One of the most influential books I read when I first started marketing was entitled, The 22 Immutable Laws of Branding by the heralded Jack Trout and Al Ries. Armed with these laws that were, as noted, deemed absolute, I stepped into the world of marketing knowing all that I would ever need to know. That is, until reality pulled a trip cord that I simply had not notice with my self-assured nose so vertically positioned. Law after law seemed to crumble as I explored the reality of the business world, and I came to understand that Trout took a very narrow look at marketing, a shortsighted approach that continues this day.
In February, Trout posted an article aiming to prop up his decades old outdated theses. This time it was the “Law of Duality” that is, “In the long run, every market becomes a two-horse race.” Using this rationale, he gives the reasons for the Yahoo! bid by Microsoft.
Whether or not this is the reason Microsoft has gone after Yahoo! (and I agree that this “law” has a place in marketing strategy, but focusing on this law, particularly since it is not a law, can be troublesome for a company in the long-term—since it inevitably leads to market decline and price war after innovation is squashed—but that isn’t my point, so I will talk about this another time), Trout exhibits in this article the same unstructured approach to proving his contentions as he did in his original works.
Trout pulls from business history random case studies that prove his case, sometimes with accuracy but too often they are off-base and evidence guesswork. For example, he notes:
Early on, a new category is a ladder of many rungs. Gradually, the ladder becomes a two-rung affair.
In batteries, it’s Eveready and Duracell. In photographic film, it’s Kodak and Fuji. In mouthwash, it’s Listerine and Scope. In hamburgers, it’s McDonald’s and Burger King. In sneakers, it’s Nike and Reebok. In toothpaste, Crest and Colgate.
Eveready and Duracell? Consider a 2006 Time Magazine article on Panasonic’s bid to “Beat the Bunny.” And we are not talking the Duracell Bunny here. What happened to Energizer in his battery market? McDonald’s and Burger King? Though regional, In-and-Out holds a much stronger position than any fast food franchise in the US. Nike and Reebok? Does Adidas not exist? What about Puma’s resurgence?
And with this faulty foundation, he continues with his one strong case of Coke and Pepsi, with an add-on pronouncement that Toyota and GM are all that exist in the US automotive marketplace.
Take the domestic automobile industry. In spite of heroic measures undertaken by Lee Iacocca and others, Chrysler is in trouble. In the long run, marketing is a two-horse race. Today the main horses are General Motors and Toyota—Ford has been pushed into third place.
Taking this last argument in the present, based on his recommendation 20 years ago, he would have told Toyota to simply not worry—the domestic automobile market is a two-horse race and already well-established. Go do something else. Instead, Toyota disrupted the market (if you really want to see how to do marketing, look to Clayton Christensen, a business genius and fellow Forbes contributor that cannot be ignored). He would have been part of the chorus to which he derisively cites in his more recent piece,
Thirty years ago, one business magazine reported that “with over 50 foreign cars already on sale here, the Japanese auto industry isn’t likely to carve out a big slice of the U.S. market.” John Foster Dulles, in 1954, said “The Japanese don’t make anything the people in the U.S. would want.” Sorry guys, the Japanese are killing us.
And it was this piece that brought to my attention how out-of-touch Trout’s theories (and opinions) have come. I don’t fault him personally. The views of his time, still dusty and dated, represent a day in which business professionals acted as if they knew all they needed, and after gaining this immense wisdom, could therefore sit back and cynically and critically judge current (and in this case, prior) business decisions. Businesspeople and marketers in particular cannot continue to fall into this self-centered trap. Marketing is a beautiful discipline, the part of business that tries to profit from the variabilities of the human experience. Dynamic understanding of innovation, disruption, psychology, sociology, anthropology, economics, and so many other factors govern our behavior in this field. We are a bit too self-absorbed if we think that we have “figured it out”—and it is only in the continued drive to make sense of the ever-changing chaos that we can succeed in the foggy future.