Financial terminology
Inmarketing, afighter brand (sometimes called afighting brand or aflanker brand) is a lower-priced offering launched by a company to take on, and ideally take out, specific competitors that are attempting to under-price them. Unlike traditionalbrands that are designed with target consumers in mind, fighter brands are created specifically to combat a competitor that is threatening to take market share away from a company's main brand.[1]
A related concept is theflanker brand, a term often found in themobile phone industry and elsewhere.[2][3] In the case of flankers, ormultibranding, the products may be identical to the main offerings and the new brand is used to expand product placement.
Use of a fighter brand is one of the oldest strategies in branding, tracing its history tocigarette marketing in the 19th century. The strategy is most often used in difficult economic times.[4] As customers trade down to lower-priced offers because of economic constraints, many managers at mid-tier and premium brands are faced with a classic strategic conundrum: should they tackle the threat head-on and reduce existing prices, knowing it will reduce profits and potentially commodify the brand, or should they maintain prices, hope for better times to return, and in the meantime lose customers who might never come back. With both alternatives often equally unpalatable, many companies choose the third option of launching a fighter brand.
When the strategy works, a fighter brand not only defeats a low-priced competitor, but also opens up a new market. TheCeleronmicroprocessor is a case study of a successful fighter brand. Despite the success of itsPentium processors,Intel faced a major threat from less costly processors that were better placed to serve the emerging market for low-costpersonal computers, such as theAMD K6. Intel wanted to protect thebrand equity and price premium of its Pentium chips, but also wanted to avoid AMD gaining a foothold into the lower end of the market. This led to Intel's creation of the Celeron brand, a cheaper, less powerful version of Intel's Pentium chips, as a fighter brand to serve this market.[5]
- Australia:Qantas launchingJetstar to take onVirgin Blue.Telstra,Optus andVodafone respectively launchingBelong, Gomo and Felix Mobile to take onMVNOs such asAldi Mobile,Amaysim,Boost Mobile andTPG Mobile.
- Canada:Rogers Communications andTelus Mobility respectively launchingChatr andKoodo Mobile/Public Mobile to take onMobilicity andWind Mobile.[6]Shaw Communications andVidéotron respectively launchingShaw Mobile and Fizz Mobile to take onBell Mobility'sLucky Mobile.
- France:Orange,SFR andBouygues Telecom launching Sosh, Red by SFR and B&You to take onFree Mobile.
- Ireland:eir launchingGoMo to take onAn Post Mobile (formerly Postfone, MVNO usingVodafone towers), 48 Mobile andTesco Mobile (MVNOs usingThree towers).
- Italy:TIM,Vodafone andWind Tre respectively launchingKena Mobile (formerlyNòverca),ho-mobile andVery Mobile to take onIliad.
- Germany:Merck Sharp & Dohme launching Zocor MSD to take on generic brands and protect Zocor in Europe.Deutsche Telekom,Vodafone andO2 respectively launchingCongstar, Otelo andBlau Mobilfunk initially as budget-focused counterparts of their regular mobile phone offerings, and later repositioned somewhat to take on1&1 Drillisch.
- Philippines:Globe Telecom launchingGoMo to take onDito Telecommunity with comparable data offerings.
- Russia:Philip Morris launchingBond Street to take on local brands and protectMarlboro.
- Singapore:Singapore Airlines launchingScoot as an eventual successor toTigerair to take onAirAsia andJetstar Asia. Singtel andStarHub launching GOMO and Giga to take onCircles.Life andTPG Telecom.
- Sweden:Telia,Tele2,Telenor and3 respectively launchingHalebop,Comviq,Vimla andHallon as lower-cost, prepaid and no binding contract counterparts of their regular mobile phone offerings.
- Switzerland:Swisscom,Sunrise andSalt Mobile respectively launching Wingo, yallo and swype, andGoMo as hybrid-prepaid and lower-cost counterparts of their regular mobile phone offerings.
- UK:British Airways launchingGo to take onRyanair andEasyJet.Tesco creatingJack's to counter growing competition from low-cost German supermarket chainsAldi andLIDL.[7]Vodafone launchingVOXI to take onO2'sGiffgaff,Three'sSMARTY andEE'sBT andPlusnet.
- USA:General Motors launchingSaturn to take on Japanese imports into America.[citation needed]Whole Foods launching 365 to take on lower-priced grocery stores such asTrader Joe's and Sprouts.[8]
