chapter 7 Flashcards
positioning
the act of designing a company’s offering and image to occupy a distinctive place in the minds of the target market. the goal is to locate the brand in the minds of customers to maximise the potential benefit to the firm. it requires that marketers define and communicate similarities and differences between their brand and its competitors. deciding on a positioning involves three steps.
value proposition
a clear reason why the target market should buy a product or service.
competitive frame of reference
defines which other brands a brand competes with, and which should thus be the focus of competitive analysis. information about competitors’ real and perceived strengths and weaknesses is necessary to formally define this.
category membership
refers to the products or sets of products with which a brand competes and that function as close substitutes. this is a good starting point in defining a competitive frame of reference.
industry
a group of firms offering a product or class of products that are close substitutes for one another.
competitors
companies that satisfy the same customer need.
marketing myopia
happens when marketers define competition in traditional category and industry terms, rather than considering customers’ needs.
share of market
the competitor’s share of the target market.
share of mind
the percentage of customers who named the competitor in responding to the statement ‘name the first company that comes to mind in this industry’.
share of heart
the percentage of customers who named the competitor in responding to the statement ‘name the company from which you would prefer to buy the product’.
points-of-difference (PODs)
attributes or benefits that consumers strongly associate with a brand, positively evaluate, and believe they could not find to the same extent with a competitive brand. three criteria: desirable to consumer, deliverable by the company, and differentiating from competitors.
points-of-parity (POPs)
attribute or benefit associations that are not necessarily unique to the brand but may in fact be shared with other brands. there are three basic forms: category, correlational, and competitive.
straddle positioning
when a company is able to straddle two frames of reference with one set of PODs and POPs. the POD for one category will become the POD for the other and vice versa. they allow brands to expand their market coverage and potential customer base. however, if POPs and PODs are not credible, the brand may not be viewed as a legitimate player in either category.
competitive advantage
a company’s ability to perform in one or more ways that competitors cannot or will not match.
perceptual maps
visual representations of consumer perceptions and preferences. they provide quantitative pictures of market situations and the way consumers view different products, services, and brands along various dimensions. many marketing experts believe that a brand positioning should contain POPs and PODs that appeal to both the head and the heart.
brand mantra
3 to 5-word articulation of the heart and soul of the brand, closely related to other branding concepts like “brand essence” and “core brand promise”. brand mantras create a mental filter to screen out brand-inappropriate marketing activities or actions of any type that may have a negative bearing on customers’ perceptions. they must economically communicate what the brand is and what it is not. criteria: communicate, simplify, and inspire.
brand positioning
helpful schematic in which marketers communicate the brand positioning strategy to everyone in the organisation.
main ways to convey a brand’s category membership
- announcing category benefits
- comparing to exemplar
- relying on the product descriptor
addressing attribute or benefit trade-offs
marketers can:
1. launch two different marketing campaigns.
2. link the brand to a person, place, or thing that possesses the right kind of equity to establish an attribute as POP or POD.
3. convince consumers that the negative relationship, if considered differently, is in fact positive.
narrative branding
based on deep metaphors that connect to people’s memories, associations, and stories. elements:
1. brand story in terms of words and metaphors.
2. consumer journey or the way consumers engage with the brand and touch points.
3. visual language or expression for the brand.
4. the manner in which the narrative is expressed experientially, or the brand engages the senses.
5. the role the brand plays in the lives of consumers.
cultural branding
in order to build a strong position for a brand, the company has to use cultural knowledge strategies according to cultural branding principles and hire and train cultural experts.
searching for new customers
companies search for new customers among three groups:
1. market penetration strategy: those who might use it but do not.
2. new market segment theory strategy: those who have never used it.
3. geographical expansion strategy: those who live elsewhere.
continuous innovation
the front-runner should lead the industry in developing new products and customer services, distribution effectiveness, and cost cutting.
responsive marketing
finds a stated need and fills it.
anticipative marketing
looks ahead to needs customers may have in the near future.
creative marketing
discovers solutions customers did not ask for but to which they enthusiastically respond. creative marketers are proactive market-driving firms, not just market-driven ones.
aim of defensive strategy
reduce the probability of attack, divert attacks to less-threatened areas, and lessen their intensity.
position defence
occupying the most desirable position in customers’ minds, making the brand almost impregnable.
flank defence
the market leader should erect outposts to protect a weak front or support a possible counterattack.
preemptive defence
a more aggressive maneuver is to attack first, perhaps with guerrilla action across the market, and keeping everyone off balance. another preemptive defence is to introduce a stream of new products and announce them in advance.
counteroffensive defence
the market leader can meet the attacker frontally and hit its flank or launch a pincer movement, so the attacker will have to pull back to defend itself. another form is the exercise of economic or political clout. the leader may try to crush a competitor by subsidising lower prices for a vulnerable product with revenue from its more profitable products, or it may lobby legislators to take political action to inhibit competition.
mobile defence
the leader stretches its domain over new territories through markets broadening and market diversification.
market broadening
shifts the company’s focus from the current product to the underlying generic need, the way “petroleum” companies recast themselves as “energy companies”.
market diversification
shifts the company’s focus into unrelated industries.
contraction defence
no longer defend all territory. companies give up weaker markets and reassign resources to stronger ones (planned contraction).
factors to consider before buying higher market share
- the possibility of provoking antitrust action.
- economic cost
- danger of pursuing the wrong marketing activities.
- the effect of increased market shares on actual and perceived quality.
market challengers
companies that try to attack the leader and other competitors in aggressive bid for further market share.
market followers
companies who do not try to “rock the boat”.
frontal attack
attacker matches its opponent’s product, advertising, price, and distribution.
flank attack
identifying shifts that cause gaps to develop in the market, then rushing to fill the gaps.
encirclement attack
attempts to capture a wide slice of territory by launching a grand offensive on several fronts.
bypass attack
bypassing the enemy altogether to attack easier markets instead. offers three lines of approach: (1) diversifying into unrelated products (2) diversifying into new geographical markets (3) leapfrogging into new technologies.
guerrilla attack
consists of small, intermittent attacks, conventional and unconventional including selective price cuts, intense promotional blitzes, and occasional legal action to harass the opponent and eventually secure a permanent foothold.
cloner
emulates the leader’s products, name, and packaging with slight variations. it is a market-follower strategy.
imitator
copies some things from the leader but differentiates on packaging, advertising, pricing, or location. it is a market-follower strategy.
adapter
takes the leader’s products and adapt or improves them. it is a market-follower strategy.
multiple niching
can be preferable to single niching because strength in two or more niches increases the chances for survival.
