How do you break a duopoly? Pure duopolies can be incredibly strong and hard to break, even near duopolies can be the same. Think of Pepsi and Coke, Apple phones and Samsung are another example with 15% and 20% share respectively1 . Why is it some markets seem to lend themselves to duopoly and others don’t? The car market, by contrast, varies hugely by country and shares vary on a nation by nation basis. At another level you could argue fast moving consumer goods have a ‘hidden’ duopoly of Unilever and P&G. Whatever the reason, this case study makes us think about how we can ‘break in’ to seemingly impossible static markets. It explains how John Truswell and Sean Kerns went about starting to break a duopoly in rowing boats.
This story showcases the early days of a success story, it’s a brand most of you won’t have heard of called Nelo2, they are based in Portugal. Nelo make boats, surf skis, kayaks and rowing boats. In the UK there are two strong incumbents in the rowing boat sector – Empacher and Filippi. Between them they own the majority of the international and high level competitive rowing market. The brands are quite tribal, with both claiming their brand is superior. Nelo’s kayaks enjoyed considerable success over the last 15 years or so, they got 4 Olympic medals in Sydney and 27 of the available 36 in Rio in 2016. But in the UK they could not break into the rowing market. It all started when John and Sean heard about the success of a Portuguese Nelo boat winning a key event called The Scullers Head in 2016, sculled by a lightweight (70kg) who are normally slower than heavyweight scullers at top level . They seized the initiative, went to Portugal and become the UK distributors at the start of 2017. The boats have a product advantage, they have a shorter hull, a lower ‘plumb line’ and a flatter profile under the bow section, which means the boats stabilise at a standard level in the water, once at race pace, giving more speed and distance per stroke. Now rationally you’d think that would be enough to persuade anyone who rows, speed is what it’s about, but that’s not the case. You could easily argue Apple computers are more user friendly than Windows brands but that doesn’t mean Apple owns half the market. The same is true of Pepsi, which in blind taste tests outscores Coke. Social proof is often proof enough even if it’s illogical.
So Nelo UK realised they had to get people to trial Nelo – but even that wasn’t easy. Coaches were fiercely against new brands. On the upside rowing is a natural ecosystem, rowers turn up at events, you’ve got a captive market which is unusual. In addition, Nelo boats could be customised and some had a Union Jack on the front or a different graphic design, meaning they stand out. So Nelo UK wanted to prove speed at a key event, the 5km National Junior trials race in Boston Lincolnshire, a rower who would have been expected to finish around 20th , based on previous results and the fact the athlete was a “sweep” rowing specialist with one oar, not a full time sculler , (two oars) finished 4th from over 100 entrants in a Nelo boat. That started to get tongues wagging, as with all things Word of Mouth, you have to give people a reason to talk. Flowing from this Nelo boats will be going to the GB Junior Training Camp in Spain this year, many of the participants will go onto to represent the UK at an International level. So it sounds easy but stop and think about this for a moment. That has also been followed by one of the GB Olympic rowing finalists from Rio, approaching Nelo to help develop the 105kg crew weight version, as a boat for GB trials, and also international events. The trials have been successful and the new hull will be available in the next few weeks
Most companies approach product trials in a scatter gun way, the objective is to get as many people as possible trialling your product in the hope of making some sales. Think of food companies who give product away in supermarkets or software companies who give away free software in the hope some people will buy a better version, zoom is a classic version of this. In fact, in most companies, the marketing managers don’t want a targeted, focussed product trial approach, they want a mass approach. Even if they wanted to target advocates of their brand, many companies don’t know who they are and they don’t have a system to identify them. The bottom line is that advocates need to be targeted on behaviour – it’s tangible, they go to your website more often, they may write to you, they participate on line. But the overlooked group are Champions. Champions may not use your brand a lot but they talk a lot about you. Just think of an expensive restaurant, a family might only be able to afford to go there once a year, so the restaurant does not rate them as important, but they are telling everyone about the restaurant.
There’s a science for finding your advocates and champions and if you don’t know it, you’ll never be able to run a successful product trail campaign. And if you are in a static market with fierce competition, it’s very hard to get people to change their views, the only way is to get your ‘better product’ in their hands. If you want to learn more about the scientific approach to finding your Advocates and Champions, then come to our event or e-mail us – email@example.com And if it’s a Nelo boat you are after having read this, or want to know more about the Nelo rowing project and development drop John a line on firstname.lastname@example.org
"Different to get better results". Jake is obsessed with marketing ROI. He helps companies amplify word of mouth to get business more easily. He uses Meanomathics to boost Comms cut through 10-30%. He uses co-creation to future proof innovation - he turned around a drinks category providing 15% growth using professional co-creation. And he helps top CEO and celebrities with their personal branding and brand purpose, which links back to Word of Mouth marketing.
Worked with Vodafone,Kellogg'sMcDonalds,ANZ,McDonalds,Suntory,Danone,HSBC,Barclays,BAT,Meat Brands,Saatchi&Saatchi,Draft FCB,Fairbrother Industries, Les Mills, Holmes Place, Grey and a host of digital start-ups.
Jake Pearce is a specialist in brand planning, development & innovation. Jake is currently working on a Word of Mouth Marketing start-up, a personal branding start-up and new delivery systems for wellness products.
www.jakepearce.com - for brand development and innovation
www.womtwo.com - for word of mouth marketing expertise