1. The Law of Leadership: It's better to be first than it is to be better.
The essence of marketing is creating a market niche where you can take a leading position. It's easier to be the first to enter the consumer's mind than to convince them that you offer a better product than the competitor who holds the leading position.
One reason a brand remains a leader is that its name becomes generic (e.g., 'Adidas' instead of 'sports shoes').
If the secret to success is being the first to enter the consumer's mind, what strategy do most companies use? Product improvement strategies. One of the more popular strategies is called benchmarking. This means comparing your product or service with the best in the industry. It is an essential element of the process we usually call total quality management. Unfortunately, benchmarking is not effective. Regardless of the actual situation, people believe that the first product in a certain industry is the best. Marketing is a battle of perceptions, not a battle of products.
2. The Law of the Niche: If you can't be first in a category, set up a new category you can be first in.
When launching a new product on the market, you should not ask yourself how it is better than the competition, but rather, what it is best at! In other words, what makes your product the leader in a particular niche.
If you are the first in a certain niche, promote the niche. No competitor threatens you.
3. The Law of Mind: It's better to be first in the mind than to be first in the marketplace.
Being first in the marketplace is important only because it gives you the opportunity to be first in the consumer's mind. The Law of Mind derives from the Law of Perception. If marketing is a battle of perceptions and not products, then mind takes precedence over the marketplace. This is why countless entrepreneurs with revolutionary ideas fail every year because they cannot transfer their ideas into the minds of potential consumers.
If you want to make a really good impression on someone, you must not enter their mind slowly, almost unnoticed, and then gradually convince them that you are trustworthy. Images do not form slowly but instantly. You must blast your way into the consumer's mind.
4. The Law of Perception: Marketing is not a battle of products, but a battle of perceptions.
It's hard to convince consumers otherwise because they assume they are always right. The perception that exists only in their minds is often interpreted as universal truth. Consumers rarely, if ever, make mistakes. They are convinced of this.
The battle is further complicated by the fact that consumers make purchasing decisions based on secondary perceptions. Instead of relying on their own judgment, they make purchasing decisions based on someone else's perception of reality. This principle is called "everyone knows." Everyone knows that Japanese cars are of higher quality than American ones. If you ask customers about their experiences with certain products, most will say they have no direct experience. If they do, they often adjust it to the general opinion.
5. The Law of Focus: The most powerful marketing concept is owning a word in the prospect's mind.
A company can achieve remarkable success if it finds a convincing keyword and implants it in the minds of its consumers. The word should not be complicated or made-up. The best are simple expressions that everyone understands.
The most effective words are simple and emphasize a benefit. Regardless of the complexity of the product and the difficulty of the market, it is better to focus on a single word that highlights a benefit than on two, three, or even four expressions that denote a product feature. (Volvo – safety, BMX – riding, Aquafresh – cavities)
Words that will be effective in the market can be related to benefits (preventing tooth decay), services (home delivery), consumers (younger people), or sales (preferred brand).
The essence of marketing is in managing focus. A company becomes stronger by narrowing its field of operation. You cannot do one thing and fight for something else at the same time.
If you want to succeed with high-quality products, you must also emphasize a high price.
Has any company ever declared itself as low-quality? No, everyone emphasizes quality. Therefore, this message has no real power.
6. The Law of Exclusivity: Two companies cannot own the same word in the prospect's mind.
Many entrepreneurs still violate the Law of Exclusivity. If we try to change the consumer's opinion, we usually only reinforce the position of our competitor.
7. The Law of the Ladder: The strategy to use depends on which rung you occupy on the ladder.
The mind is selective. Based on their ladders, consumers decide which information to accept and which to reject. The mind accepts only new information that is consistent with the old information on this ladder. Everything else is ignored.
Products we use every day (cigarettes, beer, bread, toothpaste) are high-interest products. The consumer's ladder has many rungs. Products we buy only occasionally (furniture, suitcases) have only a few rungs on their ladder. Products associated with a high degree of personal image (car, watch, camera) also fall into the high-interest category with many rungs on the ladder, even though we decide to purchase them only occasionally. There is a strong connection between market share and position on the ladder in the consumer's mind. A brand has twice the market share of the brand below it and half the market share of the brand above it.
How many rungs can a ladder have at most? Consumers typically form seven. The average human mind can handle only seven units at once. That's why the number seven is so common in data we need to remember: seven wonders of the world, Snow White and the seven dwarfs, etc. Sometimes the ladder, or even the category, is too small. It might be better to be a small fish in a big pond than a big fish in a small pond. In other words, sometimes it's better to be third on a long ladder than first on a short one.
8. The Law of Duality: In the long run, every market becomes a two-horse race.
We must realize that, in the long run, only two competing companies can exist in the market, and we must shape our short-term strategy accordingly.
The consumer believes that marketing is a battle between products. The first two brands maintain their position precisely based on such thinking: "Surely they are the best, as they are the leading brands."
9. The Law of the Opposite: If you're shooting for second place, your strategy is determined by the leader.
You must discover what the essence of the leader is, and then present yourself to consumers in contrast to that. (Don't try to be better, be different). It is usually a battle between a newcomer and a reliable and established brand.
Buyers of a certain product can be divided into two groups. The first want to buy from the leader, while the second do not want to buy its products. The company that holds the second position in the market must address the second group.
To effectively highlight the downside of a competing product, there must be some truth to it.
10. The Law of Division: Over time, a category will divide into two or more categories.
In many companies, people in leadership positions do not understand the Law of Division and naively believe that categories are merging.
Companies make a big mistake when they try to establish one brand in multiple categories.
It's better to be early than late. If you're not prepared to wait for the niche to develop, you can't be the first to enter the consumer's mind.
11. The Law of Perspective: Marketing effects take place over an extended period of time.
Does a sale increase or decrease a company's business? Obviously, it boosts sales in the short term, but there is increasing evidence that it decreases business in the long term, as customers get used to low prices and no longer want to buy at regular prices.
Coupons, sales, and discounts signal to customers to buy when they can purchase products at a lower price.
In many areas (spending money, drugs, sex), the long-term effects of our actions are often the opposite of the short-term ones. Why is it so difficult to extend marketing effects over a longer period?
The effects of brand extension are hard to notice, especially if you don't know what to expect. Managers who are only concerned with the next quarterly report have the most trouble with this. (If a bullet took five years to hit the target, very few people would be convicted of murder.)
12. The Law of Line Extension: There's an irresistible pressure to extend the equity of the brand.
Upon establishment, a company usually focuses on a single, most profitable product, but over time finds itself owning a multitude of products that only lose money.
Line extension in the narrow sense means introducing new products under the brand name of a successful product (A-1, steak sauce) into the market (A1, chicken sauce). In the long run and in the presence of serious competition, line extension almost never brings success. A very popular way to expand market share is new flavors of food. More flavors, bigger market share. It sounds good, but it's not effective. A new product under the same brand is usually unsuccessful in the long run, but it brings a lot of profit in the short term. The antidote to line extension is entrepreneurial courage and the production of goods with limited supply.
13. The Law of Sacrifice: You have to give up something to get something.
There are three things you can sacrifice: products, target market, or constant change.
- Products: A broad product line is a guarantee for failure. If you want to be successful, you must narrow the production line, not expand it. Companies that do not specialize in any area are usually not successful.
- Market: The market is not the goal. This means that the goal of marketing is not the people who will actually buy your product. Even though Pepsi's target markets were teenagers, people of all generations bought its products.
- Constant change: Who says you have to change your strategy every year when you review business results? If you try to follow all the marketing twists and turns, you will likely be blown off course. The easiest way to maintain a stable position is not to change it.
14. The Law of Attributes: For every attribute, there is an opposite, effective attribute.
It's much better to find an opposite attribute from the one your competitor's products are known for, as you will be playing against them. The key word is opposition; similarity will not bring you success.
Marketing is a battle of ideas. So, if you want to succeed, you must have an idea or focus on an attribute on which you will base your entire marketing. But not all attributes are equal, you might think. True, some seem more important to customers than others. Try and choose the most important attribute of your product.
The Law of Exclusivity emphasizes a simple truth: when an attribute has already been successfully promoted by a competitor, you can no longer use it. You must focus on a less important characteristic and accept a smaller share in this category. Your task is to exploit the second attribute, dramatize its importance, and thus increase your market share.
15. The Law of Candor: When you admit a negative, the prospect will give you a positive.
Because candor is calming. Every negative statement you make about yourself, consumers immediately accept as true, while positive statements you make about yourself (especially in advertisements) seem at best dubious. To satisfy customers, you must support the positive statement with evidence. On the other hand, you do not need to prove the truth of the negative statement.
Few companies admit they have problems. But if a company does, people usually listen almost instinctively. Think about how quickly you are ready to help when someone talks about their problems. What if someone tells you that everything is going smoothly? You quickly lose interest in their story, don't you?
The Law of Candor must be applied carefully and with great experience. What we present as a weakness of the product must be generally accepted as a weakness. It must trigger an immediate agreement with consumers. If we do not immediately explain why the product has a certain weakness, the consumer will be confused and wonder: "What do they even mean by that?" Furthermore, you must quickly turn the weakness into an advantage. The purpose of candor is not to apologize, but to emphasize the advantage that will convince potential buyers. This law confirms the old saying: Honesty is the best policy.
16. The Law of Singularity: In each situation, only one move will produce substantial results.
History teaches us that the only thing that works in marketing is a unique and bold move. Since the costs of wrong decisions are high, management cannot afford to leave decision-making on important marketing matters to lower levels.
It's hard to find a unique move if you are trapped in the office and not involved in the process.
17. The Law of Unpredictability: Unless you write your competitor's plans, you can't predict the future.
Good short-term planning requires introducing a word or idea that will differentiate your company and products from the competition. Then it is necessary to find an appropriate long-term marketing direction that will develop this idea as best as possible. This is not a long-term plan, but a long-term direction. The danger of trends lies in unpredictability. Introducing changes is not easy, but it is the only answer to how to deal with an unpredictable future.
18. The Law of Success: Success often leads to arrogance, and arrogance to failure.
Ego is the enemy of successful marketing. What is really needed is objectivity. When a brand is successful, the company usually assumes that the basic reason for success is its name. Therefore, they start looking for new products to label with the same name. In fact, they should do the opposite. The brand did not become successful because of its name (although it is true that a bad name can prevent success), but because your marketing moves were good. It's better to see once than to hear a hundred times.
19. The Law of Failure: Failure is to be expected and accepted.
Japanese: It's not that they don't make mistakes, but when they make a mistake, they admit it, correct it, and make new decisions.
20. The Law of Publicity: The situation is often the opposite of the way it appears in the press.
When everything is fine, a company doesn't need publicity. If it needs it, it's probably in trouble. The essence of publicity is not just that the new product will be successful, but also that existing products will henceforth be considered obsolete.
21. The Law of Acceleration: Successful programs are not built on fads, but on trends.
Paradox: If you are facing a constantly growing business, with all the characteristics of a fad, the best thing you can do is to destroy that fad. Thus, you stretch it and it becomes more like a trend. The best and most profitable marketing is a long-term trend.
22. The Law of Resources: Without adequate funding, an idea won't get off the ground.
Marketing is a battle in the minds of consumers, so you need money to get your products into their minds. You also need money to stay there. With an average idea and a million dollars, you'll go further than with a brilliant idea and no money. First, find the idea, then try to secure the funds to realize it. The most successful marketers increase their investments. In other words, invest all profits back into marketing for at least three years.
Summary from the book 22 Immutable Laws of Marketing by Al Ries and Jack Trout
