Brand Cannibalization

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BRAND CANNIBALIZATION: EAT OR BE EATEN

With increasing commoditization of brands, differentiation is hard to come in every industry. Consumers are now flooded with options, single company having several brands in same product category. Positioning, targeting, segmenting can serve as strategies no more. Rather it is the basic hygiene which any company needs to follow if it needs to sustain in the race for market share.

So, what should a marketer adopt as a strategy? There are unconventional approaches followed by Multinationals to address the goal of increasing their market share. With consumer demand for innovation increasing, brand loyalty being a privilege of few companies and E-commerce providing an instant comparison amongst
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While there are two school of thoughts that argue about the same, I choose to adhere to diplomacy. As it is true for every strategy, in implementation of it lies the crux. There are examples of brands which faltered in the implementation and ended up cannibalizing for no gain or for a loss of revenue and then there are these who have learnt to effectively deploy it as a successful tool. If carefully planned, we even may talk about new opportunities that can lead to increased sales and market share (Proactive Cannibalization). And if a company does not have a strategic plan for digital transformation someone else will (Passive Cannibalization).

To exemplify my stand on why the only answer is Effective cannibalization we have a look at some previous decisions. Taking the example of The New York Times, which saw newspaper sales plunge when they began posting free online versions of their stories on the internet, it would not be wrong in calling it as inefficient Cannibalization. But in this case, every other newspaper faced the same situation since if they did not provide such services, the market share of New York Times would increase, which was then undesirable. So they rushed and joined the league since “Cannibalism hurts if you eat your own toes, but it’s better than starving”.

On the contrary, a brand that uses their existing brand reputation to leverage a successful cannibalization campaign is Gillette,

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