The Law of Duality - Law #8 under the 22 Immutable Laws of Marketing
“In the long run, every market becomes a two horse race”. ‘In every category is a ladder with many rungs. Gradually, the ladder becomes a two rung affair’.
In continuation with the previous law ‘The Law of Ladder’, the 8th Law under the ‘22 Immutable Law of Marketing‘ is more about the first two positions on the ladder. It is a common fact and a human phenomenon to usually remember the first two names for any product or service. The first name being that of the preferred one and the second one being that of the alternate option. Very few people keep options beyond the first alternate option and in most cases the third option is of no use.
Today’s market is too crowded with options under most of the products and services. The only reason most of the options other than the leader and the follower are surviving are because of the niche group of customers they are catering into. This can be credited to the ‘Law of Exclusivity‘ under which the brands hunt for the specific word with which they can stand a chance to be identified and associated with. Generally, any range of products or services are first summed up at the top level and that is where the leader and the follower are identified. This is the first level or the basic level where the market leader and the second in command are recognised. Further from this level, it is further categorized into multiple sub categories where the ‘Law of Category‘ comes into play. At this level we can further identify a leader and a follower for that specific category. Further from this level, we can identify one more set of a leader and a follower when we apply the “Law of Exclusivity‘.
With these many levels open to be identified, there are too many first and second places available for occupancy if the right methodology and approach are applied at the right time. Past experiences have revealed that the second position is the most happening position is the most talked about due to the regular initiatives they take in order to topple the table positions. However, the first or the top position in any category is the most difficult position to be in during the first five years of the occupancy. The leader can then go into the next gear and feel a little bit comfortable post the five year term as they would have covered some considerable number or minds by then. This again depends on how far their nearest competition is. The closer the follower the more cautious the leader has to be.
One other trend or pattern that we have been seeing recently has been the bigger companies taking over the smaller ones, in other words capturing the smaller takers in the market. This has been fairly successful in monopolizing a brand but not always. There have been instances that the buying out of the competition has hurt the leader or the ‘would be’ leader to a great extent. The primary reason being the kind of financial risk the buyer gets into whilst buying out the smaller ones. There have also been instances where the bigger one was bought over by the immediate follower either through forming a consortium or by just buying out one specific product line of a bigger brand. Some buyouts were done to capitalize on the extra market share they would get as a merger and some were to just kill the other brand like the one that happened to ‘Deccan Airways’ in India being bought over by ‘Kingfisher Airlines’ and as a result the Deccan brand being completely nullified.
In the automobile arena, brands buyout the competitors in order to expand the market share and also to distribute the risk of losing to the competition. A classic example would be that of Volkswagen and Skoda alongside Renault and Nissan. Recently Volkswagen India released VW Vento, a midsized passenger car and sometime later Skoda released Skoda Rapid which is almost a replica of the Vento except for some costmetic changes both on the outside and the inside. Both of these cars are look-alikes to the extent that Skoda Rapid cars are fitted with windscreens that carry the logo of VW and are built in the same facilities. Similarly Renault came up with Duster SUV and sometime later Nissan came up with Terrano a complete look alike of the Duster, again put together at the same plant. This strategy has ensured that the market share though under different brands is owned by a single parent company. The customers will get options to buy from two different brands but the parent company will not lose the overall market share as whatever the customer buys, it will be eventually counted as the revenue for the parent company. Whatever the reason, it finally boils down the ‘big fish eating the small fish’ strategy to increase their market share and therefore their potential.
Given today’s digital independence that the corporate players enjoy, reaching out to the masses and sending out a message is much easier and effective these days. As mentioned in one of the earlier blogs, it is very easy to start a company and reach out to a considerable number of people. Hence, there is no end to the list of companies or competitors one will be able to see in any product or service line. However, the majority of business share will be handled by the first two players significantly. The ‘Law of Duality’ is therefore still applicable in the Digitized Market of today but the order of first and second is far more dynamic and susceptible to change than before.
