANOTHER WAY OF SAYING THE BRAND BECOMES A GENERIC NAME FOR THE CATEGORY… TEST THE LEADER WITH A WORD TEST… COMPUTERS… COLA…. CHOCOLATE BAR…. COPIER… THEN THE 4 MOST ASSOCIATED WORDS ARE IBM, COKE, HERSHEYS, XEROX…AN ASTUTE LEADER WILL GO ONE STEP FURTHER….HIENZ IS THE “SLOWEST” KETCHUP IN THE WEST… (TOUTING IT’S THICKNESS ATTRIBUTE)…THE WORD SLOW HELPS RETAIN THEIR MARKET SHARE. YOU CAN’T STAND FOR SOMETHING IF YOUR FOCUS IS EVERYTHING. PRO-LIFE, PRO-CHOICE ARE EXAMPLES.
  • 6. THE LAW OF EXCLUSIVITY• 2 COMPANIES CANNOT OWN THE SAME WORD IN A PROSPECTS MIND…VOLVO OWNS THE WORD SAFETY…MANY OTHER COMPANIES AUTO HAVE UNSUCESSFULLY TRIED TO EMULATE THEM…• MANY COMPANIES STILL TRY TO DO THIS, DUE TO ALL THAT WONDERFUL “RESEARCH” THEY LIKE TO BLOW MONEY ON…WHAT COMES BACK IS A WISH LIST OF WHAT THE “PEOPLE WANT”…SO, THE COMPANIES SAY – LETS GIVE IT TO THEM…AND LATER- WHAT WENT WRONG?• EXAMPLE…BURGER KING STARTED YEARS AGO DOWN THIS SLIPPERY SLOPE, AND THEY HAVE NEVER FULLY RECOVERED…RESEARCHERS SAID PEOPLE WANT THEIR FOOD FAST! SO LETS ADVERTISE WE ARE THE FASTEST! PROLEM…MCDONALDS ALREADY OWNED THAT FASTEST OF FAST FOOD IN PEOPLES MIND…FAST WAS MCDONALDS WORD AT THAT TIME…REGRADLESS, BURGER KING LAUNCHED “FAST FOOD FOR FAST TIMES” CAMPAIGN AND IT BOMBED…
  • 7. THE LAW OF THE LADDER THE MARKETING STRATEGY A COMPANY USES SHOULD RELATE TO WHERE THEY ARE ON THE “LADDER” OF CONSUMERS MINDS…WHILE GETTING INTO MIND FIRST SHOULD BE PRIORITY ONE, THE BATTLE ISN’T LOST IF NOT…THERE ARE STRATEGIES TO USE FOR #2 AND #3 BRANDS…ALL PRODUCTS ARE NOT CREATED EQUAL…THERE IS A HIERARCHY IN THE MIND THAT PROSPECTS USE IN MAKING DECISIONS….FOR EACH CATEGORY THERE IS A PRODUCT LADDER IN THE MIND…ON EACH RUNG IS A BRAND NAME…TAKE RENTAL CARS… HERTZ GOT INTO THE MIND FIRST, AND ON TOP RUNG…AVIS INTO MIND SECOND…AND NATIONAL THIRD…YOUR MARKETING STRATEGY SHOULD DEPEND ON HOW SOON YOU GOT INTO THE MIND…AND CONSEQUENTLY WHICH RUNG ON LADDER YOU OCCUPY… EXAMPLE…AVIS FOR YEARS ADVERTISED HIGH QUALITY…EVENTUALLY INSTRUCTING THEIR AD AGENCY TO PUT AVIS HAS THE HIGHEST QUALITY OF IT’S RENTAL CAR SERVICE IN ALL ADS…PROBLEM…PULIC SAID WAIT A MINUTE…HOW CAN THEY HAVE THE HIGHEST RENTAL CAR SERVICE WHEN THEY ARE NOT ON THE TOP RUNG OF MY LADDER? IT BOMBED…THEN THEY GOT SMART, AND *ACKNOWLEGED THEIR POSITION ON THE LADDER… ”WE ARE #2, BUT WE TRY HARDER”…THEY LOST MONEY 13 YEARS IN A ROW UNTIL THEN. *Note…it wasn’t because they said “we try harder”…if that were true, Harold Stassen would have been President many times over.
  • 8…the Law of DualityIN THE LONG RUN, EVERY MARKET EVOLVES INTO A 2 HORSE RACE…EARLY ON A NEW CATEGORY BECOMES A LADDER OF MANY RUNGS…GRADUALLY OVER TIME IT BECOMES A 2 PLAYER AFFAIR… USALLY THE OLD RELIABLE BRAND, AND THE UPSTART…IN LONG DISTANCE CARRIERS…AT&T 62%...MCI 15%, SPRINT 9%…WHO WILL WIN, NO-ONE KNOWS, BUT BET ON MCI TO WIN SECOND PLACE(REMEMBER WHAT HAPPENED TO ROYAL CROWN COLA…THEY WERE GONNA TOPPLE COKE AND PEPSI……IN A MATURING INDUSTRY, THIRD PLACE IS HEADING FOR NOWHERE….…eventually they’ll be fixed, closed, or sold.
  • Law # 9…the Law of the Opposite… …IF YOUR SHOOTING FOR SECOND PLACE, YOUR STRATEGY SHOULD BE DETERMINED BY THE LEADER. …IN STRENGTH THERE IS WEAKNESS….WHEREVER THE LEADER IS STRONG IS AN OPPORTUNITY FOR A WOULD-BE COMPETITOR TO TURN THE TABLES…LEVERAGE THE LEADERS’ STRENGTH INTO A WEAKNESS…BE DIFFERENT, NOT BETTER….PEPSI REVERSED THE ESSENCE OF TRADITIONAL COKE TO BECOME THE CHOICE OF A NEW GENERATION…THE PEPSI GENERATION… …THERE ARE PEOPLE WHO WANT TO BUY FROM A LEADER, AND THERE ARE PEOPLE WHO DON’T… …A #2 HAS TO APPEAL TO THE LATTER…AND IF OLD PEOPLE DRINK COKE AND YOUNG PEOPLE PEPSI, THERES NO ONE LEFT TO DRINK ROYAL CROWN! PRESENT YOURSELF AS AN ALTERNATIVE, AND DON’T BE TIMID….KEEP ATTACKING THE #1 BRAND.