Become the market leader

Become the market leader
If you are the market leader, everyone else wants your business so everyone is your enemy. Your task is to ruthlessly defend your territory. Should your enemies are smart, they don't attack head-on. Instead, they're going to choose areas of weakness in places you haven't defended yourself and exploit the crooks to their own advantage. Over time, they will swipe your customers, bring your share, disrupt your markets, and observe in amusement as your resources are scattered fighting little distractions occasionally. That's what attackers do.

Maria Johnsen 

Now because post is about market leadership, it is just fitting that we should begin with the basics. Before we discuss what a leader has to do, let's cover off why market leadership is really a big deal to begin with. In the end, if you don't understand the worth of the market leadership position, you may not appreciate why it's extremely important to fight to ensure that it stays.


The reason market leadership is very important is not the revenue (although which is obviously very important). It isn't the status to be the leader either (although it does help build an ego). The reason why leadership is important happens because most customers would rather buy from leaders. Obviously, you'll always have the fringe-dwellers that as some form of protest support the underdog but, on the whole, most customers prefer to deal with leaders.

So customers create management. They perceive leaders being better (otherwise why do they really be leaders?) and so they perceive leaders to become safer purchase. Everyone is like sheep. When the majority votes the finest, the majority must be right. So they buy from where everybody else buys, thus strengthening the leader's position.

It is hard for a challenger brand to dislodge a market leader if the leader is actively defending territory. Time and resources have to be deployed to address over a sustained time period. Not all challengers have been in the position to attack for lengthy periods of time since it needs a significant amount of resources to be able to relentlessly pursue an innovator. (It's fun though.)

But leaders usually are not invincible. Some get arrogant and complacent, a bit too big for their boots. They get distracted by internal issues like changes to senior management, or become a victim of regulatory interference, which offers challengers a prompt opportunity to strike. Management do slip to challenger position (and it is a bit of a bumpy ride downwards). In the event that happens to you, you'll have to switch ways of become an attacker yourself.


Between the armory enjoyed through the leader are:

Greater resources to apply in defending an industry territory.

Often leaders can outgun competitors on all fronts - outspending them in advertising, having bigger plus more comprehensive distribution channels, enjoying higher brand profile, plus more.

Time to defend.

Since no-one hears advertising anymore, a challenger's message could get lost. This gives the best time to respond. A frontrunner usually hears competitive messages before a lot of the market does and merely outspends the challenger.

Distribution Channels favor the Market Leader.

Shelf space is a valuable commodity, and also the best positions favour the item that sells from the greatest volume. In other words, it favors the market leader. The same is true for distributors and third-party agents that want volume sales to earn commission.

Brand profile favors the market industry Leader.

More people buy "known" brands than "unknown" ones since positive branding instills a sense of trust. Brand profile is vital since it is the mechanism utilized by marketers to facilitate the selling process, as well as the mechanism used by consumers to reduce their purchase risk.

Creation of barriers to market entry favor the Market Leader.

There are numerous methods a Market Leader can make it hard for competitors, starting from the use of legal instruments such as patent protection (common inside the pharmaceutical and information technology industries) through creation of market barriers for example exclusive distribution contracts, exclusive supply contracts, restricted entry to essential channels, market or government monopoly status or removal of experienced staff in the market.

Using an Existing Usage favors the Market Leader.

Developing a customer base is always a strategic advantage, particularly if are closely attached to them. An established customer has a relationship already using the brand, and has a level of confidence and rely upon it that it will not have access to in an untried brand. Strategies may be deployed to "lock down" an existing customer base, such as contracting that's common in the telecommunication industry.

The size of the customer base favors the marketplace Leader.

Large customer bases enable you to use the size to your great advantage. Size offers critical mass. Cost advantages include scale, including the possibility to amortize cost across good sized quantities. In addition, having a large client base reduces risk. Those companies which depend on one or two key customers for their survival can find themselves inside a risky position if someone or both of those customers placed their business elsewhere.


 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 the competitor and consider the support that an 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 much easier than attacking as you have a greater possibility of winning. However you will find key challenger brand advantages how the leader needs to consider. These advantages include:

 The sympathy vote.
 The regulatory framework.
 Psychological advantages.
 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 strategies deployed, such as the creation of moving targets, securing fringes and niches, and pre-emptive strikes to contain competitive damage.

Maria Johnsen