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We continue with our discussion on comparisons with competition to asses our brand and develop a customer oriented model.

Question 3

This question (opportunities for growth and expansion) demands clarity of the following two factors:
• What are customers’ beliefs about the segment and the category?

• What unmet needs are there, which can be addressed? Since we are attempting to learn how to come up with a brand-based customer model, the focus of this question remains customers’ perspective and not company’s own. You have to make an effort to unearth how customers feel about benefits and values that must be offered by brands within the category. As an example, a telephone company (a private sector company) may find out from customers that they (customers) will like to have telephone and internet facility through the same line without disturbance of one by the other. Another example could be that of an internet service provider (ISP) to start offering wireless internet services to fulfill customers’ need for a trouble-and frequency-distortion free connection only after having been in contact with its customers. The key to understanding customers’ perspective is to stay in contact with them, either through structured research or informal contact. A Japanese company follows as a regular practice their senior managers’ contact with Japanese families through pre-arranged appointments. The executives talk with the families to find out their comments on the needs that still remain unmet or the ones that have sprung up merely due to circumstantial evolution1. They seize the opportunity and give a solution to customers. They know that they cannot stay the course too long. Competition will jump in and occupy the slot that very naturally could have been theirs. The clarity on the two factors is a prerequisite to understanding to what extent are there opportunities to expand? An in-depth analysis will lead to some blank areas in terms of customers’ beliefs. Even if the company managers are sensitive to fulfill unmet needs owing to their knowledge of the market, knowing customers’ point of view will only strengthen managers’ strategic thoughts and planned moves.

Summary – brand-based customer model, lecture 14 through here

A brand-based customer model is all about creating, maintaining, and leveraging your brand by keeping the focus on customers. We have to stay close to the customer and make the customer the basis of all branding decisions. Seek customers’ perspective of competitors’ products as well and have formal and informal ways and means to assess your brand as it stands in the competitive setup. In other words, understand your brand vis-à-vis competition to make realistic decisions about sustaining your brand. Keep you brand current and contemporary through innovations and maintain the pinnacle of the brand value pyramid. Understand the category from customers’ point of view and identify all those needs that are still unmet. That will give you leads into expanding and growing your business. If you go slowly, then competition will not waste a moment to take over.

POSITIONING

An understanding of the category and the roles played by competition (all brands) leads us to develop the positioning for our brand. Positioning is very central to having the right strategies at work to achieve our brand management and overall business goals. Positioning is an approach to communication that solves communication problem by highlighting very special features of your brand. It is important to understand why and how it started?

Product era

It started in the middle of the last century, in fifties. Back then, it was the product era. New technologies were emerging and subsequent innovations led to emergence of a host of new products and their variations. Advertisers and advertising agents thought it prudent to talk about the differentiated features of their products in a fairly straightforward manner. Consumers saw the difference and advertising made its mark. This was the time of unique selling proposition USP. Talking about the USP is not discarded even today. However, the objective here is to have the historical perspective right. With technology reaching a high level across so many categories and boundaries, level of innovations decreased while communication remained at its peak. The net result was that everyone was talking about almost the same thing because there were a lot of “me-too” products and that marked the end of an era – “the product era1”

Image Era

Advertising experts thought of changing the strategy to revitalize advertising and that marked the beginning of an era known as “the image era”. The general thinking was – talk of the image and the consumer would pay attention. If the product era was killed by me-too products, the image era was killed by me-too companies2. As and when industry and markets graduated from one era to another, the level and magnitude of communication increased exponentially. Communicating was the norm and thought of something that would do the trick for marketers. Resultantly, the problem all marketers faced was of over-communication. It is interesting to note that the two advertising executives who propounded the very concept of positioning back in the 1970s for the first time called that era over-communicated. The question that arose so many years ago, and is still valid, is, “how to communicate and get heard in the overly communicated society”.

The Positioning Era

The two authors of the concept believe that to be successful you have to touch base with reality3. The only reality that counts is what is already in the mind of the prospect. Creativity for the sake of creating something new does not help. And, therefore, image building through advertising meant to create something that does not already exist in consumer’s mind doesn’t help. Creating something of that sort is very difficult, if not outright impossible, the authors believe. In other words, the thrust of the concept of positioning is to do something effectively with what already exists in prospect’s mind and then capitalize on it. Therefore, the basic approach of positioning is not to create something new, but to manipulate what is already there in the mind and to retie the connections that already exist, claim the authors4. As a defense mechanism against over-communication, the mind rejects a lot of information and accepts only the one that matches with the prior knowledge, or that complements the prior knowledge. The only defense mechanism is that a person has an oversimplified mind. Marketing people therefore should ignore the sending side and do something with the receiving side – the prospect’s mind. You concentrate on the prospect’s perceptions and simplify the process.

Positioning therefore is not something that you do to the product. It is something you do to the prospect’s mind. You position the product in the mind of the prospect.

How positioning works

Experience has it that positioning works best when you emphasize on things that are not. If you introduce chewing gum for health conscious people, you position it as “sugar-free”, meaning it is not sugar.

The first car was advertised as the “horseless” carriage. It had no horse and hence it was different. That positioned the new invention against the transportation of the time. You highlight the differentiated feature by talking of something that is not there, but at the same time is in the mind of the prospect. This is a good example of manipulating something that already exists in prospect’s mind. Things -that are not -can be found in areas other than the basic product itself. This implies that to effectively position a product in prospects’ mind, you do not always have to talk about the product itself. If you introduce a low-price item in response to a genuine need, you can position it from price point of view and talk of the product as a low-price item, meaning it is not a high-price item. Improving distribution with the help of a new product can go a long way in positioning it as the one that has hassle-free distribution.

An important factor

The most important thing is that you have to be the first one to get into the consumer’s mind with the position that you want occupied⁵. The market research that we carry out as part of customer-based model help companies identify the areas of growth and expansion and therefore identification of the genuine unmet needs. You must take the lead, start talking of the unmet need(s), and be the first one to get into the minds of the prospects.

Bibliography:

1.  Geoffery Randall: “Branding – A Practical Guide to Planning Your Strategy”; Kogan Page (53)

2.  Al Ries and Jack trout: “Positioning: The Battle for Your Mind”; McGraw Hill (23)

3.  Al Ries and Jack trout: “Positioning: The Battle for Your Mind”; McGraw Hill (24)

4.  Al Ries and Jack trout: “Positioning: The Battle for Your Mind”; McGraw Hill (24)

5.  Al Ries and Jack trout: “Positioning: The Battle for Your Mind”; McGraw Hill (24)

Suggested readings:

1.  Scot M. Davis: “Brand Asset Management – Driving Profitable Growth through Your Brands”; Jossey-Bass, A Wiley Imprint (91-105)

2.  Al Ries and Jack trout: “Positioning: The Battle for Your Mind”; McGraw Hill (5 27)