Crafting the Brand Positioning 10 Crafting the Brand Positioning Marketing Management, 13th ed

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? Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-2

Marketing Strategy Segmentation-- group of customers who share a similar set of needs and wants Targeting—consumer that can be satisfied in a superior way Positioning—a distinctive place in the minds of the target market

Positioning Act of designing the company’s offering and image to occupy a distinctive place in the mind of the target market.

Positioning

Writing a Positioning Statement Mountain Dew: To young, active soft-drink consumers who have little time for sleep, Mountain Dew is the soft drink that gives you more energy than any other brand because it has the highest level of caffeine.

Value Propositions Perdue Chicken Domino’s More 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 Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-7

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 FedEx—guaranteed overnight delivery Nike—performance Lexus—quality Miller Lite Beer—one-third less calories Points-of-parity (POPs) Associations that are not necessarily unique to the brand but may be shared with other brands Category—travel agency must be able to make air and hotel reservations, etc. Competitive—Miller Lite beer—taste great

Conveying Category Membership Announcing category benefits--able to deliver on the fundamentals reason for using a category (e.g., Brownie mix) Comparing to exemplars--used category membership parity (e.g., Tommy Hilfiger introduction compared its brand to Calvin Klein) Relying on the product descriptor--communicate unique position (e.g., In order for Ford to communicate a vehicle that had the attributes of an SUV, a minivan, and a station wagon and avoid association with its “Explorer and Country Squire models,” labeled the vehicle “Freestyle” to designated it as a “sports wagon” Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-9

Consumer Desirability Criteria for PODs Relevance--personally relevant and important Distinctiveness--superior (Splenda overtook Equal and Sweet ‘n Low) Believability--credible Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-10

Deliverability Criteria for PODs Feasibility—must be able to create Communicability—consumers must be able to understand benefits Sustainability—preemptive and defensible positioning Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-11

Examples of Negatively Correlated Attributes and Benefits Low-price vs. High quality Taste vs. Low calories Nutritious vs. Good tasting Powerful vs. Safe Strong vs. Refined Ubiquitous vs. Exclusive Varied vs. Simple Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-12

Addressing negatively correlated PODs and POPs Present separately Leverage equity of another entity Redefine the relationship Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-13

Differentiation Strategies Channel—more effectively and efficiently design distribution channel coverage, expertise, and performance. Personnel—better trained employees Image—crafting of powerful, compelling images (e.g., Marlboro, Hyatt Regency Hotels—atrium lobbies) Product Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-14

Product Differentiation Product form Features Performance Conformance Durability Reliability Reparability Style Design Ordering ease Delivery Installation Customer training Customer consulting Maintenance Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-15

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

Personnel Differentiation: Singapore Airlines

Image Differentiation

Product Life Cycle

Claims of Product Life Cycles Products have a limited life Product sales pass through distinct stages each with different challenges and opportunities Profits rise and fall at different stages Products require different strategies in each life cycle stage Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-20

Strategies for Sustaining Rapid Market Growth Improve product quality, add new features, and improve styling Add new models and flanker products Enter new market segments Increase distribution coverage Shift from product-awareness advertising to product-preference advertising Lower prices to attract the next layer of price-sensitive buyers Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-21

Typical Changes in Marketing Variables over the Product Life Cycle

Stages in the Maturity Stage Growth Stable Decaying maturity Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-23

Common PLC Patterns: a) small kitchen appliances, b) new drugs, c) new uses or users--nylon

Style, Fashion, and Fad Life Cycles: a) distinctive mode of expression, b) currently accepted or popular style, c) fashions that come and go quickly

Marketing Product Modifications Quality improvements—increasing functional performance Feature improvements—adding new features—size, weight, materials, additives and accessories Style improvements—increasing the product’s esthetic appeal Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-26

Marketing Program Modifications Prices Distribution Advertising Sales promotion Services

Ways to Increase Sales Volume Convert nonusers Enter new market segments Attract competitors’ customers Have consumers use the product on more occasions Have consumers use more of the product on each occasion Have consumers use the product in new ways Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-28

Market Evolution Stages Emergence Growth Maturity Decline Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-29

Emerging Markets Latent Single-niche Multiple-niche Mass-market

Market fragmentation stage—focus on different segments of the market Maturity Strategies Market fragmentation stage—focus on different segments of the market Market consolidation stage—emergence of a new attribute that has strong appeal Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-31

Product in Decline

All marketing strategy is built on STP Study Question 1 All marketing strategy is built on STP segmentation, targeting, and ________. Positioning Product Planning Promotion performance Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-33

Study Question 2 A starting point in defining a competitive frame of reference for a brand positioning is to determine ________the products or sets of products with which a brand competes and which function as close substitutes. functional membership competitive field category membership value membership demand field Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-34

Study Question 3 The preferred approach to positioning is to inform consumers of a brand’s membership before stating its ________. point-of-parity point-of-difference point of conflict point of weakness point of reference Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-35

Study Question 4 Marketers must decide at which level to anchor the brand’s points-of-differences. At the lowest level are ________. For example, Dove soap can talk about the fact that it is one-quarter cleansing cream. brand values brand attributes brand benefits brand specifications brand partitions Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-36

Study Question 5 ________ is a company’s ability to perform in one or more ways that competitors cannot or will not match. Positioning Deliverability Competitive advantage Distribution Differentiation Copyright © 2009 Pearson Education, Inc.  Publishing as Prentice Hall 10-37