Upload
kapeelk
View
1.362
Download
3
Tags:
Embed Size (px)
DESCRIPTION
Citation preview
Delivering Value Through Market
DifferentiationThe Brand: The Customer’s
Perspective & The Marketer’s Response
Sourced from Articles about Brand BuildingKapeel Kapoor
Brand -An anchor for the customer in the Sea of Products
• As a variety of competitive claims assails her senses, today’s customer uses a complicated decision-making process to assess the alternatives available before making a purchase.
• The more clearly the brands associated with a particular set of attributes – in terms of benefits and prices – the quicker becomes her search process
Challenge for the MarketerCreate perceived value for the customer
• Instead of having to compare every variable about one product with another, she uses her personal rating of each competing brand to make comparisons
• Challenge for the marketer, is to use the tools of branding and pricing to ensure that the most valuable package – in the customer’s perception is represented by his brand
Creating DifferentiationCreate perceived value for the customer
• First marketer must position the brand in the customer’s mind in a distinctive slot – – far enough to be unique, and
– close enough to meaningful benefits
to provide unmatched value
• To fill the different value gaps that arise from the segmentation of the consumer base, he must build a portfolio of brands, using brand extensions to augment the core value
Managing Price-Value equationCreate perceived value for the customer
• Then must use price to create expectations of particular levels of value from his brand – and exceed those expectations
• While premium pricing will create one kind of price-value equation, competitive pricing will create another
• Successful marketer must manipulate both equations to his advantage
Aware-ness
of Need
Exposureto Brand
Under-standing of Asso-ciations
Under-standing of Price
Comparison with other
Brands
Under-standing
ofDistinctive-
ness
Judge-ment ofValue
BrandBenefits
BrandAttributes
BrandProperties
Time-Stability
ofEval-
uation
Confidenceof
Evaluation
IntensityOf like/Dislike
Action
Create Brand Associations
Add value throughNeutral Pricing
Add value throughDifferential Pricing
Extend the Brand Portfolio
The Brand: The Customer’s Perspective & The Marketer’s
Response
Adding Value Through
Positioning
The third strategic ‘P’ Positioning
Challenges• Differentiate your brand from competitors• Occupy a distinct space in the customer’s
perceptions of all brands in your product category• Use that space to convey every one of the
associations attached to your brand • Through it all add customer value
ConstructCutomer’sMind map
Plot PositioningOf Brands
OnMindmap
IdentifyGaps onThe Map
ExtendExisting
Valuedimension
Create new Value
dimension
Locate SpotsRepresenting
Ideal valuecombinations
PositionBrandIn Gap
How to Add Value Through Positioning
Do TheyRepresent
Value
Is theDimensionrelevant?
No Yes No Yes
EnsureIncrease
InCustomer
value
Positioning Creating the Mindmap
Step I• Constructing a visual map of the customer’s mind• Mindmap – A flat space divided inot four quadrants by two
axes, each of which represents the continuum of a particular brand attribute – such as expensive/ cheap; caring/ efficient; serious/ frivolous
• On this mind map – each spot represents a unique combination of attributes represented by the 2 axis
e.g. Britannia 50-50 captures the pleasures of contrasts. “It’s youthful and full of surprises”
Step I (Continued)• Existing brands tend to be clustered around
particular spots, which represent idea value-points for the customer
• Lines connecting the intersection of the 2 axes to each of these value points represents the vectors, along which brands tend to be grouped
• The perceptual map summarises the image of the customer’s mind
The Perceptual MapIdea Value Points
Step I (Continued)• At a fundamental level, the mere positioning of a
brand at a distinct point – ther further away from the competing brands the better- differentiates it
• Occupying unrealistic positions – e.g. absurdly high or low price points, can’t be translated into action nor can be a source of value
• One can innovate within and with –this framework, to get a unique value position
Positioning Getting a Unique Value Position
Step II (Continued)• When every value-spot on the mind map is
occupied, how can a new entrant use positioning as a source of added customer value?– By creating a new vector
e.g. Stanchart enteered the credit cards market
Value points on the MindmapChanging the assumptions
The Credit Card Market• Every existing price-pint was occupied with each incumbent
offering a clear value in exchange• On the scale of credit limit, one end occupied by charge cards
directed at travel and leisure customers, e.g. Diner’s and American Express
• Customers who wanted to shop on credit served by Citibank, ANZ Grindlay’s…etc.
• For the Price-exclusivity map, premium cards from AmEx and all the foreign baks – crowded the top
• Popular cards from both foreign and Indian Nationalised Banks offered plenty of choice at entry-level
Creating new vectors on the Mindmap The Stanchart Example
The Credit Card Market (Continued)..• Instead of trying to distance itself on the price –benefit
matrix on these existing scales, Stanchart created a new pricing scale altogether
• The trade off was between price and status• The low cost classic cards (100-700/- per year) offered only
the primary benefits –Credit, cash withdrawal, teledraft, add-on cards, insurance – but offered little to make their owners feel exalted
• Premium or Gold cards (1800/- -2000/- annually) with a slew of frills led to status enhancement
Creating new vectors on the Mindmap The Stanchart Example
Break the assumption of the trade-off between price and benefits
• Offered as many benefits as premium products, but at a lower price level
• Created a new slot –The Executive Class – effectively created a third ideal vector within the customer’s mind-map of existing credit cards
• Provided incremental value while differentiating from the competitors
Stanchart Positioning PloyThe Executive Class
Step II • It pays to create a brand new axis bordering the customer’s
mind-map• If so far, her perception of brands in your product category
defined by axes like, price and exclusivity or functionality and emotional satisfaction- try establishing new dimension along which the brands’ positions can be checked
In pioneering it your could immediately achieve not just the differentiation that positioning must provide, but also the value slot that you’ve been looking for
Entering a product category or repositioning an existing brand by
Creating New Reference Frames
Step II • It pays to create a brand new axis bordering the customer’s
mind-map If so far, her perception of brands in your product category defined by axes like, price and exclusivity or functionality and emotional satisfaction- try establishing new dimension along which the brands’ positions can be checked
• In pioneering it your could immediately achieve not just the differentiation that positioning must provide, but also the value slot that you’ve been looking for
e.g. United Distillary (Black & White Scotch) created a new axis “Fun” (Informality-Formality) rather than utilising the existing axis of price and tradition/ modernity
Entering a product category or repositioning an existing brand by
Creating New Reference Frames
• United Distillary (Black & White Scotch) created a new axis “Fun” (Informality-Formality) rather than utilising the existing axis of price and tradition/ modernity
• Not only distanced it from other brands clustered at the high formality end, but immediately clarified the value proposition in the customer’s perception
Entering a product category or repositioning an existing brand by
United Distillary Example
• First - must enable the customer to place the competing brands on it too – as far away from you as possible Or else thre would be no perception of qualitatively different value for the customer
• Second – the new axis must represent a quality that is a relevant source of value to the customer Thus a wine with slightest smell may be different from other brands but won’t add any customer value
The Two Things The
Mind Map Axis must do
• Why not try to extend the existing axes, climbing up on both the scales used to define the customer’s perception space about your product category
• That way, both differention and added customer value will be yours 220 crore DHL achieved this with its special service, branded “Jumbo Box” stretching out from its core documents and small parcel delivery business
On the existing mind-map
Extending The Axis
• Customer’s mind-map consisted of several commercial airlines services offering air-freight, all clustered around a particular price-convenience combination
• Combination represented sufficient value for customers not in hurry about the delivery of shipments, yet segment of Exporters wanted quick delivery of their samples – too large to be couriered – to prospective customers abroad. (wanted more value)
On the existing mind-map
Extending The Axis
• Speed was crucial to customer, DHL sensed opportunity to extend the convenience axis on mind map
• Also enlarged the price axis Knowing that the extra value would justify a price premium
• Then Positioned ‘Jumbo Box’ –enabling packages of upto 25 kg to be delivered virtually as fast as small parcels are through couriers on a higher convenience –higher price-point
• Also reinforced its value positioning - By charging a flat price which even worked out lower than airfreight in some cases
On the existing mind-map
Extending The Axis
The Diagnostic
Are you checking the customer’s perception of your brand ?
Are you trying to create a unique set of Associations for your brand ?
Are you checking whether herPerception matches your intention ?
Does your positioning provide distinctive Value to the customer?
Are you monitoring encroachment on Your positioning by your competition ?
Yes
No
Yes
No
Yes
No
Yes
No
Yes
No
• The Strategy: DHL positioned its Jumbo pack as a combination of air-freight and courier deliver
• The lesson: Import Attributes from Other Product categories
• The Strategy: United Distillers associated Black & White Scotch whisky with Fun
• The Lesson: Position your Brand along unexpected dimensions
The Lessons
• The Strategy: Stanchart Positioned its executive card as a premium product at a popular price
• The Lesson: Create New Price-Value Combinations to occupy a unique position
• The Strategy: Asian Paints positioned its Utsav brand on an emotional, not functional platform
• The Lesson: Establish relationships with several additional benefits
The Lessons