Written by
Al Ries and Jack Trout in 1986, Marketing Warfare has been an international
bestseller. This pair is attributed to many bestsellers including the marketing
classic, Positioning. The summary is from the 2003 Tata McGraw-Hill Edition.
The book is
spread across 16 chapters dealing with various marketing strategies drawing
parallel with the strategies used in warfare. The authors start the book by
acknowledging the role of Karl von Clausewitz, a retired Prussian general and
his book, On War written in 1832.
The summary
of the book has been divided into two parts –
·
Marketing
Warfare -1, is the summary of the theories and concepts that are explained by
the authors in the first 10 chapters
·
Marketing
Warfare -2, is the summary of chapters 11 to 16 where the authors have
explained the theory through real-life examples of marketing wars
* Example
not in the book but has been added to give Indian perspective to the concept.
Chapter 11
– The cola war
In order to check
the validity of the principles of marketing warfare the author looks at the
cola industry which reflected the warfare between Atlanta based Coca Cola and New
York based Pepsi.
Case: Coca
Cola Executives considered the shape of the 6.5 ounce bottle as strength and
got it patented. Pepsi used the flanking
principle by finding the weakness in the competitors strength by launching
a 12 ounce bottle and advertising heavily that the consumers can but 12 ounces
of Pepsi-cola at the same one nickle for which they were buying 6.5 ounce of
Coca Cola.
Coca Cola
should have followed the defensive
principle – To be courageous enough to attack yourself.
Since Coca Cola
was a long entrenched drink (strength of Coca Cola) with more people from the
middle aged generation drinking Coca Cola, Pepsi flanked Coca Cola by making
its strength as its weakness by promotion its drink with “Pepsi Generation”
alluding to the youth to be different than the older generation drinking Coca
Cola.
Coca Cola’s
best comeback to Pepsi’s attacks was its “The real thing” campaign which
essentially dubbed everything else, including Pepsi, as a copy of Coca Cola.
Royal Crown,
another Cola player, flanked Pepsi and
Coca Cola both by bringing in Diet Rite, a low calori cola drink. Neither
of the bigger players were in a position to bring in diet cola immediately.
Hence, Diet Rite became the largest selling diet cola. However, the company didn’t
follow the flanking rule – Pursuit is as important as attack. Instead of focusing
on its hero product Diet Rite, the company divided its resourced between Diet
Rite and the less successful Royal Cola, hence giving away the advantage to its
rivals.
The Pepsi
challenge was one of the biggest strategic move in mid 70s. This made Coca Cola
commit its biggest mistake. It changed its formula to make Coca Cola sweeter as
was Pepsi. This undermined its “Real Thing” position, a self-goal. This move
led to a backlash among the consumers and Coca Cola had to bring back its
original formula with the name “Classic Coke”.
The learning
is, never try to change the perception of the consumer. So even when the taste
test showed that people preferred the sweeter new coke over the Classic Coke,
when it came to buying, perception was strongly biased towards Classic Coke.
Chapter 12
– The beer war
While
Budweiser and Schlitz were engaged in a sea saw battle, Heineken came to the US
as the first imported beer after the war. It followed the “pursuit is important as attack” strategy and continued spending
lot of money on the brand building exercise in the country.
Lowenbrau
became the talk of the town with its attractive bottle and advertisement that
compared it with champagne. However, it should have adopted the offensive
principle by finding a weakness in
leader’s strength, which in this case was Heineken beer being an imported
one. However, it was imported from Holland, not Germany. Holland is not known
for making beer, Germany is.
Lowenbrau could have crafted its communication
around this. Once this was established, the strategy to keep the attack as narrow as possible must be adopted by not having
too many positioning and stick to the one strong area.
The launch
of Miller Lite was a great example of Marketing warfare on three different
aspects –
- Uncontested area – No one was talking about the light beers that time
- Tactical surprise – Miller managed to kept this close and caught the competition by surprise
- The pursuit – Once Miller got a hold of the light beer market, it never let go the advantage and spend huge money to maintain the position
However, Miller
made a mistake. While they were promoting the Miller Lite, there was not much
difference between the cans for Miller High Life and Miller Lite and with Lite’s
publicity Miller High Life’s sales started falling. Two products with similar or
same name should not be made available in the market at the same time.
Chapter 13
– The burger war
In 1984,
McDonald’s spend a quarter of a billion dollars towards advertising. It was an
undisputed leader and there was not much comeptitoin will Burger Kinf entered
the scnee. Burger King came up as challenger and used the “find weakness in strength”
rule. While McDonals was able to churn out more and inexpensive burgers fast,
the strength has a weakness. There was no customization possible.
Burger King
came up with “Have it your way” hence flanking the advantage that McDonald’s
had. Later again, Burger king flanked
McDonald’s by its “Broiling not Frying” campaign which put the leader in a
spot.
Another
chain, Wendy’s came up with adult-size burgers targeting the adults and
creating a differentiation by flanking the competition on the offering side.
Another
chain that uses the rule meant for guerrilla which is “No matter how successful
you are, never act like a leader”, is White Castle. It is successful in its own
right by serving specific kind of burgers and not getting in to egg muffins or
whoppers. They know they are successful in making burgers which are called ‘Slider’
by the loyal customers and they stick to that.
Chapter 14
– The computer war
IBM is the undisputed
leader in the computer market. Digital Equipment Corporation or DEC flanked IBM
by selling smaller computers while IBM sold big computers with software. IBM
here committed a mistake of “Not
blocking the competitive moves by a competitor”. This helped DEC thrive in
the micro-computer market which IBM could not make a stronghold in.
But later,
DEC made a mistake and didn’t attack
itself to move from the small computers to the personal computers category
and hence laid open the entry for other players in this segment which later
became a huge one. This costed dearly to DEC. IBM flanked DEC this time by
launching a personal computer.
However, in
1984 tried to flank IBM by launching three personal computers for different
needs. This was a weak strategy because a challenger
should attack on a very narrow front to gain advantage. DEC could not focus
it strength on one aspect and hence lost out.
Once IBM got
the market stronghold, they efficiently executed the leader’s defensive
strategy of attacking itself. It
continuously brought products that were better and superior to its own products
hence staying ahead of the curve and not giving its competitors a chance to
flank it.
Chapter 15
– Strategy and Tactics
Strategy
should follow tactic. Achievement of Tactical result should be the only function
of the strategy else, the strategy is faulty. Unlike work of art, strategies
should not be judged on their creativity and intelligence but rather on its effectiveness
at the point it meets the customer and the competition.
The tanks
and artillery of marketing is advertising. One should know how and when to use
it. Some of the important aspect of marketing warfare are –
- Strategy is important to win a war even with ordinary tactics
- Strategy directs tactics – A good strategy must lead to efficient tactics
- Single point attack – At any given point one objective should dominate strategic plans
- Attack and Counter-attack – A good marketing strategy anticipates the competitor’s moves and is ready to defend its own
- Use of reserves – Be judicious on what can be used or consumed to achieve what benefits
Chapter 16
– The marketing general
Karl von
Clausewitz had said that intelligent people need not make a good general. Below
are the qualities a marketing general should be –
- Flexible
- Have mental Courage
- Bold
- Knowing the facts
- Should know the rules
Strategy and
timing are the Himalayas of strategy, rest everything is catskill.
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