Originally published February 9, 2016, in Buzz on Biz
By Mark Alison
What’s up with the Yeti cup?
Who would have imagined that the double-walled insulated cup business was ripe for another cup? Especially one that costs $39!
Did you try to buy a Yeti cup over the holidays? Cabela’s, Academy, Bass Pro and Gander Mountain were all sold out, nationwide. Amazon had ‘em at double their retail price ($80) 20 days before Christmas. What’s up with that?
Yeti is not a new name in an industry dominated by Coleman for years. Insulated cups are not new and typically cost less than five bucks. The Yeti cup is simply a new take on an old design but, more importantly, it does what other cups don’t; it actually works… better. And that explodes an old marketing myth I have questioned for years.
Al Ries and Jack Trout’s amazing little paperback book, The 22 Immutable Laws of Marketing, is required reading for marketers. The very first law in the book is “The Law of Leadership” with the subhead “It’s Better to be First than to be Better.”
They support their first law by referencing that few people know the name of the second person to fly solo across the Atlantic but everyone knows the name of the first guy, Charles Lindbergh (the second guy was Australian Bert Hinkler).
I’m not buying it. I would argue that being first is highly overrated.
In a competitive category, I think being first is not essential and being second is not the kiss-of-death. Reis and Trout would point out that no one remembers the names of previous Olympic silver medalists or the names of past U.S. vice-presidents. OK, point made, but this isn’t Jeopardy!, it’s marketing.
I believe some enterprises win big by not being first. I think they profit greatly by being what I term, “A Smart Second.” Here’s why.
In some sectors, engineering and R&D costs can be the most expensive part of the venture, even surpassing marketing expense. Being a Smart Second means allowing the first guy to pay for the innovation.
I’m not talking about knocking off the competition. I suggest improving on the product, making it better and offering it at a competitive price. That is what being a Smart Second is about and that’s what the Ninja Coffee Bar Coffee Maker did for 2015.
While Keurig and its second-place competitors have done an excellent job redefining the coffee experience with single-serve K-cups, their decision to create a larger-serve carafe version has not been as successful. They should have stayed with single serve instead of trying to extend the brand – but brand extension is another story.
The Ninja product doesn’t attempt to duplicate the Keurig experience. They capitalize on the consumer’s desire to experience “Starbucks” on their home countertop, an idea that Keurig created with the single-serve K-cup. But, Ninja goes one better by making a product with a variety of specialty brews built in, including single cup, carafe and – here’s the “smart second” – the added savings of using beans instead of K-cups to do all of the above.
It’s an old idea with a better outcome. As a coffee lover, I am impressed. Smart Second takes the prize.
One more example for anyone born in the 20th century. It’s is an old story but it bears repeating. The No. 2 car rental company, Avis, competed heads up with No. 1 Hertz from 1963-66 during the period called “Advertising Wars.” The campaign, created by Doyle Dane Bernbach, actually took smart advantage of Avis’ second-place position with the tag line, “When You’re No. 2, You Try Harder.”
It worked. Within a year Avis went from losing money to making money, the first time it had been profitable in more than a decade. Today, Avis is in 165 countries. A Smart Second wins yet again!
Singer Chris Daughtry placed fourth in season five of American Idol, took his show on the road with a band and is one of the top-selling brands to come from that program. Similarly, Kathrine McPhee has sung with Andrea Bocelli and recast herself as an actor on network TV. That’s not too shabby for a non-first place winner.
The undeniable truth Reis and Trout point out is there’s only one first place. Everyone else comes after that. The idea is to be a recognized contender. That means a Smart Second – or third or even fourth in some businesses.
You need to be in the game when decision time comes so you get your chance at bat. Then, allow your “better” product or service to help you win. It might require you and your team to try harder but Avis has already proven it can be done.
Meanwhile I’ll toast your “Smart Second” win with my $39 Yeti cup that I bought after Christmas.
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