The 22 Immutable Laws of Marketing: Violate Them at Your Own Risk

Marketing consultants Al Ries and Jack Trout, drawing on more than 25 years of studying what works and what fails in the marketplace, argue that marketing is governed by fixed, universal principles. Violating these principles leads to failure regardless of budget, talent, or execution. They point to corporate giants like IBM, General Motors, and Sears, Roebuck, all of which struggled not because of poor execution but because their programs rested on flawed assumptions. The authors compare marketing laws to the laws of physics: Just as an airplane will not fly if it ignores gravity, a marketing program will not succeed if it ignores these 22 laws. Ries and Trout had previously developed frameworks they call "positioning," a model of how ideas occupy space in the human mind, and "marketing warfare," a military model of marketplace competition. This book distills those years of work into a concise set of rules.

The first law, the Law of Leadership, states that it is better to be first than to be better. The fundamental issue in marketing is not product superiority but creating a category in which you can be first, because the first brand into a prospect's mind almost always remains the leader. Charles Lindbergh is universally remembered as the first person to fly the Atlantic solo; Bert Hinkler, the second, is virtually unknown. Across industries, from Hertz in rent-a-cars to Heineken in imported beer, first movers dominate and often become generic names for their categories: Xerox for copiers, Kleenex for tissues, FedEx as a verb. The second law, the Law of the Category, offers an alternative: If you cannot be first, create a new category. After Heineken dominated imported beer, Anheuser-Busch created Michelob, the first high-priced domestic beer. After IBM dominated computers, Digital Equipment Corporation (DEC) became the first in minicomputers, a smaller class of computer.

The third law, the Law of the Mind, modifies the first: What matters is not being first in the marketplace but first in the prospect's mind. IBM was not first to market the mainframe (Remington Rand's UNIVAC was), but through aggressive marketing, IBM got into the mind first and won. Once a mind is made up, it rarely changes. Wang could not shift its position from word processors to computers, and Xerox spent $2 billion over 25 years trying to enter computing and failed. The fourth law, the Law of Perception, asserts that marketing is a battle of perceptions, not products. Honda sells the same cars in the United States and Japan, yet Honda leads in the U.S. (perceived as a car company) and trails in Japan (perceived as a motorcycle maker). Coca-Cola's 200,000 taste tests proved New Coke tasted better, yet the original formula outsells it.

The fifth law, the Law of Focus, holds that the most powerful concept in marketing is owning a single word in the prospect's mind. Federal Express owns "overnight," Volvo owns "safety," BMW owns "driving." The sixth law, the Law of Exclusivity, warns that two companies cannot own the same word; attempting to take a competitor's word often reinforces the competitor's position, as when Eveready's Energizer bunny campaign failed to take "long-lasting" from Duracell. The seventh law, the Law of the Ladder, argues that strategy must match the rung a brand occupies on the prospect's mental product ladder. Avis lost money for 13 years claiming to be the finest in rent-a-cars; when Avis acknowledged being No. 2 ("We try harder"), the company became profitable.

The eighth law, the Law of Duality, predicts that over time every market becomes a two-horse race. Between 1969 and 1991, Coca-Cola and Pepsi tightened their grip while Royal Crown nearly vanished. Third-place brands face serious long-term trouble. The ninth law, the Law of the Opposite, advises No. 2 brands to present the opposite of the leader's strength rather than imitate. Pepsi became the choice of a new generation in contrast to Coca-Cola's established heritage. The tenth law, the Law of Division, holds that categories divide over time: Computers split into mainframes, minicomputers, workstations, and personal computers, each with its own leader. Volkswagen's Beetle captured 67 percent of the U.S. imported-car market, but when VW replaced the Beetle with bigger, pricier models under the Volkswagen brand name, its share shrank to less than four percent. Honda, by contrast, created a separate Acura brand for the luxury segment and succeeded.

The eleventh law, the Law of Perspective, warns that long-term effects often oppose short-term results. Sales and coupons boost revenue briefly but train consumers to avoid regular prices. Miller High Life nearly tripled sales after Miller Lite's 1974 introduction, then declined for 13 straight years. The twelfth law, the Law of Line Extension, is what the authors call the most violated law. A focused company spreads across many products and starts losing money. IBM expanded from mainframes into personal computers, workstations, software, and more, losing $2.8 billion in 1991. After adding multiple variants, 7-Up's market share dropped from 5.7 to 2.5 percent, while focused Gerber holds 72 percent of the baby food market.

The thirteenth law, the Law of Sacrifice, is the opposite of line extension: Companies must give up product line breadth, broad target markets, and constant change. Federal Express concentrated solely on small packages overnight and grew far larger than Emery Air Freight, which offered every service. Philip Morris targeted the cowboy figure exclusively and made Marlboro the world's best-selling cigarette among both men and women, illustrating the principle that the target is not the market. The fourteenth law, the Law of Attributes, states that for every attribute a leader owns, there is an effective opposite. When IBM dominated with "big and powerful," DEC seized "small" and launched the minicomputer.

The fifteenth law, the Law of Candor, argues that admitting a negative disarms prospects and opens the door to a positive. Listerine embraced its bad taste with "The taste you hate twice a day," implying it must kill germs. The sixteenth law, the Law of Singularity, holds that only one bold move in a given situation will produce substantial results. Japanese and German automakers flanked General Motors at the low and high ends rather than attacking its strong middle. The seventeenth law, the Law of Unpredictability, warns that marketing plans built on assumptions about the future are usually wrong. Companies should track trends and build organizational flexibility rather than rely on forecasts.

The eighteenth law, the Law of Success, warns that success breeds arrogance and arrogance breeds failure. Companies assume their brand name caused success and plaster it on other products. Kenneth Olsen, founder of DEC, dismissed personal computers, open systems, and reduced instruction set computing (RISC), a processor design approach, missing three major developments and losing his position. The nineteenth law, the Law of Failure, advises recognizing failure early and cutting losses. Wal-Mart founder Sam Walton's "ready, fire, aim" approach rewarded experimentation and penalized only repeated mistakes. 3M's "champion" system offers another solution, as illustrated by 3M employee Art Fry, who championed Post-it Notes over nearly a dozen years.

The twentieth law, the Law of Hype, holds that the situation is often the opposite of the way it appears in the press. New Coke received more than $1 billion in free publicity yet failed, while Toyota arrived in California to no fanfare and became a major force. The twenty-first law, the Law of Acceleration, distinguishes fads from trends. Coleco Industries flooded the market with Cabbage Patch Kids novelties, hit $776 million in sales, then filed for bankruptcy by 1988. The Barbie doll, never heavily merchandised into other areas, became a long-term trend. The twenty-second law, the Law of Resources, states that even the best idea requires money. Steve Jobs and Steve Wozniak had the idea for Apple, but investor Mike Markkula's $91,000 put the company on the map. The authors illustrate various funding strategies: Georgette Mosbacher, an example of what the authors call "marrying money," acquired the cosmetics firm La Prairie; Frances Lear, an example of "divorcing money," launched Lear's magazine with her $112 million divorce settlement; and Tom Monaghan built Domino's Pizza through franchising.

The book closes with a warning that applying these laws will provoke organizational resistance. The Law of Perception conflicts with entrenched "better product" cultures. The Law of Sacrifice clashes with the desire to offer everything for everybody. The Law of Line Extension threatens what management considers a basic truth: that strong brand names can be extended into new categories. The authors counsel patience, concluding that management is mutable but the laws of marketing are not.