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T-Mobile, Royal Prestige, Red Robin and Trivago: The Challenger Brands

By Roberto Ruiz, EVP - Research, Insights and Analytics

“When you Google ‘challenger brand,’ you get millions of hits and see millions of conversations,” said Chad Dick, partner at EatBigFish, the consultancy that coined the term. So, yes, it’s a hot topic and exactly why we invited Chad to Leading the Change to host a discussion with brands that embody the Challenger mindset.

But, we did it with a Univision twist. The question at hand was: how do you take your Challenger mindsets and beliefs and apply them to the Hispanic segment?

Chad kicked off the conversation with Five Keys to Being a Successful Challenger Brand. I’ll show how they came to life through our panel featuring:  Peter DeLuca, SVP of Marketing, T-Mobile; Jon Eichelberger, head of Business Development & Strategy for North America, Trivago; Jim Lucero, managing director, Camelot Communications (on behalf of Royal Prestige); and Missy Robinson, marketing manager, Red Robin.

  1. Get Clear on the Challenge – Shift your thinking from “Who am I challenging in the marketplace” to “What am I challenging?” The notion of David vs. Goliath as the only challenger flavor is an outdated one. T-Mobile took on the mission of changing wireless for the better by putting control in the hands of the consumer. “We wanted to force real change in an arrogant industry that had absurd practices that were affecting a lot of people,” explained Peter.
  2. Question the Rules – T-Mobile got rid of contracts – think anyone misses them?  They also specifically delight Hispanic consumers with rule-breaking offerings like an exclusive offering with Univision called Univision Mobile, no-roaming charges across North America (U.S./Mexico travel headaches be gone!) and Musica Non Stop, which eliminates data charges while streaming music. That’s the sound of a collective consumer segment saying İgracias!

Jim shared how Royal Prestige first challenged the cookware industry by going with an Avon-like sales approach. But it wasn’t until they identified their core consumer for their high-end pots and pans as Spanish-dominant Hispanics that the brand really took off.  “The Company puts $1500 cookware into homes of primarily Mexican immigrants, and we do this by focusing on functional and emotional benefits. If she can make better, healthier food for her family, mami listens and is willing to pay more.” For Royal Prestige, luxury doesn’t have to be defined by what you spend; it can be about how the consumer experiences it.

  1. Lead with Belief – Red Robin is getting its house in order before truly activating its Hispanic strategy. Here’s a core belief Missy shared: “It’s not a strategy, program or initiative. Hispanic is just the way we’re going to do business moving forward.” That conviction travels all the way to the C-Suite. “I’m very lucky that I’m not fighting my way up to get that message out.” Also, this gourmet burger authority is going to remain just that: “I don’t think anyone is ever going to say, ‘Hey, I just can’t wait to have those enchiladas at Red Robin.’ We want to remain authentic to our brand.”
  2. Be the Thought Leader – I’d venture to say that sitting on our Leading the Change panel – and other public endeavors like it – is one way to be perceived as a thought leader. Jon shared more from Trivago’s point of view. First, they use the fact that they’re based in Europe to their advantage, exhibiting cultural nimbleness. “We have 55 different nationalities sitting in one office in Dusseldorf. That diversity of thought has helped us succeed in many markets.” Second, Trivago realizes that you gain a thought leadership advantage by being first so finding the white space and moving quickly is a key strategy. “We were the first travel vertical to actively pursue a Hispanic audience in the U.S., and it was because we had the cultural know-how.” And finally, Trivago’s mantra keeps the brand ahead of the game: “Fail often, fail quickly and fail cheap.”
  3. Sacrifice to Over-Commit – Chad advised brands to “just say no.” You can’t be all things to all people and still stand for something meaningful. Trivago understood this early and decided to focus on hotels and hotels only. For Royal Prestige, Jim added: “It’s not so much that we’ve said no to the ‘general market,’ it’s just that we’ve said yes with Hispanics…From a company that went from exclusively English to now exclusively Spanish says something about the potential of the Hispanic market.”

I think what it says loud and clear is: there’s a payoff to “challenging” with a Hispanic strategy. If you want specifics, Peter was happy to share them – 27% of T-Mobile’s customer base today is Hispanic.

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