Beware – Your competitor is from your category. NOT!

A few years back, while at B-School, I was introduced to management jargon and one of it was ‘Share of Wallet’. To de-jargonize, it means how much of an average human’s share of disposable income will you corner for your company, by making him / her spend on products and brands from your stable. This gives some beautiful insights about competition and from where do they come and steal part of that disposable income that could’ve come to you from the customer.

For instance, one of the biggest competitors of Indian Railways was ‘low cost airlines’. People who can afford to travel second or third A/C would rather spend a thousand Rupees more and fly to their destination. For the simple reason that they would end up saving a lot of travel time; this can be used for business or recreation as the case may be. Simple concept!

I have also heard of another concept propounded by Coke – especially in developing markets like India & China. They called it ‘Share of throat’. They realized pretty early that their biggest competition was not Pepsi in these markets but other natural, home-grown remedies to thirst – like tender coconut, buttermilk etc. Their biggest job was to convert these consumers to coke. I believe that was one of the key reasons for a Rs.5/- SKU, which was not common in most developed markets.

Coming back to the inspiration for this article – radio spots that I heard over the last few days & recent TVCs that I’ve seen.

Diwali Season has begun and every brand is roaring its heart out to reach for the customer’s pocket. And these are times when one brand understands who their real competitor is.

A few examples:

Cadbury’s Celebrations. Click here to listen to the spot.

Simple concept. Khushiyaan Baato. Share the happiness. Don’t think about meeting your old friend / boss / neighbor or whoever. Just go and meet them. Make them happy and you shall find happiness.

Pretty much straight forward. I will mind my own business kind of a spot, which is in line with its campaign in other media including TV.

Here’s the next one: World Gold Council. Click here to listen to the spot.

You can figure out who their competitor is! The electronic goods industry! Whoa! WGC actually thinks that Samsung, LG, Onida, Apple and other electronic goods manufacturers as competition. They’ve taken them head on to let us know how quickly these goods depreciate in value and how Gold can appreciate! Good idea. I will corner that corner of the pocket which was meant for the LED TV that the consumer felt the need for at his home!

And here’s the next. Morphy Richards.

I would have ideally liked to feature Croma’s Radio spot which believes a Gym Membership is competition, but couldn’t find it. But here’s the Morphy Richards TVC:

It looks like marketers have woken up to the concept of ‘Share of Wallet’ and are trying to poach from every other corner to get a bit of action for themselves! Competition is not within your category anymore. It has spread far and wide. What else can explain Gold fighting with Appliances fighting with Chinaware & Gym Memberships?

Marketers of today are fighting varied challenges.

  • Competition is not just from within the category.
  • Inflation & broader economy is making the size of the wallet smaller.
  • Pricing has become a decision point with the consumer being spoilt with choice. More effort required by Marketing & Sales to get the same amount of revenues.
  • Brand loyalty is almost a thing of past. Samsung is the new Sony. Korea is the new Japan.

Two eyes are just not enough. Look around. See the patterns and if you can’t see that almost invisible spear travelling at high speeds coming towards you, you may well be dead!

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