Marketing Management

Global Edition
Kotler & Keller

Chapter 8
Crafting the Brand
Positioning
 Chapter Questions

How can a firm develop & establish an effective

positioning in the market?

How do marketers identify & analyze

competition?

How are brands successfully differentiated?

What are the differences in positioning and

branding for a small business?

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 Chapter Question 1:
Marketing Strategy How can a firm develop &
establish an effective
positioning in the market?

Segmentation
Targeting
Positioning

S T P
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 Chapter Question 1:
Developing and Communicating How can a firm develop &
establish an effective
a Positioning Strategy positioning in the market?

• Positioning is the act of

designing the company’s
offering and image to
occupy a distinctive place
in the mind of the target
market.
• Result of positioning:
creation of a customer-
focused value
proposition, a strong
reason why the target
market should buy the
product.

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 Chapter Question 1:
Developing and Communicating How can a firm develop &
establish an effective
a Positioning Strategy positioning in the market?

Table 10.1 shows how three companies—Perdue, Volvo,

and Domino’s—have defined their value proposition given
their target customers, benefits, and prices.

Table 10.1: Examples of Value Propositions

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 Chapter Question 1:
Positioning decision How can a firm develop &
establish an effective
requirements positioning in the market?

Points of Parity
• Determining a frame of / Difference • Creating a brand mantra
reference by identifying to summarize the
the target market and • Identifying the optimal positioning and essence
relevant competition. points of parity and of the brand.
points of difference
brand associations given
that frame of reference.
Frame of
Brand Mantra
Reference

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 Chapter Question 2:
Competitive Frame of Reference How do marketers identify &
analyze competition?

Determine Category Membership

Which brands should

be the focus of
competitive analysis?

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 Chapter Question 2:
Identify & Analyze Competitors How do marketers identify &
analyze competition?

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 Chapter Question 3:
Identifying Optimal PODs How are brands successfully
differentiated?

Points-of-difference

Attributes or benefits consumers strongly associate with

a brand, positively evaluate, and believe they could not
find to the same extent with a competitive brand

Apple (design, ease of use, irreverent attitude)

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 Chapter Question 3:
Defining Associations How are brands successfully
differentiated?

Points-of-parity

Associations that are not necessarily unique

to the brand but may be shared with other
brands

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 Chapter Question 3:
Point-of-Difference Criteria How are brands successfully
differentiated?

Desirable

Deliverable

Differentiating

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 Chapter Question 3:
Means of Differentiation How are brands successfully
differentiated?

Employee Channel

Image Services

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 Chapter Question 3:
Brand Mantras How are brands successfully
differentiated?

Articulates the heart and soul of the brand

3-5 word phrases to capture the spirit of the
brand
Ensurepositioning
understanding to what the brand
represent with consumers to adjust actions
accordingly.
Guides what to introduce, what ad campaigns
to run, and where and how to sell the brand.
Mental filter to screen out brand-inappropriate
marketing activities
communicate what the brand is and what it is
not

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 Chapter Question 3:
Designing a Brand Mantra How are brands successfully
differentiated?

Nike – “authentic
athletic
performance” Communicate

Disney – “fun Simplify

family
entertainment”
Inspire

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 Chapter Question 3:
Constructing a How are brands successfully
Brand Positioning differentiated?

To communicate a company or brand positioning,

marketing plans often include a positioning
statement.
The statement should follow the form:

To (target group) who (need), our (Brand), is (the

concept) that (what the POD is or does)

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 Chapter Question 3:
Positioning Statement How are brands successfully
for the Apple’s iPhone differentiated?

• ‘For the <mobile user> who <needs a single

multipurpose handheld device>, the <iPhone>
provides <a phone with Internet access and a
widescreen audio/video player>. Unlike <a
BlackBerry>, the <iPhone is years ahead with an
ever-growing collection of applications for every
purpose>‘.

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 Chapter Question 3:
The template for a product How are brands successfully
positioning statement is: differentiated?

• “For the <target customer> who <statement of

need or opportunity>, the <product name or
category> provides <statement of key benefit>.
Unlike <primary competitive alternative>, the
<product> <statement of primary differentiation>.”

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 Positioning and Branding for A Small Business

Find a compelling product performance advantage.

Focus on building one or two strong brands based on

one or two key associations.
Encourage product or service trial in any way
possible

Develop cohesive digital strategy to make the brand

“bigger & better”

Create buzz and a loyal brand community

Employ a well-integrated set of brand elements

Leverage as many secondary associations as possible

Creatively conduct low-cost marketing research

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 BMW
Case Study

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 Background

BMW is the ultimate driving

machine manufactured by a
German company. BMW stands
for both performance and luxury.
The company was founded in
1916 as an aircraft-engine
manufacturer and produced
engines during World War I and
World War II. Following the war
sales dropped heavily therefore
BMW expanded into motorcycle
and automobile industry by the
mid-20th century.
Today BMW is an internationally
respected company and brand
with €53 billion in revenues in
2008.

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 BMW’s growth exploded in the
1980s and 1990s, when it
successfully targeted the growing
market of professionals who put
work first and wanted a car that
spoke of their success. The result:
sporty sedans with exceptional
performance and a brand that
stood for prestige and
achievement.
At the turn of the century,
Extensive research was conducted
to help BMW understand
consumer attitudes. Results of the
research showed that customers
cared less about the BMW brand
and instead desired a variety of
design, size, price, and style
choices.
Consequently, the company took
several steps to grow its product
line by targeting specific market
segments, which resulted in
unique premium-priced cars such
as SUVs, convertibles, roadsters,
and less expensive compact cars.
BMW’s full range of cars now
include the 1 Series, 3 Series, 5
Series, 7Series, X3
SUV, X5 SUV, X6 SUV.

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 The redesign of the 7Series, BMW’s most luxurious car, targeted a group called “upper
conservatives.” These wealthy, traditional consumers traditionally don’t like sportier cars.
Enhancements were created at a higher price to add comfort and luxury and attract
consumers away from competitors like Jaguar and Mercedes.

BMW successfully launched the 4x4 car X5 by targeting “upper liberals” who achieved
success in the 1990s and had gone on to have children and take up off-road activities such
as safaris, biking, and skiing.

These consumers needed a bigger

car for their active lifestyles and
growing families. BMW also created
the lower-priced 1 Series and X3 SUV
to target the “modern mainstream,”
a group who are also family-focused
and active but had previously
avoided BMWs because of the
premium cost.

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 BMW uses a wide range of advertising tactics to
reach each of its target markets but has kept
the tagline “The Ultimate Driving Machine” for
over 35 years. During that time, U.S. sales of
BMW vehicles have grown from15, 000 units in
1974 to approximately 250,000 in 2009.
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BMW owners are very loyal to the
brand. The company nurtures these
loyal consumers and continues to
research, innovate, and reach out
to specific segment groups year
after year.
 Questions

Briefly identify the marketing management orientation used

by BMW. Justify your answer from the case
Identify the various segmentation bases BMW used to
segment its market. Support your answer with examples
from the above case
Which targeting strategy best describes BMW’s efforts?
Support you answer.
Based on the above scenario, identify the value proposition
strategy used by BMW for its 7 series, justify your answer
Recommend at least two ways through which BMW can
increase its customers’ lifetime value
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