Brand Competition

Definition

The closeness of competition between brands within a market is indicated by which other brands a brand shares it customers with, over repeated purchases

Key Findings

Competition means running hard to stand still. With intense competition, the outcome of marketing activity is therefore usually a more or less competitive equilibrium rather than gains for any or all. Hence a successful outcome is maintenance of one’s sales and the reinforcement of one’s loyal customers.
Brands compete practically head-on with every other brand in the market.
Brands compete as if they are practically identical alternatives; differing in popularity.
A brand shares customers with rival brands in line with their size. In any time period, a brand shares much of its customer base with the bigger rival brands, and a little with the smaller brands.
Partitions exist, where brands share a bit more than expected, but these are rare and usually based on functional differences e.g. sweetened (i.e. kids’) cereals; diet soft drinks etc.

Reports (18)

Reports

Showing 18 results

企业赞助商报告 – 第26篇 (2002年⼀⽉份) 双重危机定律的回顾

January 2002

相对于大品牌，小品牌的购买者较少，并且购买频率较低。

This report is a Chinese translation of Report 26: Double Jeopardy Revisited Again.

REPORT FOR THE B2B INSTITUTE
MAY 2021

This report looks at how customers buy across brands in B2B categories, and what this means for company growth. It shows how competition in B2B categories is largely defined by competitor share, which is known as the Duplication of Purchase (DoP) Law.

REPORT 100
FEBRUARY 2021

To grow, brands have to attract new buyers, yet consumers keep returning to brands already in their repertoires (loyalty). This exploratory report investigates how often new brand buying occurs and what disrupts habitual repeat brand buying behaviour.

Report 95
August 2019

Are the users of a brand in one category more likely to purchase the same brand in other categories (i.e. brand extensions) ?

We analysed one year of household purchasing data for thousands of households to understand the level of cross-category purchasing brand extensions achieve. We investigate 99 extensions across 30 consumer packaged goods category pairings.

This report finds that users of a brand are more likely to purchase extensions than are non-users, showing that the branding facilitates the purchase of a product in a second category. However, this effect is not universal.

REPORT 90
July 2018

This report re-examines the common assertion that the vast majority of new products fail. We investigate whether claims of very high new product failure rates are true or not. We review past empirical research from peer-reviewed academic journals published over the past 26 years and provide a detailed analysis of failure rates for over 30,000 new product launches, from around 10,000 brands, across 25 consumer packaged goods categories (ranging from soft drinks to bath tissue) in the United States market. The findings show that new products do fail, but failure is not as high as is widely believed, or at very least not as fast as thought.

REPORT 89
June 2018

This report shows the Law of Double Jeopardy for brand loyalty holds for different service categories, such as banking, insurance and hotels, for different loyalty metrics and across different countries.

Report 88
June 2018

Customer choice behaviour modelling over the last five decades provides a deep foundation of knowledge about how markets operate, particularly in a fast moving consumer goods (FMCG) context. Such modelling led to generalisable patterns of consumer behaviour that have been shown to hold across many periods, countries and FMCG categories. These are now widely known as three empirical laws: Double Jeopardy, Pareto Share and Duplication of Purchase. However, whether these laws apply to an industrial market context is less well documented. We now extend our analysis to an industrial, capital goods context. We analyse the buying patterns of 51 of the world’s largest commercial airlines from June 2005 to June 2015. The data includes over 9,000 purchase records representing about 80% of all large commercial aircraft sold during that time.

Report 81
APRIL 2018

The Institute's previous studies in non-luxury categories show striking similarity in the profiles of competing brands’ customer bases. But does this apply to luxury brands? Luxury brands are thought to be more differentiated, on qualities such as brand heritage, or craftsmanship that are difficult to replicate. Does this then mean luxury brands are different? That Moet’s Dom Pérignon attracts a very different customer base from Taittinger’s Comtes des Tastes; and that Longines watch owners are very different to TAG Heuer owners? To answer this question we compare the brand owner profiles of more than 200 luxury brands.

Report 75
October 2017

Categories such as transport, accommodation and music have undergone considerable change with the introduction of so-called disruptor brands. Brands such as Airbnb, Netflix, Uber, Spotify, Apple music, have entered markets with new business models to shake up the status quo. In this report we investigate if the introduction of disruptor brands has disrupted the law-like patterns of brand growth.

REPORT 72
March 2017

Sub-brands show high rates of substitution by buyers. But they do still add to the penetration of the brand as a whole – on average, the combined actual penetration of sub-brands is 83% of their summed penetrations. For example if sub-brand A has 5% annual penetration and B has 5%, their combined annual penetration will not be 10%, but will be around 8.3%.