Copycat Marketing

‘Copycat… Copycat…’ this what we used to call each other as kids in Canada when you did the same funny face, joke, drawing or anything else that 8 year old kids do. As we get older the name-calling has stopped but we still end up copying ideas, methods or products – well at least it seems that way.

We need to remember that copying is not only for normal people like you and me but also for world renowned demi-gods such as Steve Jobs. Steve Jobs did not invent the tablet as we know today as the iPAD. Microsoft was one of the first pioneers in creating a tablet and they failed miserably. Steve Jobs did not invent the device to digitally store music such as the iPod. Others did before but Jobs perfected the concept, he made it appealing, he had the courage and diligence to price it at a premium and the rest is history.

There are countless examples of products that seemingly were invented by one person only to recognize that the idea was not originally theirs. Does that qualify as copying?

Peter Cochrane, a speaker on innovation and future trends usually starts his speeches by saying: ‘If I replicate what you have and I launch it on the market – that’s copying. If I have a team doing the same thing, that’s called research’.

From personal experience having lived in Asia for 4 years I have come back with a more relaxed view on copying. It was quite common for a businessman in Bangkok, Thailand with a retail location to open an ‘innovative coffee shop’ only to find 4 more ‘innovative’ coffee shops open on the same street and vicinity 4 weeks later. Who wins? The customer of course! Over time 3 out of 4 of these copycats would close down leaving the last 2 to fight till the bitter end. Survival of the fittest as Darwin would call it.

China is renowned for being open to foreign investment. After all, when a large mobile network equipment vendor like Alcatel decided to invest in China in the late 90’s, they did so for all the right reasons: Investment subsidies, grants or special taxes, access to low cost labour, large market of 1,2 billion people and a foot in Asia. This made good business sense. However as new competitors popped up like Huawei or ZTE with seemingly the same technology Alcatel had to wonder: How did they come up with the same technology so fast?

The other choice for Alcatel? You mean…NOT investing back then in China?

Can you imagine going back to HQ in Paris and saying ‘you know what? We should not invest in China…it’s too risky and they may copy our Intellectual Property (IP); in fact we should forget about China altogether’ as their competitors proceeded to throw themselves into China. I don’t think so!

There are a lot of imitators in the digital marketplace too. Ones that come to mind are Alexander, Oliver and Marc Samwer, three brothers in Germany who have built copies of AirBnB, eBay and Groupon across various European countries. Innovation for them is shall I say, effective and they have made some good money in the process. Their clone ‘factory’ is called Rocket which incubates dozens of internet start-ups – many of which take their business plans from Silicon Valley. They have learned to scale rapidly, and customize online companies to European tastes and cultures – which explains their success.

I have come to realize that any business idea is derived from something that preceded it. The level of copying in any new product or service is simply a matter of degree. Unless you specifically infringe a patent, design, trademark or copyright, or are very obviously passing off your goods as if they were a competitor’s product, you can profitably use that idea.

Bill Gates once said that ‘Intellectual Property has the shelf life of a banana’. Given what the Jobs and the Gates of this world have done what should we do? What is morally acceptable? Do we copy or do we innovate?

Let me give you a few suggestions to keep you focused on innovation instead of worrying about copycats:

1) If you have invested a lot in your technology then get your legal department to prepare the patent applications for you. Keep in mind however that often, the imitator’s technology can be more refined and entirely legal.

2) Don’t get hung up or too comfortable on your product or service ‘supremacy’. If you feel that you have an important competitive differentiator with your improved ‘taste/flavor/model’, make sure your product development team is preparing the next best thing. Your competitor is watching and most probably will copy.

3) Be proactive by running informal sessions with customers and get them to brainstorm with you. This is where needs are identified: At the source. Imitators may have come out with the product but as Jobs showed us, did it really meet the need?

4) Allow time off for technical people to putter on pet projects, this is called “tinkering time’. Gmail and Google News were introduced because of tinkering time. 3M also provides up to 20% of work time to work on pet projects.

5) Ask customers about problems with products and set up an idea workshop. Challenge customers to improve products. This is another way of identifying insights and “A-Hah’ moments.

Oded Shenkar, is a professor at the Fisher College of Business at the Ohio State University, and author of Copycats: How Smart Companies Use Imitation to Gain a Competitive Edge. He claims that just copying a market leader in every respect isn’t clever: instead, do what they do only better, cheaper and with a different spin. And get a move on – the originator is unlikely to simply sit back and watch you steal their market.

The nice thing about your competitor advertising their new product, be it yogurt, laptops or insurance is that you ultimately gain from this added awareness in the market.

Finally, before you start calling your competitor ‘Copycat …Copycat’ remember:

At the end of the day like our friend Steve did magnificently, it’s execution that is important, not the idea.

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