Book summary — The 22 Immutable Laws of Marketing
These are my Kindle notes and highlights on The 22 Immutable Laws of Marketting by Al Ries & Jack Trout.
I heard about this book from Tim Ferris blog
1. The law of Leadership
“It is better to be first than it is to be better”
Create a category where you are the first — the law of leadership
“It’s much easier to get into the mind first than to try to convince someone you have a better product than the one that didn’t get there first”
2. The Law of the Category
“If you can’t be first in a category, set up a new category you can be first in”
If the product you are working on is already in the market, pivot your marketing campaign.
“If you didn’t get into the prospect’s mind first, don’t give up hope. Find a new category you can be first in. It’s not as difficult as you might think.”
“If there’s a market for a domestic light beer, maybe there’s a market for an imported light beer.”
“The result was Amstel Light, which became the largest-selling imported light beer.”
3. The Law of the Mind
“It’s better to be first in the mind than it is to be first in the marketplace”
“The worlds first personal computer was he MITS Alrair 8800”
Du Mont invented the first commercial television set.
Duryea introduced the first automobile.
Hurley introduced the first washing machine. All are gone.”
“It’s better to be first in the prospect’s mind than first in the marketplace. Which, if anything, understates the importance of being first in the mind. Being first in the mind is everything in marketing. Being first in the marketplace is important only to the extent that it allows you to get in the mind first.”
“The law of the mind follows from the law of perception. If marketing is a battle of perception, not product, then the mind takes precedence over the marketplace.”
“Once a mind is made up, it rarely, if ever, changes. The single most wasteful thing you can do in marketing is try to change a mind.”
4. The Law of Perception
“Marketing is not a battle of products, it’s a battle of perception.”
“It’s an illusion. There is no objective reality. There are no facts. There are no best products. All that exists in the world of marketing are perceptions in the minds of the customer or prospect. The perception is the reality. Everything else is an illusion.”
“Most marketing mistakes stem from the assumption that you’re fighting a product battle rooted in reality.”
5. The Law of Focus
“The most powerful concept in marketing is owning a word in the prospect’s mind.”
“Federal Express was able to put the word overnight into the minds of its prospects because it sacrificed its product line and focused on overnight package delivery only.”
“We need an IBM machine.” Is there any doubt that a computer is being requested?
Crest … cavities
Mercedes … engineering
BMW … driving
Volvo … safety
Domino’s … home delivery
Pepsi-Cola … youth
Nordstrom … service
“The essence of marketing is narrowing the focus. You become stronger when you reduce the scope of your operations. You can’t stand for something if you chase after everything.”
6. The Law of Exclusivity
“Two companies cannot own the same word in the prospect’s mind.”
“The pink Energizer bunny that is trying to take the “long-lasting” concept away from Duracell. No matter how many bunnies Eveready throws into the fray, Duracell will still be able to hang onto the long-lasting word. Duracell got into the mind first and preempted the concept. Even the Dura part of the name communicates it.”
7. The Law of the Ladder
“The strategy to use depends on which rung you occupy on the ladder.”
“All products are not created equal. There’s a hierarchy in the mind that prospects use in making decisions.”
“On each rung is a brand name. Take the car rental category. Hertz got into the mind first and wound up on the top rung. Avis got in second and National got in third.”
“Despite the fact that Avis had a better service, and also they tried harder, people said — No, they’re not, said the prospect. They’re not on the top rung of my ladder. And to make the point, many picked up the phone and called Hertz.”
8. The Law of Duality
“In the long run, every market becomes a two-horse race.”
“In batteries, it’s Eveready and Duracell.”
“In photographic film, it’s Kodak and Fuji.”
“In rent-a-cars, it’s Hertz and Avis.”
“In hamburgers, it’s McDonald’s and Burger King”
“In cola its Coke and Pepsi”
9. The Law of the Opposite
“If you’re shooting for second place, your strategy is determined by the leader.”
“Much like a wrestler uses his opponent’s strength against him, a company should leverage the leader’s strength into a weakness. If you want to establish a firm foothold on the second rung of the ladder, study the firm above you. Where is it strong? And how do you turn that strength into a weakness?”
“You must discover the essence of the leader and then present the prospect with the opposite. (In other words, don’t try to be better, try to be different.)”
“By positioning yourself against the leader, you take business away from all the other alternatives to №1. If old people drink Coke and young people drink Pepsi, there’s nobody left to drink Royal Crown cola.”
“Yet, too many potential №2 brands try to emulate the leader. This usually is an error. You must present yourself as the alternative.”
10. The Law of Division
“Over time, a category will divide and become two or more categories.”
Instead of understanding this concept of division, many corporate leaders hold the naive belief that categories are combining. Synergy and its kissing cousin the corporate alliance are the buzzwords in the boardrooms of America. IBM, according to the New York Times, is poised “to take advantage of the coming convergence of whole industries, including television, music, publishing and computing.”
It won’t happen. Categories are dividing, not combining.
11. The Law of Perspective
“Marketing effects take place over an extended period of time”
“Chemically, alcohol is a strong depressant. But in the short term, by depressing a person’s inhibitions, alcohol acts like a stimulant.”
“Many marketing moves exhibit the same phenomenon. The long-term effects are often the exact opposite of the short-term effects. Does a sale increase a company’s business or decrease it? Obviously, in the short term, a sale increases business. But there’s more and more evidence to show that sales decrease business in the long term by educating customers not to buy at “regular” prices.”
12. The Law of Line Extension
“There’s an irresistible pressure to extend the equity of a brand.”
“One day a company is tightly focused on a single product that is highly profitable. The next day the same company is spread thin over many products and is losing money.”
“Take IBM. Years ago when IBM was focused on mainframe computers, the company made a ton of money. Today IBM is into everything and barely breaking even. In 1991, for example, IBM’s revenues were $65 billion. Yet the company wound up losing $2.8 billion.”
“In spite of evidence that line extensions don’t work, companies continue to pump them out. Here are some examples:”
Ivory soap. Ivory shampoo?
Life Savers candy. Life Savers gum?
Bic lighters. Bic pantyhose?
Chanel. Chanel for men?
Tanqueray gin. Tanqueray vodka?
Coors beer. Coors water?
Heinz ketchup. Heinz baby food?
USA Today. “USA Today on TV”?
Adidas running shoes. Adidas cologne?
Pierre Cardin clothing. Pierre Cardin wine?
Levi’s blue jeans. Levi’s shoes?
“What does IBM stand for? It used to stand for “mainframe computers.” Today it stands for everything, which means it stands for nothing.”
“For many companies, line extension is the easy way out. Launching a new brand requires not only money but also an idea or concept. For a new brand to succeed, it ought to be first in a new category (chapter 1: The Law of Leadership). Or the new brand ought to be positioned as an alternative to the leader (chapter 9: The Law of the Opposite). Companies that wait until a new market has developed often find these two leadership positions already preempted. So they fall back on the old reliable line extension approach.”
13. The Law of Sacrifice
“You have to give up something in order to get something.”
The law of sacrifice is the opposite of the law of line extension. If you want to be successful today, you should give something up. There are three things to sacrifice: product line, target market, and constant change.
“Marketing is a game of mental warfare. It’s a battle of perceptions, not products or services.”
In the retail field generally, the big successes are the specialists:
• The Limited. Upscale clothing for working women.
• The Gap. Casual clothing for the young at heart.
• Benetton. Wool and cotton clothing for young swingers.
• Victoria’s Secret. Sexy undergarments.
• Foot Locker. Athletic shoes.
• Banana Republic. Safari wear.
Look at cigarette advertisements, especially old cigarette ads. They invariably show both a man and a woman. Why? In an age when most smokers were men, cigarette manufacturers wanted to broaden their market. We got the men, let’s go out and get the women, too. So what did Philip Morris do? It narrowed the focus to men only. And then it narrowed the focus even more to a man’s man, the cowboy. The brand was called Marlboro. Today, Marlboro is the largest-selling cigarette in the world.
The target is not the market. That is, the apparent target of your marketing is not the same as the people who will actually buy your product.
The target of Marlboro advertising is the cowboy, but the market is everybody.
14. The Law of Attributes
“For every attribute, there is an opposite, effective attribute.”
“Coca-Cola was the original and thus the choice of older people. Pepsi successfully positioned itself as the choice of the younger generation.”
“Since Crest owned cavities, other toothpaste avoided cavities and jumped on other attributes like taste, whitening, breath protection, and, more recently, baking soda.”
“If McDonald’s owns kids, then Burger King has the opportunity to position itself for the older crowd, which includes any kid who doesn’t want to be perceived as a kid. That generally works out to be everyone over the age of 10 (not a bad market). To make the concept work, Burger King would have to invoke the law of sacrifice and give all the little kids to McDonald’s.”
15. The Law of Candor
“When you admit a negative, the prospect will give you a positive.”
“It goes against corporate and human nature to admit a problem. For years, the power of positive thinking has been drummed into us.”
“So it may come as a surprise to you that one of the most effective ways to get into a prospect’s mind is to first admit a negative and then twist it into a positive. “Avis is only №2 in rent-a-cars.” “With a name like Smucker’s, it has to be good.” “The 1970 VW will stay ugly longer.” “Joy. The most expensive perfume in the world.”
“Every negative statement you make about yourself is instantly accepted as truth.”
“With a name like Smucker’s, it has to be good.” Most companies, especially family companies, would never make fun of their own name. Yet the Smucker family did, which is one reason why Smucker’s is the №1 brand of jams and jellies. If your name is bad, you have two choices: change the name or make fun of it.”
16. The Law of Singularity
“In each situation, only one move will produce substantial results.”
“Many marketing people see success as the sum total of a lot of small efforts beautifully executed. They think they can pick and choose from a number of different strategies and still be successful as long as they put enough effort into the program.”
“Trying harder is not the secret of marketing success.”
“History teaches that the only thing that works in marketing is the single, bold stroke. Furthermore, in any given situation there is only one move that will produce substantial results.”
“So it is in marketing. Most often there is only one place where a competitor is vulnerable. And that place should be the focus of the entire invading force.”
“What works in marketing is the same as what works in the military: the unexpected.”
17. The Law of Unpredictability
“Unless you write your competitors’ plans, you can’t predict the future.”
“Implicit in most marketing plans is an assumption about the future. Yet marketing plans based on what will happen in the future are usually wrong.”
“Most companies live from quarterly reports to quarterly reports. That’s a recipe for problems. Companies that live by the numbers die by the numbers.”
“So what can you do? How can you best cope with unpredictability? While you can’t predict the future, you can get a handle on trends, which is a way to take advantage of change.”
“One way to cope with an unpredictable world is to build an enormous amount of flexibility into your organization.”
“There’s a difference between “predicting” the future and “taking a chance” in the future. Orville Redenbacher’s Gourmet Popping Corn took a chance that people would pay twice as much for a high-end popcorn. Not a bad risk in today’s affluent society.”
18. The Law of Success
“Success often leads to arrogance, and arrogance to failure.”
“Ego is the enemy of successful marketing. Objectivity is what’s needed.”
“When a brand is successful, the company assumes the name is the primary reason for the brand’s success. So they promptly look for other products to plaster the name on.”
“Companies like General Motors, Sears, Roebuck, and IBM became arrogant. They felt they could do anything they wanted to in the marketplace. Success leads to failure.”
19. The Law of Failure
“Failure is to be expected and accepted.”
“Too many companies try to fix things rather than drop things. “Let’s reorganize to save the situation” is their way of life.”
“American Motors should have abandoned passenger cars and focused on Jeep. IBM should have dropped copiers and Xerox should have dropped computers years before they finally recognized their mistakes.”
“The Japanese seem to be able to admit a mistake early and then make the necessary changes. Their consensus management style tends to eliminate the ego. Since a large number of people have a small piece of a big decision, there is no stigma that can be considered career damaging. In other words, it’s a lot easer to live with “We were all wrong” than the devastating “I was wrong.””
“This egoless approach is a major factor in making making the Japanese such relentless marketers. It’s not that they don’t make mistakes, but when they do, they admit them, fix them, and just keep coming.”
“The hugely successful Wal-Mart has another approach that enables the company to deal with failure. It’s called Sam Walton’s “ready, fire, aim” approach. It’s an outgrowth of his penchant for constant tinkering.”
“Walton was well aware that nobody hits the target every time. But at Wal-Mart, people aren’t punished if their experiments fail.”
20. The Law of Hype
“The situation is often the opposite of the way it appears in the press.”
“When IBM was successful, the company said very little. Now it throws a lot of press conferences. When things are going well, a company doesn’t need the hype. When you need the hype, it usually means you’re in trouble.”
“History is filled with marketing failures that were successful in the press. The Tucker 48, the U.S. Football League, Videotext, the automated factory, the personal helicopter, the manufactured home, the picturephone, polyester suits. History is filled with marketing failures that were successful in the press. The Tucker 48, the U.S. Football League, Videotext, the automated factory, the personal helicopter, the manufactured home, the picturephone, polyester suits.”
“These predictions violate the law of unpredictability. No one can predict the future, not even a sophisticated reporter for the Wall Street Journal. The only revolutions you can predict are the ones that have already started.”
“Forget the front page. If you’re looking for clues to the future, look in the back of the paper for those innocuous little stories.”
“But, for the most part, hype is hype. Real revolutions don’t arrive at high noon with marching bands and coverage on the 6:00 P.M. news. Real revolutions arrive unannounced in the middle of the night and kind of sneak up on you.”
21. The Law of Acceleration
Successful programs are not built on fads, they’re built on trends.
“Like a wave, a fad is very visible, but it goes up and down in a big hurry. Like the tide, a trend is almost invisible, but it’s very powerful over the long term.”
“Here’s the paradox. If you were faced with a rapidly rising business, with all the characteristics of a fad, the best thing you could do would be to dampen the fad. By dampening the fad, you stretch the fad out and it becomes more like a trend.”
“The Ninja turtle is a good example of a fad that collapses in a hurry because the owner of the concept got greedy. The owner fans the fad rather than dampening it.”
22. The Law of Resources
“Without adequate funding, an idea won’t get off the ground.”
“Even the best idea in the world won’t go very far without the money to get it off the ground.”
“Marketing is a game fought in the mind of the prospect. You need money to get into a mind. And you need money to stay in the mind once you get there.”
“You’ll get further with a mediocre idea and a million dollars than with a great idea alone.”
“Ideas without money are worthless. Well … not quite. But you have to use your idea to find the money, not the marketing help. The marketing can come later.”
“Some entrepreneurs see publicity as a cheap way of getting into prospects’ minds. “Free advertising” is how they see it. Publicity isn’t free. Rule of thumb: 5–10–20. A small public relations agency will want $5,000 a month to promote your product; a medium-size agency, $10,000 a month; and a big-time agency, $20,000 a month.”
“Remember: An idea without money is worthless. Be prepared to give away a lot for the funding.”
“Here is the bottom line. First get the idea, then go get the money to exploit it.”
“The more successful marketers front load their investment. In other words, they take no profit for two or three years as they plow all earnings back into marketing.”