In its recent article, “The Quirks of Smallness,” The Atlantic examines the elements of smaller-sized companies, corporate boards, and leadership teams that “enable them to thrive.” The article cites a paper McDonough School of Business Assistant Professor Neeru Paharia co-authored with colleagues at Harvard Business School entitled “Positioning Brands Against Large Competitors to Increase Sales.”
While much research has been done on the “underdog effect,” Paharia et al. focused on how smaller brands can actually benefit from highlighting their larger competitors. The research appeared in the Journal of Marketing and found that:
Support for small brands goes up when faced with a competitive threat from large brands, versus when they are in competition with brands similar to them, or when consumers view them outside of a competitive context… this ‘framing the game effect’ is mediated by consumers’ motivation to express their views and have an impact in the marketplace through their purchasing.
As The Atlantic explains, the big-name coffee shop going in down the street may not signal the end for your favorite mom-and-pop hangout. It could be just the beginning.
Check out the full article here.