Most everyone has heard of a challenger brand.
Think about IKEA. The Swedish company that single-handedly transformed the designer furniture space when they created a brand that offered accessible, flat-pack furniture for a highly affordable price. Or Airbnb, who continues to disrupt the hospitality industry.
A challenger is not a brand that challenges somebody, but rather a brand that challenges something – something that the brand is confident, needs a change.
Challenger brands aren’t typically in a hurry. Just like the tortoise, they often approach “the race” with a slow, but steady and focused pace. They’re more like the long-distance runner than the sprinter.
They make it a point to identify a gap in the marketplace and clearly show how their product or solution can effectively address unmet needs to make customers’ lives better.
So, how exactly can building product challenger brands make their mark in a crowded marketplace? Following are four strategies, designed to challenge industry “Goliaths.”
Avoid going head-to-head
Building products challenger brands understand that if they attempt to go toe-to-toe against the market leader, they’re not likely to succeed. The odds simply aren’t in their favor.
Trying to knock out the competition may sound like a good idea, but that can take a lot of resources and effort – and a brand could still end up on the losing side of the head-to-head match.
A better approach for challenger brands is to effectively differentiate their products from the commoditized competition. By promoting unique features, exemplary warranties, top-notch service and support or even a commitment to social responsibility, challenger brands can appeal to specific – and influential – segments of the market. Allowing them to stand out from the existing “leader of the pack.”
For instance, Dyson became a well-known aspirational vacuum cleaner brand based primarily on the introduction of a first-of-its-kind “swivel” technology, that makes the job of navigating around corners and objects easier.
Establish a brand position that resonates
While market leaders often follow the mainstream, challenger brands set their sights in new directions. They find unique selling propositions that defines them.
Similar to TOMS® Shoes One for One campaign, Bombas Socks donates an item on the buyer’s behalf for every item purchased… connecting people through a common feeling of doing good. The company offers a “Happiness Guarantee” and will replace a customer’s socks – even if the socks got chewed up by the dog or disappeared in the washer – no questions asked.
Another notable example is REI’s #OptOutside campaign, which encourages target audiences to enjoy nature and the outdoors on the day after Thanksgiving… instead of spending the day shopping in the same retail marketplace where the leaders promote their offers on that day.
By standing for something, these brands are able to generate emotional equity. Which can go a long way in developing true differentiation.
Innovate… and then innovate some more
Reinventing the marketplace is a proven way to get noticed. By reimagining their categories, companies such as Amazon, Netflix and Uber have altered our past frames-of-reference and as such, have dramatically shifted our current expectations.
What is most important is that a challenger brand constantly stretches itself to grow and evolve. Complacency doesn’t have a place in the vocabulary of a challenger brand.
Whether it’s introducing a new product, feature, process, technology or way of doing something… brands that challenge the status quo can create staying power while developing valuable “equity”.
For instance, a brand may introduce a faster-drying, VOC-free paint. Or a plumbing connection system that significantly minimizes the chance for leaks. Or tile installation products that are healthier for installers and the environment.
Says Martin Moore of Nielsen’s Innovation Practice, “Even the most established categories change over time – and not simply in a passive sense but often as the deliberate result of one brand’s ingenuity. In fact, a category that appears stable may be just one critical innovation away from awarding one brand a significant long-term advantage.”
Create an exceptional customer experience
Today’s customers are looking for standout experiences.
Challenger brands who can outshine their competitors when it comes to customer service or in-store and online experiences will earn high marks and recognition. If a customer has a better experience using a new product or service than the one they have been using, they are likely to gravitate more often to that new brand. According to a survey by, Vision Critical, 86% of buyers will pay more for a better customer experience.
For example, while a smaller hardware store or lumberyard can’t offer many of the conveniences that a big box store such as Home Depot or Lowe’s can offer, they can provide a personalized experience that might be harder to come by at a chain retailer. For example, they might provide coffee and donuts once a week to contractors who arrive at the store early to pick up supplies. Or host invitation-only private customer appreciation events and training where contractors can participate in workshops to hone their skills.
Bringing it Home
Successful challenger brands excel at disrupting the norm in a way that makes stakeholders see the world differently. Whether a challenger brand is motivated by idealism, solving a pressing challenge or simply a desire to introduce a new product or solution to the market… there are plenty of opportunities to create long term wins.
Is your brand up to the challenge? Download our whitepaper to learn more.
