markman visual model chap 10 crafting the brand positioning
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Crafting the Brand Positioning:
A Visual Model (Chapter 10) Raymund C. Piñon
Marketing Management V57
VCoach Bong De Ungria
Marketing Task #4BUILDING STRONG BRANDS
Crafting the Brand Positioning
ObjectivesAt the end of this presentation, the participants should be able to
1. Understand how firms can choose and communicate an effective positioning in the market
2. See how brands are differentiated
3. Appreciate how different marketing strategies are appropriate at each stage of the product life cycle
4. Understand the implications of market evolution for marketing strategies
Outline
Developing and Communicating a Positioning Strategy Competitive Frame of Reference Points-of-Difference and Points-of-Parity
Differentiation Strategies
Product Life-Cycle Strategies
The 4th Task of Marketing is…
Developing and Communicating a Positioning Strategy
All marketing strategy is built on STP
Segmentation – discover different needs and groups in the marketplace
Targeting – identify groups it can satisfy in a superior way
Positioning – positions its offering so that the target market recognizes the firm’s distinctive offering & image
What is Positioning?Act of designing an offer and image to occupy a distinctive place in the minds of the target market
Positioning results in
The creation of a
A persuasive REASON WHY the target market should buy the product
Positioning Examples of Customer-Focused Value Propositions
Langhap Sarap Food offered by Jollibee caters to Filipino taste
Pera padala Makakarating ang padala mo
We have it all for you Convenient shopping experience in SM’s one-stop
shop because it provides all you need under one roof
World’s safest pain reliever Biogesic is safe even for pregnant women
PositioningStarts with…
A Competitive Frame of Reference
And then looks at
Points-of-Difference and Points-of-Parity
Positioning So Start with a Competitive Frame of Reference by
1st Identifying the Product’s Category Membership
Define Customer Target Market
and
Define Nature of Competition Products and services competing
for same target segment Substitute products and services
PositioningThen Looking at Points-of Differences
POD – attributes or benefits that consumers… Strongly associate with a brand
Positively evaluate
Believe are unique to the brand or could not be found to the same extent in other brands
Energizer – longest lasting battery
Louis Vuitton – most stylish handbag
McDo
Fun place for family to be togetherand for children to play
Clean pleasant modern facilities Food kids love and are affordable
Prompt friendly service
Ned Roberto (Marketing Guru) Manny Paquiao (Pambansang Kamao)
Positioningand also at Points-of-Parity
POP – attribute or benefit associations not unique to the brand but may in fact be shared with other brands
2 Types of POPs are:
Category POPs
Competitive POPs
=
PositioningCategory POPs are:
Associations essential to a legitimate and credible offering within a category
Necessary, but not sufficient, condition for brand choice
Soap must be able to clean
A doctor must have medical training and license to practice
PositioningCompetitive POPs are
Associations designed to negate a competitor’s POD
Brand “breaks even” on areas where competitors are trying to create an advantage
Consumers must believebrand is “good enough” onan attribute or benefit
xx
PositioningTo Establish Category Membership
Marketers must inform consumers of a brand’s category membership Announcing category benefits
Cherifer – tangkad sagad Enervon C - protektodo
Comparing to exemplars The Rolls Royce of the banking industry Elvis Presley of the Philippines
Relying on the product descriptor Ford Freestyle “Space Wagon” Ateneo Graduate School of Business
PositioningIn Choosing POPs and PODs, we need to consider
For PODs
Desirability Relevant and Important
Distinctive and superior
Believable, credible, compelling
Deliverability of promise Feasibility
Design and offer support desired associations
Communicability Compelling reason to believe Understandable rationale why brand can deliver desired benefits Verifiable evidence or proof points
Sustainability Preemptive Defensible Difficult to attack
PositioningIn Choosing POPs, consider
Need for category membership
Create competitive POPs to negate competitors’ PODs
PositioningMarketers must choose which level of a Brand’s POD to highlight
Attributes- Promil containstaurine
FunctionalBenefits (What a
brand does)- Promotes
Braindevelopment
Psycho-Social
EmotionalBenefits
(Self-ImageSocial Image)
- I’m a good Mom
Instrumental and
TerminalValues
- My children will love me
This?This?
This?Or this?
PositioningThe outcome of the process of creating a value proposition is a Positioning Statement
To
(Target group and need)
Children who are undernourished due to poor appetite
Our
(Brand)
Appebon
Is
(Concept)
Is a complete vitamin-mineral formulation with an appetite stimulant
That
(what the POD is or does)
Provides needed nourishment and stimulates children’s appetite because it contains 5 mg of buclizine HCl
DifferentiationTo avoid the commodity trap, we consider Competitive advantage
A company’s ability to perform in one or more ways that competitors cannot or will not match
Leverageable advantage Advantage a company can use as springboard to new
advantages
Customer advantage Competitive advantage that is seen by customer as an
advantage to themselves
DifferentiationTo derive fresh insights to differentiate our brand we can use tools such as
The Consumption Chain Examining customers’ entire experience
with a product or service to uncover opportunities to position offerings in ways no one thought possible
McMillan & McGath Questionnaire To derive consumer-based
points of differentiation
DifferentiationSome Dimensions we can use to differentiate are
Product design Swatch – colorful, fashionable watches Subway – healthy alternative to fast foods
Personnel Differentiation Better-trained employees
Channel Differentiation More effective and efficient design of
distribution channels’ coverage, expertise and performance
Image Differentiation Craft powerful, compelling images Marlboro Man
Product Life CycleDescribes an analogy of the stages of life of a product that is similar to natural biological stages of living things
Birth Slow sales growth Heavy expenditure Non-existent profits
Growth Rapid market acceptance Substantial profit improvement
Maturity Slowdown in sales growth Acceptance by most potential buyers Stabilized or decreased profits Increased competition
Decline Sales decline Profits erode
Product Life Cycle Marketing StrategiesRecall that Marketing Strategy is about STPSo examine your brand’s STP at different stages in the PLC
A company’s POSITIONING and DIFFERENTIATION strategy A company’s POSITIONING and DIFFERENTIATION strategy must change as products, markets and competitors change must change as products, markets and competitors change
over the PRODUCT LIFE CYCLEover the PRODUCT LIFE CYCLE
SWOTSWOT
SWOTSWOT
Product Life Cycle Introduction Stage Marketing Strategies
SWOT
Key Issues:• Pioneer 1st to market with new product vs. late entrant with better product• Heavy investments in product, technology, market, channel development• Market entry strategy with high risks and uncertainty
Product Life Cycle Growth Stage Marketing Strategies
SWOT
• New entrants come in with new product features and expanded distribution• Customer base expands from innovators to early adopters• Sales increase, prices remain or fall, promo expense and profits increase• Company improves product quality, adds new features and improves styling• Adds new models and flankers, enters new segments, • Increases distribution coverage and enters new channels• Shifts from product awareness advertising to product preference advertising• Lowers prices to attract next layer of price-sensitive buyers
Product Life Cycle Maturity Stage Marketing Strategies
SWOT
•Sales growth rate slows, flattens then declines• No new distribution channels, market is saturated, future growth organic• Customer starts switching to other products• New competitive forces – emerge of new categories or blue oceans• Sales decline cause overcapacity and leads to fierce competition for market shares • Price wars, increased promo spending, increased R&D spend• Exit of weaker competitors and dominance of a few large competitors: quality leader, cost leader, service leader and a few nichers
Product Life Cycle Maturity Stage Marketing Strategies
SWOT
Ways to change the course of a brand during maturity stage• Market modification - expand market:
Volume = Expand # of brand users x increase usage rate per user
• Product modification: Improve quality, features, style
• Market program modification: pricing, distribution, advertising, trade and consumer promotions, personal selling, services
Product Life Cycle Decline Stage Marketing Strategies
SWOT
• Sales decline due to technological advances, changes consumer preferences, increased domestic and foreign competition• Industry overcapacity, price cuts, profit erosion• Companies exit the market, reduce products offered, withdraw smaller segments and weaker trade channels • Cut promotional budget and lower prices further• Sustain product? Modify marketing strategy? Drop product?• Harvest – maintain sales, cut costs. • Divest – Sell or liquidate?
Market EvolutionMarkets also go through life cycle stages
Latent market Diffused preference
Single-niche strategy Multiple-niche strategy Mass-market strategy
Emergence stage
Growth stage
Maturity stage Market fragmentation Market consolidation
Decline stage
Market EvolutionReview Brand’s STP at each stage of the Market’s Evolution
Firms must visualize a market’s evolutionary path as it is affected Firms must visualize a market’s evolutionary path as it is affected by new needs, technology, competitors, channels and other by new needs, technology, competitors, channels and other developments. A company’s POSITIONING and DIFFERENTIATION developments. A company’s POSITIONING and DIFFERENTIATION
strategy must change to keep pace with market developmentsstrategy must change to keep pace with market developments
SWOTSWOT
SWOTSWOT
In SummaryWe discussed…
1. How firms choose and communicate an effective positioning in the market
2. How brands are differentiated
3. How different marketing strategies are appropriate at each stage of the product life cycle
4. Implications of market evolution for marketing strategies
++
POP
++POD
==
S
T T
P P – Positioning
Crafting the Value Proposition
Points of Parity
MarketCompetition
Points of Difference
Differentiation
Product Life Cycle
Market Evolution
4th Task of Marketing?
Avoid the commodity trap
HOW???
Positioning changes w/ changing PLC and ME
Building Strong Brands!!!
PositioningStatement:
ToOurIs
That
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