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

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Page 1: Markman visual model chap 10 crafting the brand positioning

Crafting the Brand Positioning:

A Visual Model (Chapter 10) Raymund C. Piñon

Marketing Management V57

VCoach Bong De Ungria

Page 2: Markman visual model chap 10 crafting the brand positioning

Marketing Task #4BUILDING STRONG BRANDS

Crafting the Brand Positioning

Page 3: Markman visual model chap 10 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

Page 4: Markman visual model chap 10 crafting the brand positioning

Outline

Developing and Communicating a Positioning Strategy Competitive Frame of Reference Points-of-Difference and Points-of-Parity

Differentiation Strategies

Product Life-Cycle Strategies

Page 5: Markman visual model chap 10 crafting the brand positioning

The 4th Task of Marketing is…

Page 6: Markman visual model chap 10 crafting the brand positioning

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

Page 7: Markman visual model chap 10 crafting the brand positioning

What is Positioning?Act of designing an offer and image to occupy a distinctive place in the minds of the target market

Page 8: Markman visual model chap 10 crafting the brand positioning

Positioning results in

The creation of a

A persuasive REASON WHY the target market should buy the product

Page 9: Markman visual model chap 10 crafting the brand positioning

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

Page 10: Markman visual model chap 10 crafting the brand positioning

PositioningStarts with…

A Competitive Frame of Reference

And then looks at

Points-of-Difference and Points-of-Parity

Page 11: Markman visual model chap 10 crafting the brand positioning

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

Page 12: Markman visual model chap 10 crafting the brand positioning

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

Page 13: Markman visual model chap 10 crafting the brand positioning

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)

Page 14: Markman visual model chap 10 crafting the brand positioning

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

=

Page 15: Markman visual model chap 10 crafting the brand positioning

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

Page 16: Markman visual model chap 10 crafting the brand positioning

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

Page 17: Markman visual model chap 10 crafting the brand positioning

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

Page 18: Markman visual model chap 10 crafting the brand positioning

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

Page 19: Markman visual model chap 10 crafting the brand positioning

PositioningIn Choosing POPs, consider

Need for category membership

Create competitive POPs to negate competitors’ PODs

Page 20: Markman visual model chap 10 crafting the brand positioning

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?

Page 21: Markman visual model chap 10 crafting the brand positioning

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

Page 22: Markman visual model chap 10 crafting the brand positioning

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

Page 23: Markman visual model chap 10 crafting the brand positioning

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

Page 24: Markman visual model chap 10 crafting the brand positioning

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

Page 25: Markman visual model chap 10 crafting the brand positioning

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

Page 26: Markman visual model chap 10 crafting the brand positioning

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

Page 27: Markman visual model chap 10 crafting the brand positioning

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

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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

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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

Page 30: Markman visual model chap 10 crafting the brand positioning

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

Page 31: Markman visual model chap 10 crafting the brand positioning

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?

Page 32: Markman visual model chap 10 crafting the brand positioning

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

Page 33: Markman visual model chap 10 crafting the brand positioning

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

Page 34: Markman visual model chap 10 crafting the brand positioning

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

Page 35: Markman visual model chap 10 crafting the brand positioning

++

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