Brand trust resides in different places in different markets. The location and nature of that trust should directly influence how you compete.
Category – in highly regarded categories, such as the NGO (Non Governmental Organization) sector, most if not all brands are trusted and seen as reputable. It’s hard to gain distinction in such circumstances because all/the vast majority of participants are viewed as ethical, and therefore there is little or no reputational distinction. Equally, if you are part of a sector with a bad reputation, it’s very hard to break away from the overwhelming stigma that membership in that category brings with it. In some markets, you are still pushing stuff uphill if you seriously believe you can be a trusted financial institution.
If you wish to put distance between yourself and others in a category where everyone/no-one is trusted, you have two opportunities: the first is to look for ways to disrupt the category (relatively easy in categories that are renowned for being slow, conservative or arrogant); the alternative is that you position and compete in a manner that is closer to the dynamics of a different (and often unrelated) category. Interesting things can happen when you apply the rules of one part of the market to another.
Product – in markets where one or more brands are seen as the leaders because of the products they offer, the products themselves are often viewed as interchangeable from a trust perspective. To counter this, some brands have looked to build strong and integrated ecosystems around their offerings that ensure they (only) work best when they are used together. Nevertheless, maintaining loyalty in such competitive environments is difficult. Players often get pulled into upgrade, feature or price wars in increasingly desperate attempts to out-pace and under-price their competitors. Such squabbles use up immense energy and resources and frequently do little to shift the dial in terms of overall reputation or loyalty. Inevitably, the other player(s) catch(es) up, and the cycle starts again.
Short answer – yes it is, but not in the way it was.
I haven’t met a brand manager yet who didn’t tell me that they had a differentiated product. I’m not surprised. It’s part of the job description of any brand owner to be marketing something that is disruptive, market-changing, blue-ocean, category-killing…15 years on from when I first suggested “parity is the real pariah”, every brand’s still talking up difference – but consumers are increasingly hard pressed to see any.
In some ways, marketers only have themselves to blame. Enthused by the need to be so very different from everyone else, marketers seem to have searched, then compromised and finally settled for nit-picking their way to a self-appointed category-of-one. Is it time to call time? Perhaps if more brands admitted that the chances of them redefining the universe at a product or service level were nil, they could focus more on the things that do matter.
We’ve been drawn into the innovation myth – the belief that brands can invent their way to market dominance. Most brands will never do that. At best, “innovation” (which would better be described across the majority of the market as improvement) will keep them on a par with those around them. At worst, it will lure them into risking massive resources for a difference they will never make.
So let’s talk about a shift of focus: from big picture, broad brush disruptive market plays to a new era of personalized, specific, individualized small plays. In the new world of the quantified self and the emerging Internet Of Everything, brand differentiation today is really about what a brand does for “me” not how it revolutionizes whole swathes of a sector.
Branding Strategy Insider helps marketing oriented leaders and professionals like you build strong brands. BSI readers know, we regularly answer questions from marketers everywhere. Today we hear from Anna, a Product Manager in Stockholm, Sweden who writes…
“I have recently become the product manager of a pharmaceutical product. This product is 1 out of 8 in the Nordic market. All products but one are original. The biosimilar product markets itself on price, however due to very aggressive marketing they have been taking the market by storm. The product category is old, tried and tested and all substances are pretty much exactly the same. The differentiation is in the administration device. Two products have clear product advantages (in the administration device) that are of real value for the patient. Mine doesn’t. In fact there is nothing of value that my product has that no one else hasn’t. Our price is OK but my team is struggling to convince the doctors to use it when better alternatives are available. We currently have about 5% of the market and I am failing to reach my year-end target. I have 5 months left to change strategy, inspire my sales team and turn this around. If I do, I will be the first one to ever bring us above 5% market share.
To add to the challenge the previous PM had somewhat of a cluttered style. I have cleaned up the messaging to focus on the only thing that I can see sets us apart, our product was the first of its kind on the market (however we are marketing it under a license from the company that invented it). Furthermore, we have been ordered from HQ to have a short term approach in our marketing and my budget is small. At the moment the bulk of the budget is spent on conferences and educational events for the doctors. A price only strategy is not an option since we could never compete on price in the long term.”
Thanks for your question, Anna. Many brands share your brand’s dilemma. The product itself is a commodity. That is, it is undifferentiated from competitive alternatives. First, I would direct you to our blog posts on branding commodities. They list a number of general approaches for differentiating commodities.
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.
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.