Use Parasitic Positioning versus Superbrands - Brief Article

Dot-coms are coming to agencies desperate for any concept that will build word of mouth and click-throughs. Nothing is sacred. Neither gerbils shot out of cannons (Outpost.com) nor youngsters mouthing boot-licking career aspirations (Monster.com). Not even RuPaul as a celebrity spokesperson (WebEx).

If our first inclination is a new level of outrageousness, delivered with a hearty media budget, the performance of living.com, gifts.com or Dsports.com should give us pause. Each delivered over 500 million ad impressions this past Christmas but failed to register even 250,000 Web visits. Compare this performance to Hallmark, who spent nothing to advertise its site but registered 1.9 million visits.

So how does an emerging brand--whether e-commerce or otherwise--hope to carve out a niche when outrageousness becomes the norm, and spending in the e-commerce category alone ballooned from $350 million in 1998 to $3 billion in 1999?

One answer lies in "parasitic positioning." An emerging brand lifts itself out of the clutter by latching onto an established brand, feeding off a familiar position in an established category--metaphorically riding a whale so it can wave to the throngs on the beach.

From the consumers perspective, parasitic positioning makes even more sense. Think of it as a pirate brand extension. Anchoring an unknown alongside a Nike, Coke, Southwestern Bell or Pizza Hut provides a distracted consumer with an informational assist.

Consider the story of Birch Telecom versus Southwestern Bell. The small phone company founded by a handful of expatriates from Sprint, came to us in 1998 as it was about to go toe-to-toe with Southwestern Bell, an entrenched, $43 billion behemoth employing 203,000. Birch, with six desperate souls and dwindling reserves, believed it could convince investors and prospective customers that an untested startup offered a viable alternative to what Forbes rates as "one of the most admired phone companies in the world."

Birch latched onto Southwestern Bell like a lamprey onto a Walleye with the parasitic positioning claims: "100% of our customers fired Southwestern Bell" and "Think of us as a frisky, friendly alternative to Southwestern Bell." These campaign themes defined Birch strictly in terms of the incumbent. Radio, print and outdoor ads kept Southwestern Bell in front of every prospective Birch customer. According to a tracking study in four Texas markets, this parasitic approach vaulted Birch over established competitors after only eight weeks of exposure.

Or take the Papa John's pizza franchisee who took on Pizza Hut in public taste tests. The franchisee, one of Pizza Hut's founders, attached his emerging brand to the country's leader, cleverly placing the startup squarely in the path of Pizza Hut customers, defining not only the benefits, but challenging tastes and preferences. Was it successful? "When you get the category leader to come out and fight you, it's a surefire way to get media coverage," says branding expert Al Reis, co-author of Marketing Warfare.

Admittedly parasitic position is difficult for most agencies to propose, and marketers to consider, for it obligates an emerging brand to showcase a category leader. Devoting time and attention to any competitor, in this case a dominant one, carries risks. It exposes the brand to the scrutiny of a devoted audience. It risks waking a sleeping giant. Most troubling for agencies, parasitic positioning is not inherently sexy (imagine Dsports claiming to be the Wal-Mart of sporting goods). But it is a logical convenience consumers need in an era of information overload.

Starting from scratch against a brand with icon status, such as Pizza Hut or Southwestern Bell, may seem hopeless. But with parasitic positioning, emerging brand marketers can efficiently convert competitive brand equity into an advantage. When an emerging business can't approach the spending and awareness levels of an entrenched market leader, it only makes sense for the underdog to use the leader as a reference point. It's an increasingly viable option at a time that industries continue to consolidate and the disparity is growing between startups and the colossal Superbrands featured in this week's issue of Brandweek.

Phil Smith is owner and creative director of Prairie Dog, Kansas City Mo., an agency focusing on healthcare, telecom and finance. He can be contacted via e-mail at psmith@pdog.com.

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