Traditionally, people think of the challenger brand approach in the sense of a company that is not a market leader trying to compete. If you’re not the market leader, you can’t play by their rules and succeed because the leaders will out-spend you, out-resource you. That’s not a successful formula.
So a challenger must find a way to change the rules, change the game or introduce a new criteria for choice that gives them a disproportionate advantage in order to succeed.
A more evolved way of thinking about being a challenger brand is that you're a company that has some sense of ambition to change the world, the world at large or the world in which you operate, in an ambitious way that outstrips your available resources. We like to say that someone who has the challenger brand mindset embraces the gap between their ambition and their resources and uses that challenge to find a creative way to operate in the marketplace.
In the simplest sense, there are three kinds of challengers: Those who pick fights; those who change the rules of the game; and those who change the game entirely. A more expansive view of challenger emerges when you shift the question from, "Who am I challenging in the marketplace?," to, "What am I challenging in the broader world?" With this broader view, being a challenger becomes something to which any brand or company can aspire.
We have yet to find a company or industry that can't benefit from adopting a challenger brand approach. You may either be a company in a market that's dominated by someone else and you want to fundamentally change the landscape so you can succeed. Or, you may be a market leader who has seen growth slow or even start to fall and you need to jump on a new growth curve. Or, you may be a company who sees a significant growth opportunity that you want to pursue, but can only do so by changing your strategic approach or business model. Whatever the case, the challenger brand strategic approach is a rigorous and exciting new way to look at and approach your business, brand, operations and company culture.
Companies that adopt challenger brand principles tend to be more innovative, more dynamic, grow more rapidly and display more momentum and energy in their marketplace. Challenger brands are the ones we all notice more and that get talked about, and they are the brands and companies making a more meaningful difference in our lives. The challenger brand approach is an entirely different way of operating. And there's a big difference between just understanding what it means to be a challenger brand and actually acting like a challenger brand.