Reading Marketing
Positioning and Products
This week we will discuss positioning and branding. When we talk about positioning, we are referring to how the customer thinks about the product.
• The customer wants to know the key feature that the product has separates it from all the rest.
• In other words, positioning shows the brand's meaning in the consumers mind and compares it to the meaning the consumer applies to the competitor's brands.
The position statement is an assertion that represents how the product should be perceived in the minds of the consumer.
• Compare it to the thesis statement of an essay; the thesis statement is a short sentence usually 25 to 35 words or less that sums up the entire essay.
• The positioning statement should in fact stay around 40 words and include who you are, what you do, and the value you bring to the consumer. A positioning statement for a day care might be:
o We are a preschool providing high quality care and instruction for toddlers aged two to five in the Central Pennsylvania area. Our teachers are pre-K certified and create an individualized curriculum for each child to develop academic and social skills.
In the article "Positioning Your Product," Aaker and Shansby suggest six approaches to positioning: by attribute, price-quality, use or applications, product-user, the product-class, and the competitor (2001, p.57).
• Attribute is probably the most often-used approach; it shows the consumer the feature of the product or service that provides a benefit to the consumer.
• In the example above, the value (or benefit) the business brings to the consumer is the individualized curriculum for each child.
To create the position for company, is important to understand your target market as discussed in week two.
• What is your target market looking for?
• Is it something new, something cheaper, something more efficient?
There are times when product needs to be repositioned so that the view your target market has of the product is changed.
There are several reasons why a product might need to be repositioned.
• These include changes in the marketplace, changes the product, changes in the target market, changes in competition, changes in the location in the product life cycle, and simply time for a change.
• For example, Kentucky Fried Chicken had to respond to the changes in consumers' healthier eating habits.
o To do this they stop using the name Kentucky Fried Chicken and now go by KFC.
o They now offer healthier options to their fried chicken and mashed potatoes and this is apparent in their marketing and advertising.
Cadillac is another brand that needed to be repositioned.
o Cadillac cars used to be associated with retirement and grandparents.
o Cadillac started a new positioning towards the younger crowd by streamlining their cars and adding the Escalade SUV.
Repositioning is looking to embed a new message in the mind of the customer using one of the six approaches: by attribute, price-quality,
use or applications, product-user, the product-class, and the competitor (2001, p.57).
Knowing how to position your product also requires an understanding of the product life cycle.
There are four stages to the product life cycle: Introduction, Growth, Maturity, and Decline.
1. In the Introduction stage, the organization is developing a product for the market and building product awareness.
o Promotion is the focus of this stage and yet, here where most products fail.
In the Growth stage, the manufacturer will see sales start to increase.
o At this point, competitors are entering the market and the organization will need to spend advertising dollars to keep the brand in the mind of the consumer.
The maturity stage is when sales will begin to stabilize because the competition has increased so it is important to position (or reposition the product carefully).
The Decline stage is last--this is when sales start to drop often due to innovation.
o When the product is withdrawn from the market and retired, the cycle ends.
o How much time is spent in each stage depends on the product; for example, Doublemint gum and Barbie dolls have been in the maturity stage for decades.
o Can you think of others?
References
American Marketing Association. (2013). Definition of brand equity. Retrieved from https://www.marketingpower.com/_layouts/dictionary.aspx?dLetter=B
Branding
The American Marketing Association (AMA) defines a brand as a "name, term, sign, symbol or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of other sellers" ("Definition of Brand," 2013, para. 116)
The brand of a company is its essence, spirit, heart, and core of the business. It tells the consumer that the product or service will fulfill all expectations and promises.
• It is an integral part of the business and has to work to gain the trust of the buyers--and it does that through consistently meeting its promises.
• Think of an extremely close friend... when his or her name comes up in conversation, what is your first reaction?
o Jot down on a piece of paper the first three words that come to mind about that person.
o How did that person become a friend?
o Through consistently earning your trust?
o If the person broke a confidence or promise, would you still choose the same words to describe him or her before?
o Think of the words that you wrote down as part of the person's brand.
Brand equity is the reputation of the company; in other words, the additional money people will spend on a brand over its competition.
• According to the AMA, Brand equity is a phrase used in the marketing industry to try to describe the value of having a well-known brand name, based on the idea that the owner of a well-known brand name can generate more money from products with that brand name than from products with a less well known name, as consumers believe that a product with a well-known name is better than products with less well known names ("Definition of Brand Equity," 2013, para. 125).
For example, are you willing to pay more for Campbell's soup than the store brand? Why?
• Because of the reputation of the company that the can of Tomato soup that you open today will taste the same as the one you opened last week.
• Companies rely on their brand equity especially when releasing a new product.
• You might try the new Campbell's Squash soup because you are banking on the reputation of the company.
However, brand equity can be a problem when the brand becomes used as a noun for every item in that product category.
• Do you ask for a tissue or a Kleenex?
• Do you make a copy or a Xerox?
• Do you meet a friend for a Coke or a soda or soft drink?
These companies are still extremely successful, but their goal was to have their product stand above the rest and not be synonymous with the rest.
Brand Awareness is whether your brand pops into the consumer's mind when thinking about a product category.
• Using the examples above, what do you think of when you hear "soft drinks" or see a red can with white script?
• Or maybe you are reading with the TV on in the background and you hear the four notes of Intel.
• You know that a commercial is for a computer using the Intel brand.
The brand image represents the thoughts and feelings that consumers have when thinking about the brand.
• For example, you might equate Campbell's tomato soup and grilled cheese sandwiches with comfort food after playing in the snow.
• Or Coca-Cola with the refreshing feeling of having a cold drink on a hot afternoon.
o Coca-Cola has been extremely successful with using the brand image.
Can you assign personality or physical attributes to a product or service?
o Think back to that friend from earlier--the same personality traits and physical attributes that were evident in your friend could be applied to a product!
o For example, the Subaru crossover vehicle rugged can be described as rugged and the new Sony Ultrabooks are exciting.
References
American Marketing Association. (2013). Definition of brand. Retrieved from https://www.marketingpower.com/_layouts/dictionary.aspx?dLet