Should you be the market leader, everyone else wants your business so everyone is your enemy. Your work is to ruthlessly defend your territory. In case your enemies are smart, they will not attack head-on. Instead, they'll choose areas of weakness in places you haven't defended yourself and exploit them to their own advantage. Over time, they will swipe your customers, bring your share, disrupt your markets, and watch in amusement because your resources are scattered fighting little distractions occasionally. That's what attackers do. international seo
Now because this post is about market leadership, it is just fitting that we should start with the basics. Before we discuss what a leader needs to do, let's cover off why market leadership is such a big deal to begin with. After all, if you don't understand the price of the market leadership position, you may not appreciate why it's so important to fight to ensure that is stays.
WHY MARKET LEADERSHIP Is vital.
The reason market leadership is very important is not the revenue (although which is obviously very important). It isn't the status of being the leader either (eventhough it does help build an ego). The reason why leadership is important is because most customers want to buy from leaders. Of course, you'll always get the fringe-dwellers that as some kind of protest support the underdog but, overall, most customers want to deal with leaders.
So customers create management. They perceive leaders to become better (otherwise why would they be leaders?) and they also perceive leaders to become a safer purchase. People are like sheep. If the majority votes you the best, the majority must be right. So they really buy from where everybody else buys, thus strengthening the leader's position.
It can be hard for a challenger brand to dislodge a market leader if the leader is actively defending territory. Resources and time have to be deployed to fight over a sustained time frame. Not all challengers are in the position to attack for very long periods of time since it requires a significant amount of resources as a way to relentlessly pursue an innovator. (It's fun though.)
But leaders usually are not invincible. Some get arrogant and complacent, too big for their boots. They get depressed by internal issues like changes to senior management, or become a victim of regulatory interference, and this offers challengers a simple opportunity to strike. Management do slip to challenger position (and it's a bit of a bumpy ride downwards). If it happens to you, you'll have to switch ways to become an attacker yourself.
ADVANTAGES Along the side of THE MARKET LEADER.
Amongst the armory enjoyed from the leader are:
Greater resources to use in defending market territory.
Often leaders can outgun competitors on all fronts - outspending them in advertising, having bigger plus much more comprehensive distribution channels, enjoying higher brand profile, plus much more.
Time to defend.
Since no-one hears advertising anymore, a challenger's message can get lost. This gives the best time to respond. A frontrunner usually hears competitive messages before a lot of the market does and simply outspends the challenger.
Distribution Channels favor the marketplace Leader.
Shelf space is really a valuable commodity, and the best positions favour the product or service that sells in the greatest volume. Quite simply, it favors industry leader. The same is true for distributors and third-party agents which need volume sales to earn commission.
Brand profile favors industry Leader.
More people buy "known" brands than "unknown" ones since positive branding instills a sense of trust. Brand profile is important since it is the mechanism utilized by marketers to facilitate the selling process, along with the mechanism used by customers to reduce their purchase risk.
Coming of barriers to market entry favor the market industry Leader.
There are numerous ways a Market Leader makes it hard for competitors, starting from the use of legal instruments such as patent protection (common from the pharmaceutical and information technology industries) through creation of market barriers including exclusive distribution contracts, exclusive supply contracts, restricted use of essential channels, market or government monopoly status or removing experienced staff from the market.
Using an Existing Usage favors the Market Leader.
Using a customer base is always a strategic advantage, specifically if you are closely linked to them. An established customer carries a relationship already with all the brand, and has that confidence and rely upon it that it will not need in an untried brand. Strategies can be deployed to "lock down" an existing customer base, such as contracting that's common in the telecommunication industry.
How big is the customer base favors the market industry Leader.
Large customer bases allow you to use the size to your great advantage. Size offers critical mass. Cost advantages have scale, including the chance to amortize cost across vast quantities. In addition, having a large customer base reduces risk. Those businesses that depend on one or two key customers for his or her survival can find themselves in a risky position if one or both of those customers get their business elsewhere.
STRATEGIES Management DEPLOY.
A market leader always plays defense.
They counter an attack with equal or greater force.
They defend important markets.
They remain vigilant in scanning for potential attackers. (This implies they must assess the strength of every competitor and consider the support that the attacker might muster from allies.)
They attack themselves before a competitor gets the opportunity to attack them.
To be the leader is the advantageous position. Playing defense is easier than attacking when you have a greater possibility of winning. However you will find key challenger brand advantages that the leader needs to consider. These advantages include:
The sympathy vote.
The regulatory framework.
Challenger Brands are in good company.
Challenger brand believability.
Market leader complacency.
To effectively negate a challenger brand's competitive attacks, an industry leader's important territories have to be identified, defense plans laid, and techniques deployed, such as the coming of moving targets, securing fringes and niches, and pre-emptive strikes to contain competitive damage. international seo