Market Leader vs Market Followers

Last Updated: 31 Mar 2020
Pages: 6 Views: 514

The article is aiming to study how big brands are losing their market share & what changes they are bringing in their marketing strategy to cope up with the current market scenario or to regain their market share. This study is focused on leadership in Indian market on various segments, Brand loyalty, and brand differentiation. This study focus on current market scenario with changing trends of market share in various segments.


Competition essentially means a fight and a monopolist enjoys a hold over the market and has control over price and customer. With the adoption of pro-competition policies by the government - Air India have been exposed to constantly losing market share in favor of private carriers like Kingfisher, Jet airways, Air Sahara, Spice Jet, Lufthansa and others.

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It is tough condition for the marketers, because if you are inefficient, the market forces would edge you out of the marketplace. Hence, competition means hard work. It is a constant struggle to outperform the rivals. Competition is consumer friendly, but not market friendly. Binaca is a brand that existed only in yesteryears.Binaca could not compete with the market competition & finally failed. The most remembered thing about Binaca is its conversion to Cibaca. So, why the company re-launched Binaca and not Cibaca? Cibaca changed the brand name Binaca to Cibaca when it was sold to another company. While Dabur bought Binaca, Colgate Palmolive bought Cibaca. Dabur has launched Binaca and now we have both Binaca and Cibaca in the market. (Though Binaca was toothpaste and Cibaca is currently being sold only as a toothbrush.) Brand is re-launched to leverage on past brand equity.

Kelvinator India refrigerators has led a yo-yo type life till now. There have been frequent changes of ownership, which also included an 18-month stint with the enemy, Whirlpool. Worldwide, the Electrolux brand owns Kelvinator. During the period 1997-98, when Electrolux was just entering India, it did not have the capacity to hold on to the sales of Kelvinator. It had to sell it to Whirlpool to sustain sales. Whirlpool took advantage of the situation and milked the brand in that time. After the stipulated period of 18 months, Electrolux took it back. Since then, it has been contributing to a steady 65-70% of the company's revenues, a successful re-launches. Electrolux saved on a lot of costs it would have probably incurred had it launched a new brand.

One of the most important assets that the marketer can possess is the trust of the customers. A brand is the interface between the marketers and the customers. It signifies the touching point between the marketing efforts and its effect on customers, either positive or negative. As the marketers are trading on the slippery ground, if they compromise on quality they can’t prevent consumer to switch brand to another.

According to Rap P, Stan and Tom Collins, in their book –The great Marketing turn grounds- “The ability of the manufacturers to copy one another’s most successful product and the brand hopping encouraged by the tempting discounts may be seriously weakening the grip of the loyalty in many categories”

Erosion of the brand loyalty has become one of the serious concerns now. The magazine ad week’s marketing week of US suggests that “The belief that once consumers buy a brand, they will stay there, is not true. The percentage of consumers who wished to stick to major brands dropped from 80 to 60 percent during an eight year period”.

In today’s market scenario; the leaders are losing their market share & turning to followers for the sense of emergency. “Eye-catching colors and gee-whiz features aren't enough for successful products and services today. To rise above the ‘sea of sameness’, companies need to be different in a way that is elemental—and game-changing. According to HBS professor Youngme Moon.”

Brand Loyalty

Brand loyalty is harder to come by today as different brands are coming with too many choices and not with enough differences. Well known brands command a price premium. Japanese companies such as Sony and Toyota have built a huge brand loyal market .At the same time, developing a branded product loyal to the customer requires a great deal of long term investment, especially for advertising, promotion & packaging.

Woodland is a brand that has built its brand equity on the pillars of being sturdy and durable with futuristic designs. It has also forayed into apparels and accessories. To maintain their positioning in the mind of consumer the brand has also introduced more specialized products like Yoga collection, Kids collection and the Woods collection. The brand has customized products for the adventure enthusiasts and keeps adding new technologies to make their products the ideal choice for all adventure lovers. Now, the brand has been focusing on eco-friendly products and uses raw materials that are less harmful to the environment.

We’re familiar with the acronym WIIFM, which stands for “What’s in it for me?” This is the exact question that the consumers are asking themselves, and the brands need to be able to answer them properly. If they are unable to do the same the consumer will switch from one brand to another. The economics of customer retention makes a compelling case for relationship marketing. It costs approximately five times more to attract a customer than to keep a customer. So losing market share is very serious issue for market leaders at present.

Brand Loyalty is the consumer's conscious or unconscious decision, expressed through intention or behavior, to repurchase a brand continually. It occurs because the consumer perceives that the brand offers the right product features, image, or level of quality at the right price.

In today’s marketing environment, market advertisers are trying to break consumer habits, and helping them to acquire new habits, and reinforce those habits by reminding consumers of the value of their purchase and encourage them to continue purchasing those products in the future. The proactive approaches of rivals are compelling the market leaders to lose their market share. Brand Differentiation

The brands want to remain differentiated from other brands; they will survive in the market & enjoy customer loyalty if they’ll be able to position themselves different from their competitor in the mind of consumer as well as in the market. Brands are investing on their advertising & promotion to differentiate themselves from others. FMCG major Dabur has undertaken a 360 degree rebranding exercise for its brand Real and has introduced new packaging, a new brand ambassador and communication activities.

The company has reportedly spent close to Rs 7-8 crore on the whole exercise. Currently, the brand is going ahead with the 360 degree communication plan, which includes innovative OOH campaign in select cities, in-cinema advertising, TVC, radio, DTH for the very first time and print advertising, to remain differentiated from other brands.

There are various ways they can achieve this aim. The brand differentiation is basically brought by positioning of brands. , some of the world's most iconic brands are starting the year with a new look. ITV has ditched its yellow and blue boxes, computer chip maker Intel has introduced a new strapline, and telecommunications giant AT&T has undergone a facelift.Airtel has taken the leap and revamped its logo, and the brand is on media overdrive to drive home the point about its new avatar. Brand differentiation can also be achieved by unique selling position of the brand and for increasing the brand value and brand equity. For every business, the health of its brand is key to its success. “The brand is the emotional heart of the business," says Clare Salmon, director of marketing and strategy at ITV. "If the heart stops beating, the beast is going to die."

Differentiation attacks the fundamental basis of competition. It makes the product dissimilar and hence, less substitutable.” A general class of products is differentiated if any significant basis exists for distinguishing the good or service of one seller from that of another. Such a basis may be real or fancied, as long as it is of any importance whatever to buyer, and leads to a preference for one variety of the product over another.” According to Chamberlin, Edword, The theory of monopolistic competition, Cambridge, Mass, Harvard University Press, 1956.p.66. Current Market scenario.

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Market Leader vs Market Followers. (2017, Mar 18). Retrieved from

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