10Crafting the

Brand Positioning

1

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Chapter Questions How can a firm choose and communicate

an effective positioning in the market? How are brands differentiated? What marketing strategies are appropriate

at each stage of the product life cycle? What are the implications of market

evolution for marketing strategies?

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Marketing Strategy

Segmentation Targeting Positioning

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Positioning

Act of designing the company’s

offering and image to occupy

a distinctive place in the mind of

the target market.

Positioning: Creating Brand Image and Personality

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Value Propositions

Perdue ChickenMore tender golden chicken at a moderate

premium price Domino’s

A good hot pizza, delivered to your door within 30 minutes of ordering, at a moderate price

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Writing a Positioning Statement

Mountain Dew: To young, activesoft-drink consumers who have

little time for sleep, Mountain Dewis the soft drink that gives you

more energy than any other brandbecause it has the

highest level of caffeine.

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Defining Associations

Points-of-difference (PODs)

Attributes or benefits consumers strongly associate with a brand, positively evaluate, and believe they could not find to the same extent with a competitive brand

Points-of-parity (POPs) Associations that are

not necessarily unique to the brand but may be shared with other brands

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Conveying Category Membership

Announcing category benefits

Comparing to exemplars

Relying on the product descriptor

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There Are Two Positioning Extremes

Performance Style

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And BMW Satisfies Both

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Choosing POPs and PODs

Relevance Distinctiveness Believability

Westin-Stamford Singapore: The World’s Tallest Hotel

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Deliverability Criteria

Feasibility Communicability Sustainability

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Examples of Negatively Correlated Attributes and Benefits Low-price vs. High

quality Taste vs. Low

calories Nutritious vs. Good

tasting Efficacious vs. Mild

Powerful vs. Safe Strong vs. Refined Ubiquitous vs.

Exclusive Varied vs. Simple

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Addressing Negatively Correlated PODs and POPs Present separately Leverage equity of another entity Redefine the relationship

Brand Mantras

Designing a Brand Mantra

Communicate

Simplify

Inspire

Constructing a Brand Positioning Bull’s-Eye

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Differentiation Strategies Product Personnel Channel Image

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Identity and Image

Identity:

The way a

company aims to

identify or

position itself

Image:

The way the

public perceives

the company or its

products

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Product Differentiation

Product form Features Performance Conformance Durability Reliability Reparability

Style Design Ordering ease Delivery Installation Customer training Customer consulting Maintenance

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Image Differentiation

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Personnel Differentiation

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Channel Differentiation

Brand Positioning create/maintain a unique representation of the

brand in customers’ mind to stimulate choice of that brand

positioning = more in the mind than in the market advertising adds value to a product by changing our

perception, rather than the product itself creating added intangible value, without changing the

product it is not about laboring, engineering, raw material

Positioning Effect

Pepsi challenge – cola wars

“marketing blunder of the century”• Coca cola underestimated the intangible,

symbolic value to the target audience of the original product

• Coca-Cola executives announced the return of the original formula on July 10, 1985

– after 79 days (April 23 - July10), the original-recipe Coke was back on the market as “Coca-Cola Classic.”

children’s taste test (3- to 5-year-old) one-quarter of a McDonald's hamburger

partially wrapped in a white McDonald's wrapper showing the McDonald's logos and the word Hamburger in brown

the other wrapped identically in a matched plain white wrapper of the same size and material a Chicken McNugget

in a white McDonald's bag with a red arches logo and the phrase Chicken McNuggets in blue the other in a matched plain white bag

McDonald's french fries in a white bag with a McDonald's yellow arches and smile logo on a red background and the words "We

love to see you smile" in blue on yellow along the edge in a matched plain white bag

3 ounces of 1% fat milk in a white McDonald's cup with lid and straw in a matched plain white cup with lid and straw

2 "baby" carrots placed on top of a McDonald's french fries bag on top of a matched plain white bag

Robinson, T, Borzekowski, D., Matheson, D., Kraemer, H.(2007). Effects of fast food branding on young children’s taste preferences. Archives of Pediatrics & Adolescent Medicine, 161 (8), 792-797

summary

“brands” (intangible attributes) may transform “products” (tangible attributes) brands have intrinsic product qualities

ABS, high performing engines

brands have extrinsic representational qualities (“badge value”)

fulfilling emotional and psychological needs wearing a swatch ≠ wearing a rolex

brand positions exist in people’s head/hearts marcoms can greatly influence brand positions

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Product Life Cycle Introduction Growth Maturity Decline

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Facts about Life Cycles

Products have a limited life. Product sales pass through distinct

stages. Profits rise and fall at different stages. Products require different marketing,

financial, manufacturing, purchasing, and human resource strategies in each stage.

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Marketing Program Modifications

Prices Distribution Advertising Sales promotion Services

Panadol’s Ad by Ogilvy

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The Product Life Cycle: Critique

Life-cycle patterns are too variable in shape and duration.

Marketers can seldom tell what stage the product is in.

PLC stage should be a dependent variable which is determined by marketing programs; it is not an independent variable to which companies should adapt their marketing programs.

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Market Evolution Stages(a market-oriented picture of a product/a firm) Emergence Growth Maturity Decline

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Emerging Markets

Latent Single-niche Multiple-niche Mass-market

Developing Value Proposition for Business Markets*)

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Customers may only look at

price, and not listen to your sales pitch

*) Anderson, James C., James. A. Narus, and Wouter van Rossum (2006), “Customer Value Propositions in Business Markets, HBR, March.

Types of Value Proposition

1. ALL BENEFITS

Pitfall: Many or even most of the benefits may be Points-of-Parity -- with those of the next best alternatives (competitors) – diluting the effect of the few genuine Points-of Difference.

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Types of Value Proposition

2. FAVORABLE POINTS-OF-DIFFERENCE Answering the question of: “Why should our

firm purchase your offering instead of your competitor’s?”

Pitfall: Assuming that favorable points of difference must be valuable for the customer.

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Types of Value Proposition

3. RESONATING FOCUS Value Proposition which contains the critical issues in

customer’s business, is simple yet powerfully captivating.

Superior on few elements that matter most to target customers.

Demonstrating and documenting the value of this superior performance, and communicating it in a way that conveys a sophisticated understanding of the customer’s business priorities.

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Distinctive Value Proposition (Resonating Value Proposition)

A Point-of-Parity (what customers may mistakenly presume to be a POD favoring a competitor’s offering).

Several Points-of-Difference Also: Points-of-Contention (elements where

supplier and customer disagree how their performance compares with those of the next best alternatives).

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