Drive long enough and you’ll have that heart-wrenching moment when an errant squirrel suddenly and unexpectedly darts out into the middle of the road.

And stops.

Unless you’ve the reflexes of a fighter pilot, the next part of the story unfolds in sad, graphic detail.

Slowly. Agonizingly. Inevitably.

Roads, we’re told from childhood, aren’t safe places to play. Markets, we learn as adults, aren’t safe places to play either.

And the worse place to be – be it a road or a market – is slap-bang in-the-middle.

Historically, business’ could delude themselves into straddling the middle of their market. Offering just enough breadth of inventory or points of distribution that they could avoid the commitment required to become a big-box retailer (say like WalMart, Tesco, Loblaws) or a highly-specialized niche offering.

No more.

HMV is the most recent fatality

The UK press is awash in news of HMV’s receivership after 92 years in business. Music lovers are tearful at the loss of another music icon. Town planners are lamenting the end of England’s fabled “High Street”. A lively debate has been going on at this blog about all the reasons why.

Of course the Internet and the music-downloading phenomenon are cited as key reasons. Just like Blockbuster’s bankruptcy was put down to the superior online streaming services offered by NetFlix.

That’s a fair analysis. The Internet has created a powerful alternative to the business model in which HMV and Blockbuster operated under.  It was just easier (and often cheaper) to sample, browse and buy online than schlep into a store.

But that’s not the complete story.

Its not just the Internet

If it was, what about other casualties in the retail wars? In the UK brands like Jessops, Woolworths, Comet have gone to the wall. In Canada, Hudsons Bay Company and Sears have had a long bumpy road. The Internet isn’t solely responsible surely?

Perhaps the answer is infinitely simpler? By playing in the middle of the road, they were all destined to become roadkill.

Not large enough to compete with WalMart, Costco on scale and volume or to negotiate hard enough to drive low prices. Not niche enough to charge higher margins by virtue of superior service, deep expertise or product knowledge like a specialty boutique.  Like that errant squirrel, caught frozen in the middle…with receivership barreling down upon them.

Challenger brands and Retail

For me personally, that’s why Challenger brand thinking is so powerful and so needed in today’s retail environment. It abhors middle-of-the-road positioning and forces brands – regardless of their size – to take a stance and make a commitment to that positioning. Retail Challenger brands – like Zara and The Body Shop – have sustained global growth because they’ve remained laser-focused on a differentiated story. Zara’s incredible “fast fashion” ethos brings bleeding-edge trendy clothes from concept to store in 10 days, The Body Shop has been unwavering in its ecological mandate years before the rest of the industry took notice. Like true Challenger’s they defined a succinct story and rallied the entire organization behind it.

For HMV the dye was cast when they moved from the location for die-hard music lovers to mass appeal. Decisions requiring employees to hide their tattoos stripped HMV of their most passionate music-loving staff. Catering to the masses meant inventory that could be bought cheaper on-line or at larger retailers. No win.

The lesson?

Straddling the fence is not a position

It’s actually the complete absence of a position. Straddling is not a strategy of playing it safe in a market rife with risk and uncertainty. It’s actually riskier and inherently dangerous. Sure, your demise may not be overnight but, like HMV’s 10 year slide into receivership, its inevitable.

Have any brands flourished by servicing the middle? Can Challenger brand thinking give retail brands a new lease of life?

What say you brand and retail experts?

<While we’re clinically passing judgment on HMV, take a moment to consider the 4,000 staff directly impacted by this. These decisions to “play it safe” do have a very real human consequence>

Tags: Adam Morgan, Challenger Brands, Consumerism, reputation, Strategy