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Branding & Positioning

Question:Can you "position" yourself too strongly in the market?


Ans: One of the criteria often used for judging a good positioning statement is that it is maneuverable. This ensures that the positioning doesnt lock you in, especially in markets that change. Clearly this is difficult since you want to have a strong position and that requires standing for something unique and defensible and communicating that to the market. So the answer is that in fact you can position yourself too strongly in cases where the market changes quickly. One way to avoid this, however, is to take into consideration a number of different future scenarios and see whether or not the positioning you have chosen is "robust" to these different scenarios (see our tutorial on making your marketing plan robust. If so, then your chosen positioning should work even if the market shifts and thus it's best to take a strong position

Question:What is a positioning statement?


Ans: A positioning statement is simply a formal statement depicting how you want your target segment to perceive you. In essence, then, it is a promise to the target segment that you will provide them with the benefits they care about the most. The positioning statement is less an external marketing tactic and more an internal document that helps the firm direct its marketing efforts

Question:How do I construct a positioning statement? Answer: First, use your customers' most desired benefits as the basis of the positioning statement. A positioning statement has four parts: the name of the customer segment, the most important benefits to that segment, the primary competitors (however this is not that important), and the key reasons why you can provide the customer benefits better than the competition. The most difficult part about writing a positioning statement is identifying the key reasons for differentiation from competitors. This information, of course, comes from the company analysis. The question to ask is why can your company promise these benefits better than the competition? You can't just talk about any competencies or strengths, but rather only those strengths that directly relate to the benefits desired by the customer segment. This is the essence of finding a differential advantage over the competition. If you can't write a positioning statement, perhaps you don't have the competencies called for in the last part of the statement. Likewise, if a competitor could easily match this statement, maybe this isn't a segment you should be targeting. For a positioning statement template and more details on how to construct a positioning statement, see our tutorial on the subject.

Question:What is a brand platform? Ans : A brand platform, or corporate image, is the set of associations that customers
make with your company. Some of these associations may be quite obvious and strong, like the brand Volvo is associated with safety. In other cases, the associations can be weak; BMW, for instance, may be associated with safety but only in a very weak manner. The possible associations that a brand may want to have actually comes from many sources. For example, it may come from the benefits the customers in a target market may care the most about. But it can also come from various descriptors or the self-image of the target audience. It can also come from a companys history or core competency.
Question: How do I know my company's brand platform is a good one?

Answer: A good brand platform has three characteristics. First, it is clear. That

requires a balance between abstract ideas and specific ones. Second, it requires consistency of theme and exposure. That is, once it is determined what the platform is, every communication must be consistent with that platform. Finally, a good brand platform is usually creative, cuts through the clutter and touches a nerve. This last point is the job of a good advertising company. Everything else is marketing's responsibility.

Question:

Where can I find a solid overview of branding?

Answer: Think of branding in the following digestible bites:


1. Brand Concept: A set of associations about a company or product that reside in the memory of customers. 2. Fostering the Brand Concept: Brand associations spring from various actions of the firm, including (but not limited to) advertising and general media communications. But associations also come from distribution (shelf location can convey a good product by a big seller), sales promotions (affordable), and product characteristics (including the name, packaging, and logo). Consumers' use of these brands, and information about the brands from the press, opinion leaders, and word of mouth also affect the nature of these associations. 3. Brand Extensions: A parent company or product may extend its name to a new entity. Such action, called a brand extension, succeeds only when there exists a basis of fit between the parent and the child brands.

Question:

What is a brand extension?

Answer: A brand extension occurs when a parent company or product extends its

brand name to a child company or product. For example, Starbucks Coffee extended its brand name to ice cream. A successful brand extension depends on a number of factors that you can read about in our tutorial on the subject.
What are the benefits of a brand extension?

Question:

Answer: Brand extensions let a marketer take a brand with well-known quality

perceptions and associations and put it on a brand in a new category. Not only can marketers capitalize on brand awareness, they can also leverage off of the associations consumers know about the parent brand. If consumers know that Arm and Hammer Baking Soda is deodorizing, they will immediately infer that Arm and Hammer kitty litter will be deodorizing too. Second, consumers who favorably evaluate a parent brand are more willing to try and adopt the brand extension than an unfamiliar brand in the same category. They trust a known brand name. For these reasons, brand extensions make new product introduction less expensive. Brand extensions can also help a firms stock prices. Some academic research has found that Wall Street attend to brand extension announcements and that whether they like them or not depends on how much they like the parent band. Brand extensions can also help consumers understand the core meaning of the brand name. When Arm and Hammer extends its name from baking soda to deodorant, kitty litter, shoe inserts, its core "deodorizing" brand concept is enhanced. Arm and Hammer MEANS deodorizingno matter what it is on. So, in this sense, brand extensions truly help to build equity in the brand name itself.

Question:

What are the costs to a brand extension?

Answer: There are a number of instances in which a brand extension has hurt the

image of the brand concept. This is particularly true if the brand extension involves some kind of disaster of negative publicity. When Audi had a problem with sudden acceleration in one of its models, all models with the Audi name were hurt (although the Quattroan Audi car with a different namewas not. A core brand concept can also be diluted if it is extended to too many different product categories. What does Samsung stand for if it is linked to such disparate products as life insurance, automobiles, microwave

ovens and the like? Also, a successful parent brand does not always guarantee a successful brand extension. Bic is a great brand in the context of pens and disposable razors, but perfume? Well, thats another matter altogether.

Question:

How do I decide whether or not to extend my brand to a new product?

Answer: A successful brand extension depends largely on the psychological fit

between the parent brand concept and the new product. If consumers associate the brand extension with anything undesirable, they are not likely to buy it, no matter how favorable the parent brand name is. For this reason, it is imperative that the marketer determine a good fit between the parent and the child products before putting the extension out on the market. How do you do this? First, think about the associations consumers have with the parent brand and category and think about whether these associations will work in the extension category. Heinz is associated with what, "thick" and "ketchup," "hamburgers and hotdogs," and "you can find it everywhere." These associations work well if Heinz is going to extend to a category where thickness is good and tomato flavor is desirable (e.g., Heinz spaghetti sauce), or where the usage context involves a complementary product also used with hotdogs and hamburgers (e.g., Heinz relish, hot dog buns), but may lead to less than pleasant associations if the firm extended to grape juice, a product where thickness, tomato like flavor, or meals on the grill is irrelevant or undesirable. There are many ways -- attributes, benefits, uses, users, usage situations, distribution channels, price -- that a brand extension may or may not fit with the parent brandsimilar. Each needs to be considered. And dont forget to do consumer testing. Invariably consumers will think up some associations that you didnt and that might need to be considered in developing ads. Academic research has also shown us that the affect or attitude that consumers attach to the parent brand is another big determinant of how much they like the brand extension. If they love the brand, they will likely love the extension (assuming fit, of course). If theyre not too crazy about the parent brand, chances are theyll react in a lukewarm manner to the brand extension. Research also shows us that how far away we can go from the parent brand depends on the kind of brand concept it has. Think about the differences between a brand like, say Maytag, Cross, and

Pepsi. Maytag stands for durability and reliability in washing machines. It has, what we might call, a very functional brand concept. The brand is designed to solve problems (clean our clothes) and not create new problems (by breaking down, overflowing, or ripping our clothes). Arm and Hammer, Crest, and Dell are other examples of brands with functional concepts. Cross, on the other hand, stands for prestige, style, exclusivity. It is designed to say something about the user. Hugo Boss, Rolex, and Polo Ralph Lauren are other examples. Its concept is primarily symbolic saying something about who the user is and what makes them unique or different from other consumers. Starburst stands for great tasting, gushy flavor and fun. It has an experiential concept. Disney, Pepsi, and Ben and Jerrys are other examples. If you have a functional concept, it is more difficult for you to stray from your center. Arm & Hammer might be able to extend to other functional categories, particularly those that are very central to deodorizing and cleaning, but it will never make it further than that. On the other hand, Polo might be able to extend to lots of very different categoriesshoes, clothes, eyeglasses, sheets, home appliances, and so on. Brand with functional concepts are more constraining. Finally, some research has shown that whether consumers like a brand extension and whether they think it is going to be a high quality brand depends on whether the parent category is higher or lower priced than the extension category. Say a maker of microwave ovens decides to make a toaster oven. They would be pursuing a downward price extension because the price of the brand extension category (toaster ovens) is much less expensive than the price of parent category (microwaves). If on the other hand, the same company decided to make a full sized convection oven, they would be pursing an upward price extension because the brand extension category (convection ovens) is more expensive than the parent category (microwave ovens). Consumers tend to infer that brand extensions are of higher quality and are higher priced and have higher quality when a downward vs. an upward extension are used. They also like the brand extension better (perhaps because they think its quality is better). On the other hand, a downward extension tends to hurt consumers quality image of the parent brand. It seems like consumers wonder, "why are they making a cheaper product? Maybe they arent as good as I thought they were". So if you are going to make an upward or downward price extension it seems like either the parent brand or the brand extension will be hurt. The question becomes, which do you want to hurt least? Obviously, brand extension decisions are complicated. But hopefully, they are better informed and have fewer adverse effects on the equity of the

brand if these issues are considered.

Question:

What is co-branding, and what are some examples?

Answer: Co-branding occurs when two or more brand names function together in

creating a new product. Examples of co-branding range from credit cards to cereal to automobiles: AT&T Universal Master Card Citibank/American Airlines/Visa Card Healthy Choice Cereal by Kelloggs Coach edition of the Lexus ES series Eddie Bauer edition of the Ford Explorer Water by Culligan GE Profile Refrigerator Pillsbury Brownies with Nestl Chocolate Braun/Oral-B Plaque Remover

A genuine co-branding campaign has each company that is involved consistently focused on achieving the following goals: Respond to the marketplaces expressed and latent needs. Leverage ones own core competencies. Create a new product to increase corporate revenues. Increase product salience to the consumer.

In the online world there have been fewer co-branding successes. Furthermore, many online companies think they are pursuing co-branding when in fact they are pursuing strategic partnerships. Partnerships, which have different goals than co-brands, are a way of leveraging a corporations own strengths and softening its weaknesses via a joint effort with another firm.
Question: Does every company need to brand itself and its products?

Answer: Frankly, the answer to this question depends on whether or not you want
customers to identify your product with something they will remember. Brands are nothing more than a set of associations that, if properly communicated, will result in potential customers associating a message with the product.

A good example is Intel. Prior to launching their Pentium campaign back in the early 90's, their microprocessors were known by a number and letter (e.g., 386 or x86). This meant little to most people other than numbers. The Pentium name, communicated to mean performance and compatibility, now meant something to people. Realize that the microprocessor is embedded inside a product, so now people really knew about something that literally meant nothing to them before and was invisible.

This was not the first time this had been done (Stainmaster and Teflon are other examples), but the point remains the same. A brand name can communicate something important to customers even if they can't see the product or if, in reality, the products are commodities (like bananas, cranberries, and chickens which all have been successfully branded).
Question: Does every company need to brand itself and its products?

Answer: Frankly, the answer to this question depends on whether or not you want
customers to identify your product with something they will remember. Brands are nothing more than a set of associations that, if properly communicated, will result in potential customers associating a message with the product.

A good example is Intel. Prior to launching their Pentium campaign back in the early 90's, their microprocessors were known by a number and letter (e.g., 386 or x86). This meant little to most people other than numbers. The Pentium name, communicated to mean performance and compatibility, now meant something to people. Realize that the microprocessor is embedded inside a product, so now people really knew about something that literally meant nothing to them before and was invisible. This was not the first time this had been done (Stainmaster and Teflon are other examples), but the point remains the same. A brand name can communicate something important to customers even if they can't see the product or if, in reality, the products are commodities (like bananas, cranberries, and chickens which all have been successfully branded).
Question: What dangers and advantages are brought about by branding in a global marketplace?

Answer: The advantages of branding in a global marketplace are essentially the

same as the advantages of branding in general. But the risks of global branding (where the positioning, advertising, and brand personality, name, etc. are the same in various countries) primarily lie in the areas of customer acceptance and organizational structures and processes to support the global brand. As to the first, if a common brand name is used throughout the world, it may not mean much to people in different cultures or it may even alienate people in different cultures. So companies have to take extraordinary care to make sure the brand name is chosen correctly. Advertising needs to be throught through as well since a common ad will typically not work in several countries. These are simply the cultural issues that must be fully explored before launching a global brand. But as important (and this is a point we typically bring up in case discussions in business school) is that various country managers may

oppose having a common brand name. The organizational processes may actually work against a common brand name. So, companies that want to do global branding typically have significant issues that must be resolved around incentives, structures and company processes
Question: What's the difference between a luxury brand and a prestige brand?

Answer: There really is no difference between a luxury brand and a prestige brand.
They both are brands that have associations commonly linked to prestige or luxury words (e.g., unique, fashionable, etc.). There is a difference between luxury "products" and "normal" products, and this is what you may be thinking about. Economists think of a luxury product as something that people "outspend" their income increases. This means that if your income increses by, say 10%, people will increase their spending on a luxury product at a rate greater than 10%. Marketers, on the other hand, don't define luxury that way (economists have to since they deal primarily with numbers rather than people's emotions).

Question:

What is a USP and is it different from a positioning statement?

Answer: USP stands for Unique Selling Proposition. The USP and a positioning

statement are essentially the same thing. We've seen people on some sites use this unique selling proposition (USP) as a single word, but they use it in many different ways...sometimes it's a benefit, sometimes it's just a bunch of benefits...and it can become quite confusing. We take the view that a positioning statement is cleaner and more powerful than a USP. A positioning statement is essentially what we say in the tutorial. It typically has 1-3 benefits that a segment cares about (this is where the USP is typically vague,....they never say how do you determine what these benefits are...but they come from properly segmenting the markets (based on benefits) and use these in the positioning statement. Positioning statements are also more powerful than USPs for a simple reason...if you look at the positioning statement as we have in our tutorials you'll see that it requires you to specify WHY you can provide the benefits to the customers better than the competition, thus if forces you to think about what competencies your company has that uniquely qualify you to provide these benefits. The typical USP just says find something unique, but it doesn't incorporate this additional requirement that explicitly forces you to think about competitive reactions.
Does the term "branding" mean anything more than just making the consumers aware of a brand name?

Question:

Answer: The textbook definition of branding is researching, developing, and

implementing brand names, brand marks, trade characters, and trademarks. Over the years, practitioners and academicians have elaborated on the strategic implications of branding perhaps starting with the work of David Aaker in brand equity. Since then, authors have talked about brands as assets that must be strategically managed (see, for example Scott Davis (2000) Brand Asset Management. Jossey-Bass Inc., Publishers. San Francisco, CA). Here at MarketingProfs we have plenty of articles that deal with the intricacies of branding. For example, you may want to try the following:

Question:

Whats the difference between viral and referral marketing?

Answer: Referral marketing is the art of getting people, who may not even be your
customers, to refer your product or service to other people, typically their friends or acquaintances. Viral marketing, simply put, is referral marketing over the Internet.

Question:

How do I know if my brand name is distinctive?

Answer: If your brand name doesnt create a curiosity factor, youre wasting gobs
of money just trying to cut through the communication clutter. The sooner you get psychological exclamation marks into your brand name, the sooner you get the attention you crave.

Even if you choose to have a name that means very little and can drum up a story to match it, youve got yourself a winner. Which place would you rather frequent? "One Red Dog" or "Joes Caf?" With a vivid name youve got the opportunity to weave a story--even a story that you made up all by yourself! Dont just Mona Lisa your brand. Put some Shakespeare in it as well. Push the limits of your brand name and make it an action tool. Create visual advertising, icons, logos, etc. that bring your brand name to life, and help it stand out in the crowd.

Question:

How do you manage a brand portfolio?

Answer: Managing brand images and building brand portfolios are difficult

challenges even for the most seasoned executives. This is particularly true in hard economic times when consumers are prone to forego known names to buy less expensive store brand substitutes.

Question:

How do I go about Friendship Branding?

Answer: According to Lois Geller, in "Customers for Keeps," there are 8 steps:
1. Put a human face on your company 2. Use first impressions to create a lasting friendship 3. Connect with the right customers 4. Listen to your customers 5. Share with your customers 6. Make your customers feel secure 7. Build trust between you and your customers 8. Create friendships that last; go the extra mile and offer superlative service and products.
Question: What is a brand?

Answer: This is a concept that is confusing to many people. Here is a


straightforward and simple but accurate definition: A brand is simply a set of associations That is linked to a product or company name That resides in consumers' memory That help them understand What the brand or company is Why it is potentially relevant to them How it is different or similar to other products made by the firm How it is similar or different from competitor's products

Question:

What's a tag line and how is one created?

Answer: In short (because tag lines are short :), a tagline is simply a short set of

words that companies use to associate with their company or brand...like the NY Times "All the news that's fit to print" or the Yellow Pages "Let your fingers do the walking", etc. These taglines, while clever, should also be highly relevant to your customers. So the best way to start to create one is to first figure out what segment(s) of the market you're going after, based on what these segments really care about, determine your positioning statement. Then, use the positioning statement as the basis for your tagline. For example, BMW positions itself on performance and drivability. Therefore, it's not surprising that it's tagline is "the ultimate driving machine". You can find sites on the internet that will show you hundreds of taglines,

but in almost every case, when they are good, they are based on a strong positioning statement and also have a bit of cleverness too. But cleverness alone won't do it. So start with a good positioning statement.