And they are dead wrong. Burger King has tinkered with McDonald's formula, but is the company really that different? The true challenger is Carl's Jr., who pushed the envelope in branding, "freshened the product" and mocked its competition without forgetting how to make a great burger fast.
Unfortunately, entrepreneurs launching products that challenge market leaders today simply don't have the kind of open market space and time to incrementally grow like Carl's Jr did in the 1940s through 70's, when the company finally opened its official headquarters in Anaheim, CA.
However, Challenger Brands are succeeding everywhere because their business strategy was based on two crucial principles:
1. Question a statement as fact.
2. Take a different approach to the market leader without breaking the market rules.
My two favorite challenger brands of all-time are both airlines - JetBlue and Virgin America/Virgin Atlantic.
JetBlue and Virgin developed their business models by challenging a "given" in their market: "Who says all airline cabins must have the exact same limited functionality as planes in the 1970's?"
So they took a different approach, starting with equipping each seat with leather and personal TV's without forgetting how to fly the plane safely.
However, a novel idea is not enough to create long-term success because all Challenger Brands need a grounded branding strategy.
At Triumphant Communications, we think Challenger Branding requires 5 components and here is how JetBlue and Virgin mastered them:
1. Make a powerful statement about who you are - I can't think of more powerful contrasts in branding than these ads by Virgin:
2. Showcase the revolutionary attitude and behavior - If you have ever been on a JetBlue flight, you are constantly reminded of the "experience", which really means "difference". Having the captain coming out to the cabin in person to chat about the flight details, that's a revolution in behavior. When the flight attendants soothingly describe the details your upcoming JetBlue "Shut Eye" special, that's revolution in attitude. You won't hear that sort of sweet talk on Delta.
3. Create new aesthetics and define a new language - JetBlue officially refers to flying as "Jetting". Virgin's cabins have those cool soft neon lights complimented with the type of music you would hear at a posh Manhattan sushi bar. The idea is to make you feel like a rock star and not just another passenger.
4. Don't just evolve with society, embrace it! - You would be hard-pressed to find a more beautiful, modern airline hub than JetBlue's T5 at JFK - the only of any at the airport to have offered free wi-fi from Day One. Both airlines have eagerly harnessed social media to build customer loyalty and make major announcements. Other than travel deals and tailored engagement initiatives, Virgin America believes that Twitter and the Promoted Tweets program could potentially replace existing traditional marketing and advertising initiatives.
5. Set a standard for others to follow - The easy-to-use kiosks you now see at every airport check-in, including quick bag check lines, evolved from JetBlue and Virgin. And when leaving Houston-Bush last week, I noticed that select flights on Continental were, for the first time, offering DirectTV at every seat.
I worked with several Challenger Brands on the ground-floor level and I equate the emotions involved to golf. The process can be exhilarating and maddening at the same time, so the key is mental fortitude. A launch based on disputing the status quo will require extensive research. Relevance in the market will require a clear, coherent mission statement. And finally, prosperity will require you to stay ahead of "Goliath" through a commitment to the principles that made you different in the first place.
