Successful challenger brands, including Indian IT giants TCS, Infosys, and Wipro, and international brands such as Zara, Sriracha Hot Sauce, Zoom, Canva, Naturals Ice Cream, and Naturals Salon, have achieved success without relying on traditional advertising methods.
These challenger brands have leveraged the benefits of a digitized, socially interconnected world to build their brands and grow their businesses.
Challenger Branding vs Guerrilla Marketing
Challenger branding is different from conventional guerrilla marketing because it focuses on levers such as personal branding, country of origin, and ecological sustainability not just Kotler’s 4Ps. By using content marketing, social media, influencer marketing, and digital ambushes, upstart brands can reach their target audiences more effectively than traditional incumbents who may struggle to adjust their marketing and branding strategies.
What is a challenger brand?
To identify whether your company is an upstart brand and see where your competition is positioned, you can use the Upstart FourSquare Model. This measures the relevance of a product in a company’s portfolio based on market share and growth axes. Depending on your position in the model, you can adopt different communication strategies to:
- defend your territory
- reassure existing customers
- attract new ones
- focus on becoming a niche player
Best time to be a challenger brand is now!
In a connected world, digitization removes many impediments to traditional competition, creating a level global playing field where the location of your organization or its country of origin is no longer an obstacle to success. Products and services that can be delivered electronically can be produced anywhere in the world and delivered globally . Even if you have to ship products, innovations in global supply chains have shrunk the time and cost required for that.
The internet has also allowed ever-smaller interest groups to proliferate, creating a long-tail of needs that companies must cater to become commercially viable. Upstart brands can benefit from building a global brand identity while customizing some branding features to be relevant locally. Traditional mass-marketers must also adapt their messaging to suit different audiences and tailor custom messages for different audiences for the same products.
Challenger Brand Positioning and Communication Responses
| Quadrant | Positioning | Recommended Communication Strategy |
| Champion | Leader; addresses either many people with one offering or sells a broad offering; should adopt the best practices of the upstarts and use its superior size to stifle their growth | Aggressive leadership stance to defend territory; proactive communication in new markets/segments targeted by the upstarts |
| Mature | Large player that may be suffering from a lack of differentiation; should reconsider value proposition and adopt the best practices of the upstarts; can gain market share by attacking the champion’s weaker markets or by acquiring another firm | Communication to reassure existing customers and attract newer customers; focus on highlighting their differentiated value proposition |
| Upstarts | Superior value proposition relative to incumbents; focus on increasing market share and building sticky relationships with clients and other stakeholders. The window of growth available for the upstart to achieve a threshold market share is the time taken by the champion to successfully react to the new business model. | Focused communication to potential clients and other elements of the ecosystem; once a revenue threshold is reached, should communicate aggressively to consolidate position and rapidly acquire market share |
| Stragglers | Typically, firms that were disrupted by the upstarts and for legacy reasons have not yet been able to adapt to the new business model; can focus on becoming niche players and building a specialisation | Aggressive communication around the chosen niche; need to win over the influencers and stop defection of existing clients through data-driven, credible communications |
Source: Marketing Without Money, Bloomsbury, 2021. Author: Jessie Paul.
Upstart brands have the opportunity to take advantage of the benefits of a digitized world to build their brands and grow their businesses. Traditional incumbents must adapt to the new marketing landscape to remain relevant.
