How can you compete against a household-name brand like Kleenex or Q-Tip that has become a generic? You cannot. It is next to impossible to overtake a generic. Why? Because you were not first. But that does not mean you cannot win the battle…
You compete with a generic by creating a new category. Narrow your focus. Think in sets and subsets and specializations. Fed-Ex, for example, commandeered a narrow segment of the courier category by creating a new subcategory: overnight delivery.
Do not try to compete against the #1 brand by doing what they do, hoping that you can capture a fraction of their market. Do the opposite of what they do. Uniqueness will beat trend-following every time.
Creating a powerful new brand means looking for ways to divide and conquer. How can your product or service can diverge from the existing category? Exploit divergence to create a new category that your brand can own. Over time, categories almost always diverge, with or without you. Knowing that divergence always happens helps you pinpoint the right time to act.
Now, once you become the leading brand, you can count on competitors popping up, and some of your customers will venture off to try the competitor’s brand. It is usually better to let them go and focus your energy on attracting new customers. Grow the market, instead of trying to expand your brand to win the defectors back. That is how you maintain brand purity—authenticity. That is how you make sure you still stand for something in the customer’s mind. The new brand that defines a category will almost always outsell the old brand that was stretched to encompass the new category.
If you are the minor player, you win the line-extension war by encouraging the new category to diverge. Create a new category and put some distance between your new category and the old category. In doing so, you differentiate your new category (and your brand) from the dominant brand.
You must compete to win.