Over the past several years I’ve read, and written, many blogs on the subject of Challenger brands.   I thought I’d condense some of what I’ve read into what, I hope, serves as a useful guide for those as fascinated as I am about Challenger brands.

A for Anita Roddick. Founder of The Body Shop and Challenger iconoclast. Anita is widely credited for shaking the conventions of the cosmetic industry by founding a company based on addressing environmental and ethical business issues. Today Transparency and Social Cause marketing are watch-words for business. As early as 1976, Anita saw the untapped potential to make those issues a pillar of her brand identity. True Challenger Lighthouse thinking.

Challenger brand icon Red BullB for Baumgartner. 2012 and an energy drink brand sponsors a man to throw himself from space and parachute back to earth. Only a storied challenger brand like Red Bull would’ve had the balls to do that. With a staggering 35 million views on YouTube, Red Bull Stratos redefined the term content marketing and highlighted there is no ceiling on Red Bull’s Challenger thinking.

C for Chobani. 2005. A shuttered Kraft plant. 5 employees and a family yogurt recipe. Hollywood couldn’t write the Chobani story. While the category incumbents had walked away from Greek yogurt as a “no-win” sector, founder Hamdi Ulukaya’s Challenger thinking lead to explosive growth in a category now valued at $1.5 billion where Chobani owns 17% share, more than double its next competitor.

D for Dyson. An eccentric engineer whose obsession (see I for Idea-Centric) revolutionized the household appliances sector. James Dyson was so obsessed with creating the perfect vacuum design that he experimented with over 5,000 designs before launching the perfect model. That same obsession has lead Dyson to tackle other inefficient designs – and category incumbents – in hand dryers, fans and washing machines. Challenging conventional wisdom – vacuums need a bag and four wheels, dryers need a blade – is what makes Dyson a true Challenger brand.

E for entrepreneurial. Hardly a shock, but many Challengers are founded by serial entrepreneurs. Folks who are keen to forge new paths and eschew the traditional ways of doing business. Branson has famously launched over 300 Virgin Challenger Brand iconic CEO Richard Bransoncompanies in his tenure. By acting like entrepreneurs, rather than incumbents, Challengers are able to question conventional wisdom and challenge conventions.

F for folklore. Every Challenger brand has an element of folklore built into its DNA. Some of those are about Challenger brand CEO’s (Branson is dyslexic, Ulukaya and Armancio Ortega are recluses) or about how Challenger brands act (Harley Owners Group rides, Saturn “Homecoming” picnics, Ben & Jerry’s highly-successful efforts at crowdsourcing names)…folklore magnifies the impact the brand has and is a core tenet of Challenger brands.

G for Goliath. In every category there is a metaphorical Goliath. A large, brash, arrogant, entitled brand that is the sworn enemy of the true Challenger. Like the biblical David, Challengers are the champions of the people, using their natural agility to defeat the lumbering category behemoths.

H for Hsieh. Tony Hsieh, CEO of internet phenomenon Zappos, is another Challenger icon. Where many had shrugged off the potential of selling shoes on-line Hsieh saw opportunity. In addition to transforming Zappos into a company acquired by Amazon for $1.2 billion, Hsieh created a service culture that is the envy of many. Where other online business’ have slashed customer service to drive profit, Zappos were the 1st to over-invest in customer care which has driven loyalty and referrals. Challenging category norms is why Tony Hsieh is on this list.

I for Idea Centric. Challengers are born from a fixation on an idea versus merely being consumer-centric. Ideas that zara-logodrive from “What If” versus “Consumers have told us”. A mythical 3rd place between work and home (Starbucks), a car you can rent by the hour (Zipcars), mass-produced high-fashion available almost overnight (Zara). It is the Idea that sustains Challenger companies and it is the Idea that creates legions of fans.

J for Judicious Challengers often spring from humble beginnings where cash-flow is monitored obsessively. Challengers must obey’s Michael Porter’s first rule of Strategy  “The essence of Strategy is choosing what not to do”. This obsessive fixation on an Idea (see I for Idea-Centric) versus bending to the will of the market means Challengers must always be incredibly judicious in the choices they make.

K for K-Swiss. While Nike, adidas, Converse may be more recognized athletic shoes, K-Swiss has always enjoyed celebrity Challenger status for its irreverent stance and positioning. The first to allow customers to completely customize their shoes, K-Swiss understood personalization before it became mainstream. If you want a flavor for the K-Swiss attitude, check out the hilarious spokesperson Kenny Powers the  MFCEO of K-Swiss

L for Lazy. Lazy categories where complacency or fear is rife are classic Challenger opportunities.Perhaps my favourite Challenger quote comes from Sir Richard Branson who said; “I love tackling lazy industries”. From the man who has challenged the music, financial, airline, rail, bridal and space industries, this quote rings incredibly true.

M for Middle-of-the-road. Challenger thinking broaches no middle-of-the-road positioning. The middle of the road is where brands and businesses get killed.

N for Nandos. Quirky South African brand Nandos has redefined the QSR category causing global players like KFC to sit up and take note.  With a history of humorous and politically-charged advertising, Nandos highlights that Challengers are unafraid to take on any incumbent – even if that incumbent is the ruling ANC Party and their sponsorship of Zimbabwean dictator Robert Mugabe.

O for Opportunistic (and Overcommit). The story of Virgin Atlantic serves as a great example of this classic Challenger attitude. The idea formed when Branson was stranded by a cancelled flight in Puerto Rico. Branson essentially began operations with a single leased jet that blew up days before the scheduled launch of the airline. Undeterred Branson pulled money from other Virgin companies and VA went ahead. Years later he was forced to sell Virgin Music to continuing funding an idea that he still passionately believed in. This type of Overcommitment is another hallmark of great Challenger brands.

P for Passion. Not surprisingly passion is a core component of Challenger brands. Often manifest in founders like Branson, Dyson, Hsieh, Dietrich Mateschitz (Red Bull) but, more importantly, Challengers evoke similar passion in their employees and in their fans. Challengers are renowned for delivering service excellence at all touchpoints – think Zappos, Virgin Atlantic, Jet Blue. That doesn’t happen without commitment and passion.

Q for Quirky.com. If innovation and crowdsourcing are the Challenger business priorities of the future, then Challenger brand Quirky.com is leading that charge. The website essentially democratizes the entire innovation cycle by providing a site where innovation and real consumers can interact. Not only can you view inventions but also help improve their design and help determine a market price too. Quirky is bringing Challenger thinking to the classically closed arena of New Product Development.

R for Red Bull. From inception to launching folks from space (see B for Baumgartner) Red Bull is a Challenger brand personified. While other energy drinks took the road of athletic sponsorships, Red Bull became the must-have trendy drink at rave clubs. When others were sponsorsing mainstream sports, Red Bull has been sponsoring Air Races, downhill ice derbies, free running spectaculars and others. Where extreme mental agility meets physical endurance, Challenger Red Bull can be found.

Challenger brand cable company AMC S for Sacrifice. True Challengers realize that, by Overcommiting they are going to alienate some consumers and some markets. Challengers are not, like most brands, trying to be everything to everyone. Southwest Airlines are not for folks who want lavish attention. US cable company AMC has avoided category clichés like RomComs and Celebrity gossip programming, preferring instead to champion some of the most breakthrough (and award garnering) TV programming in recent years with shows like Breaking Bad, Mad Men and The Walking Dead. Both have sacrificed easier routes to market but, by sacrificing, they’ve both gotten higher loyalty and fandom than their category peers.

T for Thought-Leadership. Challengers tackle the tough issues within categories. The sacred cows others aren’t comfortable addressing. Not surprising they become the thought leaders in a category. The trailblazers determining where next. Ecological values in cosmetics (The Body Shop), the conversation around periods (ubyKotex), customer service not cost-cutting in the airline industry (Virgin Atlantic). Challenging the conventions and leading the conversations is what Challengers do best.

U for U/X or ubyKotex. Okay, I took a little license here but the ubyKotex campaign by San Francisco agency Organic has turned the tired and out-of-touch feminine hygiene category on its head. No more blue liquid demonstrations, no more girls in white jeans, ubyKotex has been lauded as the first women’s brand to actually talk intelligently to women. An incredible example of Challenger brand thinking that resonates.

V for Volatility (and Virgin). Business today is more volatile and fragile than ever. Brands that continue to operate in traditional models – HMV, Blockbuster, Woolworths, Borders – are being obliterated with ruthless efficiency. Often by true Challengers – Amazon, Netflix, Spotify. There has never been more impetus to consider Challenger thinking in your business.

W for Waitt. Ted Waitt was one of the founders of iconic Challenger tech firm Gateway. In a market serviced by Dell, H-PChallenger Brand original Gateway and IBM, Gateway famously shipped their computers in spotted boxes designed to look like cows, a head-nod to the company being started in an actual farm in Iowa. Unfortunately Gateway, like many tech firms, was unable to survive the dot-com bust and was acquired by Acer in 2007. For his instinctive understanding of Challenger credo #7 “Use Advertising & PR as a high-leverage asset”, Ted Waitt and Gateway make this list.

X for X-Factor. Why is it that some Challenger brands are ever-lasting and some fizzle and die? Personally, I think those that attain Challenger status and then fade away are missing a vital X-factor. That X-factor is continued commitment to acting like a Challenger. Avis, Pepsi, and I would even add Apple to that list, have all shied away from the Challenger commitment that took them to the top. In doing so, they’ve lost a step.

Y for Y (okay…Why). Cut me some slack here guys. You know how few words and brands start with a Y? Anyway, this is a mantra near and dear to my heart. Challengers look at business through a lens of “Why Not” instead of “Why Would We”. That has a profound effect because it means the seemingly impossible suddenly becomes feasible. No frills airlines (Southwest) Expensive, under-performing motorbikes (Harley-Davidson), Weird tasting beverages (Red Bull). At their heart, questioning conventional thinking is where Challengers shine.

Challenger Brand ZipcarZ for Zara, Zipcar, Zappos. Three iconic business models that have redefined their categories. Zara’s founder is nowthe 3rd richest man in the world. By challenging traditional fashion category practices, he stripped weeks from the “catwalk to the store” cycle creating the “fast fashion” movement. Zipcars success was so profound that Avis recently paid $500 million for the feisty Challenger, hoping to reinvigorate their business. The irony of Avis, a Challenger in its own right, acquiring Zipcars was lost on no-one. Zappos has also seen incredible success. A success that Amazon founder Jeff Bezos was keen to capitalize on. Read this incredible letter by Tony Hsieh on the acquisition to see how fundamental Challenger thinking remains at the company.

I’m sure I’ve left out some favourites, mis-appropriated terms to fit them into my tidy alphabet, missed some key terms.

Weigh in readers. What’s missing from the list above?

I wanted to thank the awesome folks at eatbigfish for their help on this post. The ever stellar Chad Dick was fantastic. If you love Challenger brands, then find more great thinking here or follow them on twitter at @eatbigfishLDN

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