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Category: Brand Differentiation

Brand Differentiation

The End Of The Unique Selling Proposition?

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Unique Selling Proposition

When Rosser Reeves first proposed the Unique Selling Proposition many decades ago now, the world was a very different place. Products still had the potential to actually be different, advertising was largely confined to mainstream channels and brands were, for the most part, identifiers. But with the evolution of best-practice manufacturing, the fragmentation of channels and the increasing development of brands as monikers for consumer lifestyle, I can’t help wondering whether the USP is now redundant.

Clearly I’m not the only person whose had thoughts along these lines. In a lengthy and detailed post, Paul Simister summarizes and evaluates the arguments he’s seen advanced by others to replace the USP. Among the suggestions:

  • A short statement to differentiate your business based on what you stand against.
  • USPs don’t exist in markets where the businesses are more interested in copying each other than in being different.
  • Create a Unique Story Proposition that focuses on what matters to the customer and what matters to you

Ironically as the performance pressures on CMOs mount, the onus to achieve differentiation, given the evolution of market dynamics and economics, has never been greater … or harder. I think though that we must now assume that any product that shows any level of distinction will in time be caught, matched and even surpassed by its rivals. So the future doesn’t lie in fashioning competitor-proof products. Nor does it lie in fashioning slogans that capture people’s imagination. It seems to me that too many people are trying to evolve an outdated formula to a landscape that bears no resemblance to the context within which it was fashioned.

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Brand Differentiation

Questioning The Quest For Brand Differentiation

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Brand Differentiation Strategy

For some time now, brands have pursued difference. Spurred on initially by Jack Trout, they’ve positioned, disrupted, innovated…all with that elusive goal in mind. To stand out and stand apart from their competitors. Benefits, positioning, pyramids, strategies…a lot of time and energy has gone into trying to help brands achieve difference. Everyone’s been on that quest to become a Purple Cow.

Don’t get me wrong. I’m a Seth Godin fan and, inspired by that, the call for differentiation has been a recurrent theme in my own work, but there’s no denying that for the most part marketers have failed to live up to Godin’s call to recolor the livestock. Nigel Hollis has written previously here on Branding Strategy Insider that less than 1 in 5 brands is seen as distinctive by consumers.

One can of course read that as proof that Godin’s call is as relevant (and challenging) as ever. Or one can take it as meaning that the quest for difference is simply not one that works for the majority of marketers.

Three reasons why remarkable difference might be unattainable:

  • Marketers get tempted into pursuing difference for difference’s sake and take their eye off the very people who buy their brands.
  • Difference isn’t a motivation for consumers. People don’t go to the supermarket to buy what’s different. They buy what they know and what appeals to them. They buy what they remember. Different or not.
  • In a world of product parity, increasing regulation, impatient investors and embedded management orthodoxy, meaningful difference is too hard to achieve. Consider this characteristically provocative statement from Mark Ritson: “[True] repositioning is almost always impossible. No matter how attractive it appears or how commonly we use the term in marketing, the actual business of changing a brand’s DNA and being successful is ridiculous…actually changing a brand from black to white…is a ludicrous notion. Even when you can fool the people into believing the change has occurred…you cannot change the fundamental nature of the way a brand does business.”

So what’s the alternative? Conformity? Hardly. Perhaps a little more latitude – and more focus on the human condition.

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Brand Differentiation

7 Strategies To Create New Business Categories

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I have written about creating “category-of-one” brands before. Most brands spend their time trying to increase their share of existing markets. They pursue many different tactics to do so, from innovating new product functions and features and offering price promotions (which erodes brand equity) to improving product quality and creating value-added services. Some even create highly entertaining ads hoping this will help them break through the category messaging clutter. The problem with these approaches is that they are incremental and most of them can be very easily matched by the competition.

Brand managers know how difficult it can be to create brand differentiation within an existing category. In mature markets, every market position has already been taken. True breakthroughs come only from creating entirely new categories, highly compelling new categories.

So, how does a brand manager achieve this?

  1. Break customer compromises. In the Harvard Business Review article “Breaking Compromises, Breakaway Growth”, CarMax is a good example of a company that methodically broke the compromises that brands in the used car buyer category routinely made with their customers. Amazon.com broke compromises as well and created the first global megastore open 24/7.
  2. Redefine the category in a radically new way. In the book Blue Ocean Strategy Cirque du Soleil is an example of a brand that created a new category of entertainment. It falls into the “circus” category, but this brand has skillfully crafted a highly valued and differentiated positioning as everything a circus is not. There are no tents, tigers and elephants. No ringmasters. Instead it borrows attributes from other entertainment categories like, dance, music, opera and theater. It becomes something all together different–far outside the bounds of a conventional circus.
  3. In an industry defined by functional categories, redefine your space by customer end benefits. My Alma Mater, Rensselaer Polytechnic Institute, chose to redefine itself from a technological university (or engineering school) to a place where people could go to change the world through technological innovation (why not change the world?®). Similarly, Paul Smith’s College did this by refocusing on the end benefit of being THE college that allows one to live and play in the six million acre Adirondack Park while receiving a college education (The College of the Adirondacks ®).
  4. Create an entirely new category, enabled by technological breakthroughs. The Internet enabled eBay to create more efficient markets through a global online auction platform. Apple ushered in the smart phone category with the iPhone.
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Brand Differentiation

50 Ways To Differentiate Your Brand

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Everybody wants a brand that’s different. The irony of that statement is intentional. It belies the conservative manner in which most brands approach competitive difference. They say they want to be distinctive to consumers but often, in their heart of hearts, they actually want to align (read conform) with the rest of the industry. One of the key issues for that is an uncertainty on the part of brand makers and decision makers to find a starting point.

In some ways that’s actually less difficult and daunting than it first appears. Begin with a premise that is truly one degree away from your rivals. By logically progressing that premise over time, and with strong discipline, you will build a brand that is consistently and markedly different.

Here’s 50 ways you can create a meaningful difference for your brand:

  1. Go slow in a world of speed. Each Rolex takes a year to manufacture. The perception that a longer process is needed to build the world’s best timepiece also reinforces the value.
  2. Use country of origin to your advantage. Brands from Switzerland are highly associated with precision and fine craftsmanship. Seek to build brand associations with countries that support your reputation for service, manufacturing, innovation etc.
  3. Behave differently. Online shoe retailer Zappos has built its advantage on an iron clad return policy and customer service that goes above and beyond, breaking down the perceived barriers of selling and buying shoes online.
  4. Look different. Apple always looks like Apple. Diesel always looks like Diesel. Absolut Vodka always looks like Absolut. They’re in a sector but they don’t look like part of the sector.
  5. Be the underdog in a sector where everyone else wants to be top dog. Nantucket Nectars started “with only a blender and a dream,” and Clif Bar proclaims that its founder once lived in a garage. Underdogs win the compassionate consumer. Look for the underdog story you can tell.
  6. Be truly and unapologetically shocking. Benetton’s “Unhate” campaign ruffled feathers on almost every front. But – and this is critical – the outrage you generate must link to a solution and that solution should be your front. Otherwise, you simply risk shouting into the wind.
  7. Expand your appeal. “Discover” an untapped audience in your sector and, by drawing them in, intensify the sense of community around your brand and the interaction that people have with the brand. Enterprise Rent-A-Car did just that by offering leasing at a time when competitors did not. By serving this unmet need with attention to customer experience, Enterprise became the world’s number 1 car rental company. Apple too saw what others did not. No one was asking for an iPhone, but an untapped audience emerged when new value in the form of a cell phone was introduced.
  8. (Re)Invent a category – and own it. UFC became the fastest growing sports organization in the world by redefining the reach and the audience for mixed martial arts. Today, UFC produces more than 30 live events annually and is the largest pay-per-view event provider in the world. Swatch differentiated from other watch brands by focusing on self-expression rather than precision.
  9. Create a new category. The Toyota Prius, the Nintendo Wii, and Red Bull are all brands that created new categories, outside the established norms of their product category. By stepping outside the bounds of their categories, these brands created a space that they can call their own.
  10. Tell a story that defines you and is unique to you. The story may be about your founder as in the case with Virgin and Richard Branson, your heritage like Hickory Farms or the value you bring to the world like Coca-Cola’s Open Happiness. It may also be based in imagination – like the thought that Keebler elves make Keebler cookies. Or perhaps it’s a story based on your highly guarded secret – only two people in the world know Coca-Cola’s formula. Your story may also be about the source of your product, service or inspiration.
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Brand Differentiation

Is Your Brand Destined For Sameness?

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It is an indisputable fact that purchasing in product and service categories obeys the law of Double Jeopardy. This is – stated at its most simplistic – an empirical generalization that higher market share brands achieve stronger customer loyalty than lower market share brands in the same category. But the thing that always intrigues me is whether all brands obey the Double Jeopardy law to the same degree all of the time.

Take pretty much any data set at a point in time and plot brands on a graph comparing a penetration metric with a loyalty metric, and you will find a consistent relationship between the two; the higher a brand’s penetration the higher the loyalty. The metrics could be awareness and claimed trial, familiarity and favorable brand attitudes or actual penetration and repeat purchase, and the pattern will be there and favor the bigger brands. The obvious conclusion to be drawn from Double Jeopardy is that to grow market share, a brand must first grow its customer base.

But Double Jeopardy only holds if brands are broadly substitutable and appeal to the same target audience. And having spent more time than I care to think about looking at brand scatter plots like the one described above, I have noticed that some brands manage to break away from the category relationship. A few appear to do so on a consistent basis, and others do so only temporarily. Brands that manage to achieve a higher loyalty than is predicted by the category relationship tend also to be the ones that have managed to innovate, and create a perception of meaningful differentiation versus the competition. The ones that fall short tend to be premium brands that have lost their differentiation.

This observation makes me wonder if over time brands tend to revert to the category mean. In other words, from time-to-time brands find a way to innovate – either tangibly or intangibly – creating meaningful differentiation that allows them to command more loyalty than their size would normally dictate. But competitive pressures then erode that advantage, returning the brand to the category norm.

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