The Underdog Effect – and How to Make it Work in your Favour

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The business world can be a seriously daunting one at the best of times, and there’s nothing more intimidating than when you’re trying to differentiate yourself from a well-established goliath of a competitor.

However, help is at hand in the form of some good ol’ brain quirks.

The human mind is a beautiful and complex thing, but whether or not you buy into things like the Oedipus Complex, there are some characteristics of human psychology which you simply cannot deny.

One of those oft-referenced psychological traits is that we love an underdog. Various studies have suggested that the human condition has predisposed us to automatically back an outsider in a variety of contests, with our entire allegiance switching based on which side we perceive to be the one on the brink of defeat or facing the biggest challenge to succeed.

In a Premier League football game for example, we’re naturally inclined to back a team that’s just been promoted into the division over the incumbent champions. However,  but if the lesser-fancied team is winning 3-0 with minutes to go, the effect can counteract itself and we may find ourselves supporting the big team in the hope they make an incredible comeback.

Although there’s overwhelming scientific evidence that our love for the underdog is hardcoded, there’s less of a consensus on what actually causes us to back the little guy to succeed over the behemoth. One study links it to schadenfreude, where it’s not so much a case of us supporting the underdog but rooting “against the dominant entity.” Another demonstrates the fact that we experience more joy from unexpected victories than ones we anticipate, and therefore actively seek out opportunities for these situations.

Whatever the reason, the underdog effect is very real, and when utilised correctly, it can do more to level the playing field than anything else in terms of branding.

The Underdog Effect in Action

Chicago Cubs' Wrigley Field

American sports are a fertile breeding ground for underdogs and loveable losers. The absence of relegation and tiered league systems means that the same teams have the opportunity to lose and fail in the spotlight over and over again, while still only technically being one good season away from being the best.

There are two MLB teams from Chicago, the Cubs and the White Sox.

While neither are particularly successful, the White Sox have the edge over the Cubs. The Cubs have won the World Series twice – both over a century ago, in 1907 and 1908 – and haven’t managed to win the National League pennant since 1945. Their barren period is currently the longest-running drought in American sport, and actually stretches back to before the NFL, NHL and NBA even existed.

The White Sox have three World Series – 1906, 1917 and 2005 – as well as two American League pennants since the Cubs won their last one.

And yet, the Cubs are one of the most ubiquitous names in baseball. Their “brand” has transcended interest in the sport (Ferris Bueller even paid the Cubs’ Wrigley Field a visit on his day off), while the White Sox remain mired in relative obscurity, unknown to most beyond the baseball fraternity. Famed Chicago-based journalist Richard Roeper has even been asked if the White Sox are a farm team.

Chicago Cubs' 1908 World Series winning team

The Cubs have literally become famous for their failures and their status as perennial underdogs has won them countless fans all over the world. Closer to home, their average attendance for the 2014 season dwarfed that of the Sox by over 10,000 people and the Cubs were the fourth biggest draw on the road, bigger than the Boston Red Sox.
It’s often the same in business. Companies deliberately play up to an image of being small in order to entice customers in. Just think of how many food companies go out of their way to present the idyllic pastoral image of an old family recipe being passed down through generations with their branding.

KFC logoUncle Ben's logo

How not to take advantage of the Underdog Effect

Important not to become moany and whiny – we all knew that one person when we were in our mid-to-late teens who would consistently bemoan their (invariably pretty modest) misfortunes. This is what I’m going to call the Emo Effect, and it’s one that wears thin very quickly.

Another pitfall you must work hard to avoid falling into is what I’m terming the Loveable Loser Effect. While it’s important to stress your underdog credentials, you must also be at pains to point out that while you are the underdog, you’re not there because you deserve to be. It’s just that your competitor has been around for longer or is part of a huge corporation.

Your product is better, you customer experience is miles ahead, and it’s only a matter of time before it’s your well established competitor that is the underdog. You’re on an upward trajectory, and your potential customers have the opportunity to get involved before you have your shock World Series win. You don’t need pity.

It’s also worth noting that the underdog effect is much less pronounced – and can even be harmful – in certain industries, particularly ones that involve an element of risk or danger. You’d trust Aunt Bessie to make the sprinkles for your cakes, but perhaps not to provide medical equipment to hospitals.

Energy drinks are a good example of this. Despite existing in the same realm as the homely baking brands mentioned above, the energy drink industry features a constant bombardment of terms like “electrolytes” being thrown about to make the drinks appear more scientific. As soon as a technical or scientific element becomes involved in the buying decision process, we’re automatically attuned to follow experience and reputation rather than the underdog.

How to turn the Underdog Effect to your advantage

Think about your main competitors.

What are they known for? What are the criticisms of them you’ve heard on a regular basis? What would you say to someone if you were trying to persuade them to go with your product over theirs (think elevator pitching LINK – unless can write an article on)?

When looking at their reputation, you’ll be able to pinpoint a few things that they’re particularly known for. Rather than shying away from these things, you can counter them before the potential customer has even consciously made the connection and turn your competitive weaknesses into strengths.

Common top dog attributes – and how to combat them

They’ve been around for years, decades even.”

Your company is new and exciting, with new and exciting ways of doing things.

They have huge experience.”

Your team may be small, but it’s made up of the best experts around.

Experience also breeds complacency; everyone knows the Henry Ford quote about people wanting faster horses; you’re the innovators who can see beyond “this is the way we’ve always done this” thinking.

They have a huge share of the market.”

The point of market share is also a great way of drilling down into the niche appeal of your product – it may not be all things to all people, but it can do a better job for some than your competitor’s one-size-fits-all product.

They have a long history of success.”

Here’s where things get interesting. As well as the dreary, monotonous success after success stories of many of the world’s most established brands suggesting potential for complacency, the simple fact is that most people simply do not care how many new overseas markets a company moved into in 1986. Research by the European Institute of Brand Management shows that “brands with a brand biography that highlights their underdog position are better liked than top-dog brands.”

What they do care about is what it’s in it for them, but contrary to some popular wisdom, that does not mean simply never talking about yourself.

What it does mean is that you need to create a human connection. People are much more likely to buy from a brand with whom they feel they have shared an experience, and that can come in any number of forms. Did your product start out in your garage as a hobby? Has your business ridden out the Great Recession against all the odds?

Give potential customers the opportunity to see a little of themselves in your business or product.

Thanks for reading, and I’d love to hear about your underdog victories in the comments below – I’m always looking for new case studies!

Images courtesy of ESPN, Uncle Ben’s, KFC

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