#1 or Gone: Why You Must Become A Market Leader

Here are the three questions you must answer to determine your route to becoming the market leader in your industry. Read of to find out more....

Which airline is the #1 player?

If you ask this question in the USA, you’ll probably find that Southwest Airlines is the leader, while in Europe it’s Ryanair. If you look at long-haul flights then Singapore Airlines is often passengers’ first choice, particularly if they’re flying first class. Alternatively, Turkish Airlines has flights to the most countries, but American Airlines is the biggest and most profitable airline business of all.

All of these airlines can claim to be #1, even though they serve different markets, offer different propositions and have created different sets of competitive advantages.

FlyBe, on the other hand, has no claim to be #1. It’s a nice enough airline but is unable to beat Ryanair at the low-fare end of the market. It is unable to complete with the full-fare airlines on the provision of a high-service experience on European flights. Unsurprisingly, FlyBe is losing cash and has recently posted a £20 million loss.

It’s the same in other industries. Unless you are #1 in your market, it’s likely that you will struggle to generate the revenues and profits necessary for you to thrive. Like FlyBe, you will simply be locked into a cycle of anaemic profits, periodic losses and the constant threat of failure.

The good news is that you don’t necessarily need to be the biggest player in the market to be a leader that can thrive. As with the airline industry, there are different ways to achieve that status.

Here are the three questions you must answer to determine your route to market leadership:

  1. What is your playing field?

    Every company operates on a different playing field. Your playing field comprises four elements:  the products and services you offer, your target customers, your geographical reach and the channels you are using to reach your customers. What is the playing field that you wish to create? Ryanair’s playing field is to provide short-haul flights to Europe’s budget-focused travellers. While Singapore Airlines is more focused on business and high-income global flyers.

  2. How will you win?

    You must then choose how you will win in that market. Are you going to be the lowest price operator, like Ryanair or the service leader, like Singapore Airlines? Alternatively, you may wish to be the convenience leader (e.g. Amazon, McDonalds), the product leader (Apple, BMW) or the solutions leader (IBM, McKinsey) of your particular market.

  3. Will your strategy deliver sustainable returns?

    A desire to be Nottinghamshire’s #1 airline may enable you to become a #1 player in that market. But if the market isn’t attractive enough – and, as far as I know, the passenger demand for flights from Worksop to Mansfield is not that high! – it’s unlikely that you’ll be able to deliver the returns needed for sustainable success. Similarly, an ambition to be China’s #1 airline may seem attractive. But if you haven’t got the assets, relationships or know-how to compete effectively in that market, it’s unlikely that you will be able to turn your ambition into reality.

 

Without a commitment and strategy to becoming and remaining a true market leader, you will struggle to survive. Let alone thrive! But, by identifying a sustainable way to lead your own particular playing field you can justifiably claim to be #1.

 

How will you become your market’s #1?

 

© Stuart Cross 2017. All rights reserved.

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One Response to #1 or Gone: Why You Must Become A Market Leader

  1. Pingback: 25 Ways to Lead Your Market | Cross Wires Blog

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