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ASSIGNMENT: BOOK SUMMARY

The 22 Immutable Laws of Mar et!"# B$ Al R!es a"% &a' Trout

BBA(S)*+(+++ SE,TION: A

Subm!tte% to: Mr

Summar$:
*- The Law of Lea%ersh!.: It is better to be first than be better 2- The Law of the ,ate#or$: If you cant be the first in a category, set up a new category that you can be first in /- The Law of the M!"%: Its better to be first in the mind than to be first in the marketplace 0- The Law of )er'e.t!o": marketing is not a battle of products, its a battle of perceptions 1- The Law of 2o'us: The most powerful concept in marketing is owning a word in the prospects mind 3- The Law of E4'lus!5!t$: Two companies cannot own the same word in the prospects mind 6- The Law of the La%%er: The strategy to use depends on which rung you occupy on the ladder 7- The Law of 8ual!t$: In the long run, every market becomes a two horse race 9- The Law of the O..os!te: If youre shooting for second place, your strategy is determined by the leader *+- The Law of 8!5!s!o": Over time, a category will divide and become two or more categories **- The Law of )ers.e't!5e : Marketing effects take place over an extended period of time *2- The Law of L!"e E4te"s!o": Theres an irresistible pressure to extend the equity of the brand */- The Law of Sa'r!f!'e : ou have to give up something in order to get something *0- The Law of Attr!butes :!or every attribute ther is an opposite, effective attribute *1- The Law of ,a"%or : "hen you admit a negative, the prospect will give you a positive *3- The Law of S!"#ular!t$ :In each situation, only one move will produce substantial results *6- The Law of U".re%!'tab!l!t$ : #nless you write your competitors plans, you cant predict the future *7- The Law of Su''ess : $uccess often leads to arrogance, and arrogance to failure *9- The Law of 2a!lure : !ailure is to be expected and accepted 2+- The Law of :$.e : The situation is often the opposite of the way it appears in the press 2*- The Law of A''elerat!o" : $uccessful programs are not built on fads, they are built on trends 22- The Law of Resour'es : "ithout adequate funding an idea wont get off the ground

*- The Law of Lea%ersh!. The law of leadership is convincing people that you are the first in a particular market It is easier to convince someone that you are first rather than convince them that you have a better product The leading brand in a category are usually the first in the mind of consumers %eople tend to stick with what theyve got One reason why the first brand in a category is the best known is because it tends to become generic Marketing is a battle of perceptions, not products & if you are the first then you must be the best 'even if your product is inferior, it is seen as being the best( 2- The Law of the ,ate#or$ If you are not the first product in the market, you should try to find a new category and be the first in that category I)M was the first in computers, but *+, was the first in minicomputers *ell was not the first computer seller, but they were the first in selling computers over the phone +veryone is interested in what is new, not necessarily what is better /- The Law of the M!"% If marketing is a battle of perception, not product, then the mind takes precedence over the marketplace The problem is getting the idea or concept into the persons mind ou cannot change a persons mind & once they perceive a company of being one thing, they forever feel that it is that thing eg- .erox will always be a photocopier company and never a computer company, no matter how hard they try ou have to blast your way into consumers minds $ometimes a simple and easy way of getting into a prospects mind is to have an easy to remember name, such as /pple computers as opposed to the MIT$ /ltair 0011 0- The Law of )er'e.t!o" /ll that exists in marketing is the perception in the mind of the consumers The only reality that you can be sure about is in your perceptions The product itself is not central to the marketing, it is the perception in the mind of the consumers that is the important thing If you tell someone in 2apan that you bought a 3onda, they would automatically assume that you are talking about a motorcycle & if you told someone in 4ew ork that you bought a 3onda they would assume that you are talking about a car5 3onda is perceived differently in different markets Taste tests prove that %epsi tastes better than ,oke, but ,oke is perceived to be the better drink because a( it was the first and b( because its marketing makes you

assume that it is the best and puts a perception into your mind about ,oke and about those who consume it The 6everybody knows7 principle is that 6everybody knows7 that 8olvos are the safest cars in the world & there is a perception that they are the safest, but have you ever tried driving one 'or crashing one9( Marketing is not a battle of products, but a battle of perceptions

1- The Law of 2o'us / company has to be focused on its product, its brand and its category5 )ranching out into different markets can kill the company +very product or brand has to have its own word & 8olvo owns the word 6$afety7, .erox owns the word 6photocopier7 etc The halo effect is when one attribute gives rise to others eg- if your spaghetti sauce owns the word 6thick7 it also implies that it is tasty, has nourishing ingredients etc )roadening the scope of your word means certain death for the product eg- /tari didnt want to be known as :ust a video game company, they also wanted to own the word 6computer7 when they branched out into computers & but the word 6computer7 was already I)Ms word '6I want to buy an I)M7 definitely means 6I want to buy a computer7( ou cant narrow your focus with quality & everybody says that they are the best because they produce quality goods & as a result nobody believes a company when they push the 6quality7 line 3- The Law of E4'lus!5!t$ ou cannot own another companys word5 !ederal +xpress will never own the word 6worldwide7 & *3; does< +nergi=er will never own the word 6long>lasting7 & *uracell does The law of exclusivity states that if a word is owned by another company, the chances are that you will never be able to own that word, so find a different word 6- The Law of the La%%er /ll products are not created equal5 There is a hierarchy in the mind that prospects use in making decisions Marketing should be based on where on the ladder you stand5 If you are the first in the category, then you occupy the minds of most consumers so then you are on the top rung, if you get in second, you are a rung down etc "hen /vis admitted to its public that they were number ? in the car rental market, they started to do better business ie- 6"e may be the number ? company, but we try harder7 was their slogan5 Their honesty and the perception created by the fact that they were number ? and they are really trying harder to become number @ won them many more customers and lots of money There is a maximum of seven rungs on a ladder because consumers often find it difficult to remember more than seven brands of any particular product & that is why A is a popular number5

7- The Law of 8ual!t$ "hen you take the long view of marketing you usually find that the battle ends up between two ma:or players & usually the original brand and the upstart brand It might take a season or two to eliminate or make redundant the minor players 'eg- video games( or it may take decades 'eg- telephone companies( 2ack "elch- 6Only companies that are number @ or number ? in their markets could win in that increasingly competitive global arena7 In a developing market, the number B or C brand might be popular, because customers dont always know which brands are the leaders, so they pick interesting looking ones5 Once they are educated as to which is the leading company, the Brd or Cth companies tend to be eliminated or ignored 9- The Law of the O..os!te ou must find the strength in the opposition and turn it into a weakness by promoting your product as the opposite eg- ,oke is the original which implies that older people drink it5 $o %epsi came up with the 6%epsi Deneration7 & the choice of the new generation )y making yourself the opposite, you take business away from all other alternatives to number one & if old people drink coke and young people drink %epsi, then who is left E *ont simply knock the opposition & promote your product as well eg- This mouthwash wont leave you smelling like a hospital & it is the good tasting mouthwash that also kills germs *+- The Law of 8!5!s!o" ,ategories that were at one time general 'eg- computers( tend to break up into other categories 'eg- desktops, laptops, minicomputers, mainframes etc( /ddress each emerging category with a different brand name '8olkswagen works well with small, cheap and affordable cars, but a 8olkswagen name on a luxury car will not work( Det into the new categories as soon as possible to be the first & but be careful not to extend the brand name so that it hurts the original brand

**- The Law of )ers.e't!5e "hat is alcoholE Is it a stimulant 'eg- workers look alive and refreshed in the pub after work( or is it a depressant 'workers who drink too much fall asleep or get groggy after a while(E This is a perception & it depends how you look at it

If a business runs continuous sales, they will not do well & if they constantly have sales they tell their customers that they dont have good prices and that they should always wait for the next sale to make a purchase5 3ow do your prospects view your productE Matters alot5

*2- The Law of L!"e E4te"s!o" )y extending your line, you run the risk of losing sales of your original product and also total market share +xtending your line causes confusion Fiding the wave of the success of one line can destroy that line in the end "hen you be all things to all people you inevitably wind up in trouble ;ine extension can be a winner in the short term but a loser in the long term & more is less 4arrow the focus to build a position in the prospects mind The alternative to line extension is launching a new brand5 This is costly and time consuming but it is the best way to introduce a new product because it doesnt hurt the original brand */- The Law of Sa'r!f!'e If you want to be successful, you have to reduce your product line, not expand it5 ou may have to give up part of the market to build a perception about the product5 This can be a winning strategy in the long term /n example of the law of sacrifice is when !ed+x sacrificed the potential market for delivering packages worldwide5 It concentrated on delivering parcels overnight to the domestic market5 They built up a strong customer perception5 Once they started going worldwide 'and broke the ;aw of $acrifice( they lost G@5@ billion !ocus your product on a specific market, a specific theme and sacrifice the rest of the market for the sake of building a strong and healthy perception of your product *0- The Law of Attr!butes *o not copy the leader5 2ust because they are successful, it doesnt mean that you have to emulate them5 The best strategy is when you choose to tackle the opposition from the opposite view point eg- if they target young customers, you target the older customers< if they sell large cars, you sell small cars< if they focus on the worldwide market, you focus on the domestic market5 Own the opposite word & if they own the word )ID, you own the word $M/;; 'eg- I)M is big and builds mainframe computers, you are small and build minicomputers( *1- The Law of ,a"%or

$ometimes admitting a negative can be a positive move5 If you are number ? to the leader, then by admitting it, you may gain the confidence of the consumers 'eg- /vis is only 4o5 ? in rent>a>card5 )ut at /vis, we try harder( $ometimes admitting a negative attribute of the product can be a selling point 'eg- The @HA1 8" will stay ugly longer( ,ustomers tend to open their minds when they hear you start with a negative *ont dwell on the negative, but follow it closely by a positive eg- "ith a name like $muckers it has to be good

*3- The Law of S!"#ular!t$ Often the opposition only has one weakness, but you have to find that weakness and focus your marketing on it Only one tactic is going to destroy your competition & not a whole lot of weak tactics, but one strong one If your competition is marketing a particular way, market the opposite way and concentrate your marketing5 This will give you focus and help you to gain market share 'eg- If they are marketing to Men, market to "omen( *6- The Law of U".re%!'tab!l!t$ "eather forecasters cannot tell what the weather is going to be like in the next B days5 3ow can you predict the market over the next B years ,ompanies that pin their marketing strategy on one point that is based on the market developing over a period of years, may end up big losers5 ou must be focused but with the ability to be flexible in your approach5 ;ong term plans must be well thought out M/FI+TI4D plans, not financial plans5 )ase all long term plans on your brand, not on figures ou can take advantage of long term trends & but you have to be sure that the trend will really be long term and not a fad5 Treat fads differently5 Trends are difficult to work with because they are unpredictable The unexpected always happens )uild an enormous amount of flexibility in your organisation *7- The Law of Su''ess +go is the enemy of successful marketing *ont substitute your own :udgement for what the market wants "hen a brand is successful, companies become cocky and extend the line & a ma:or problem +go can be an effective driving force & but it can also be destructive ,+Os should get in touch with the customers needs and get to the grass roots of the business5 It is a ,+Os :ob, not an underlings :ob to make sure that the customers are being serviced correctly *9- The Law of 2a!lure

Too many companies try to fix things rather than drop things & reorganise instead of get out of the situation )e able to recognise failure early to cut losses & not hang onto something that is going to cause ma:or problems in the future "al Mart doesnt punish failure, but tries to learn from failure & )ut woe to the person who makes the same mistake twice )eing safe does not do the company any favours +liminate 6personal agendas7 within corporations

2+- The Law of :$.e "hen things are going well, a company doesnt need hype5 "hen a company uses hype, it is usually because they are in trouble and need to get publicity for their product 3istory is full of marketing failures that were successful in the press The greatest hype comes from those developments that promise to single> handed revolutionise the world 2*- The Law of A''elerat!o" / fad is a short term phenomenon that might be profitable but doesnt last long enough to do a company much good / trend takes effect more slowly but can be profitable over a longer period of time If you are faced with a fad, the best thing to do is to dampen it, because it draws it out over a longer period of time 4in:a Turtles were a fad, )arbie *olls is a trend 4ever totally satisfy demand5 ;ong term trends are the most profitable types of waves to ride

22- The Law of Resour'es +ven the best marketing ideas will not get off the ground without money ou need money to get into the mind of the prospect The rich often get richer because they have the resources to drive their idea into the minds of the prospects ou cant save your way to success Money makes the marketing world go around5 It would be better to plow all the profits back into marketing for the first few years of a business because marketing is the most important investment a business can make5