Out of the Box

How to Stay the Leader

By Lubicom PR on March 08 2010

Marketers have long suggested that the most coveted position in marketing is to be the leader. “Being the leader,” said a noted professor in marketing, “is like being the first man on the moon.” Some leaders were so ensconced in their leadership role that a whole generation used them as the generic term. For example, Scotch Tape or Xerox.

Imagine what it is like to wake up one morning to find out that you have been dethroned from a pedestal of power and prestige. There was a time when Kodak was king, not only in selling the lion’s share of cameras but also virtually dominating the film business. Another brand, Polaroid was the leader when it came to instant photos.

It was only a few years ago that Palm was in the coveted position of being a leader. It was a brand that at one time defined a whole generation of hand held devices that served as phones, contact lists and organizers. It had also become the generic term even for other brands. People said “put in your Palm” even if the device was another name.

But then came Blackberry which never looked back. Palm rapidly fell from grace and after many delays finally made an attempt to win back market share with several new products but analysts say that it was a case of too little too late. Still flush with cash from its earlier heydays it invested into two models that it had hoped would at least put it back on track in terms of being competitive, but from all indications that is not to be.

Marketing analysts have long debated the cause and effect for failed leaders. One theory says that being on top often distorts reality. Executives with huge egos believe in their invincibility and then are too slow to recognize change. The heads of Toyota refused to even speak to the media after it was revealed that their cars had serious production problems. It was only after mounting pressure from Congress and the public that the Japanese executives showed up to attempt to defend their safety record and to pledge change.

Some leaders fail to make progress on a new generation of demand, especially when competitors do recognize the need for change. So while Kodak was simply perfecting its cameras, a new generation of digital technology passed them by, not to speak of the new cellphone era with its built-in camera technology. The inability of these companies to look into the crystal ball leaves them in a position of passiveness that ultimately leads to their decline.

Clearly, Palm lagged behind in its technological development to move on to a new generation of hand held phones and more. It allowed Blackberry not only to win a lion’s share of new customers but even loyal Palm customers. It did not offer its own customers a natural transition to the next generation of Palm.

It is interesting to note that of thousands of new patents filed every year with the US Patent Office, only a small percentage of the products ever make it. Experts say that some of them fail because the time it took to develop the product was time used by a competing product that was already ready with a “new” more advanced product.

The ability of a leader to move with the times defines a brand that will stay the leader. Companies like IBM have successfully made the transition, largely as a result of very effective and successful research and development programs. The stress of maintaining a leadership position is ongoing, witness companies like Microsoft who is in a constant battle with Apple to gain the upper hand in technology.

Leaders, say marketing experts, are often defined by how they relate to the public. Their ability to be an educator and communicator are important qualities in developing the perception of a leader. Palm may have failed on that account as well. One of the criticisms leveled at Toyota’s executives is that they took their customers for granted and rarely ever took the trouble to communicate with them.

Like Kodak, Palm had no reason to believe that they would not stay the leader. It is almost impossible for them to prophesize whether a competitor was planning a product that would simply relegate them to the history books. The only thing that leaders can do is to continue to develop new technology or new products in the hope that their innovation will carry the day. Yes, there is a certain element of luck, but some leaders fail simply because they are not tuned to the desires of the public and as a result lag behind in development programs.

It takes good research to understand what product enhancements could get consumers to buy the next generation of products. Palm developed the Trio because people expressed frustration with having to carry more than one device: a Palm organizer and a cellphone or perhaps a beeper. But while it may have addressed that concern, it did not effectively deal with e-mails the way Blackberry did.

Emerging as the leader in any category is difficult enough, but remaining the leader for a prolonged period is even more complicated, as Palm and all those icon brands that preceded it will tell you.

Out of the Box is a collection of strategic marketing articles that Lubicom has published on various topics, trends and ideas in the marketing world. The articles have been published in the Hamodia weekly newspaper circulated on three continents to a readership of well over 100,000.

The name, "Out of the Box" is a term used frequently in business nowadays to describe creative thinking that is not the norm. It is meant to help a business pull away from the pack or separate oneself from the competition. It is to some extent fraught with risk, simply because it is not the run of the mill thinking, but it is at the same time the key to reaching the next opportunity.