Marketing Management

By Philip, Kevin Lane Keller, Abraham Koshy, Mithileshwar Jha

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SUMMARY by

Chapter

11

Crafting the Brand Positioning

This chapter illustrates how a firm can choose an effective positioning in the market and differentiate its brand. It describes the various strategies a firm can employ at each stage of a products life cycle and finally shows the implications of Market evolution for marketing

Positioning:
Positioning is the act of designing the companys offering and image to occupy a distinctive place in the minds of the target market. Positioning requires determining on a frame of reference based on the following factors:

strategies.

Developing and Communicating a Positioning Strategy

Category Membership:
products or set of products with which the brand competes and which function as close substitutes.

Points of Difference (POD):

in another brand.

Attributes or benefits consumers strongly

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

Points of Parity (POP): They are associations that are not unique to the brand
but in fact maybe shared with other brands. It has two forms: Category Points of Parity: Associations customers view as essential to a legitimate and credible offering within a certain product or service category. Competitive Points of Parity: Associations designed to negate a competitors pointsof-difference.

1. Identifying the target market. 2. Analyzing the competition.

Choosing POPs and PODs

POPs: They are driven by the needs of category membership (to create category POPs) and the necessity of negating competitors PODs (to create competitive PODs) PODs: The following two criteria are considered while choosing POPs Desirability Criteria Relevance Distinctiveness Believability Deliverability Criteria Feasibility Communicability Sustainability

Chapter 11 - Crafting the Brand Positioning Establishing category membership

The typical approach to positioning is to inform consumers about a brands category membership before stating its points of difference. Initial advertising often concentrates on create brand awareness and subsequent advertising attempts to craft the Brand Image. Differentiating Strategies

Competitive Advantages
It is a companys ability to perform in 1 or more ways that competitors cant match. Two

Straddle Positing:
It is a common positioning technique used when a company tries to straddle between two frames of reference. E.g. BMW through a well crafted marketing program straddled Luxury and Performance as both POD and POP.

sustainable competitive advantages are: Leverageable Advantage: is one that a company can use as a springboard to new advantages Customer Advantage: is an advantage that a customer sees in the companys offering

Dimensions to differentiate Market Offerings

Personnel differentiation: Better trained employees E.g. smartly dresses flight attendants of Kingfisher Airlines. Channel Differentiation: more effectively and efficiently designed channels, coverage, expertise and performance. Image differentiation: Companies can craft powerful compelling images. E.g. Marlboros macho cowboy image.

Product Lifestyle Marketing Strategies

Most product life-cycle curves are portrayed as bell shaped curves.

A companys positioning and differentiation strategy must change as the product, market and competitors change over the product life cycle (PLC).

Chapter 11 - Crafting the Brand Positioning Trends Summary of Product Lifecycle Characteristics, Objectives and Strategies
Introduction Characteristics Sales Low Sales High Cost per customer Negative Innovators Growth Rapidly rising sales Maturity Peak Sales Decline Declining Sales Low cost per customer Declining Profits Laggards

Maturity:
When the

Costs Profits

Average Cost per Low cost per customer customer Rising Profits Early Adopters High Profits Middle majority

competitors cover all Customers major segments of Marketing the market maturity stage occurs. Competitors invade each others profits slows down, market splits into finer segments and market segmentation occurs. This is often followed by market consolidation caused by the emergence of a new attribute that has greater appeal. Mature markets swing between fragmentation and consolidation.
Advertising Distribution Price Strategies Objectives

Create product awareness and trial Offer a basic product

Maximize market Maximize profit while defending share market share

Reduce expenditure and milk the brand

and as market growth Product

Offer product Diversify brands Phase out weak extensions, and items models products service, warranty

Charge cost-plus Price to penetrate Price to match or Cut price market best competitors Build selective distribution Build product awareness among early adopters Build Intensive distribution Build awareness and interest in mass market Build more intensive distribution Stress brand differences and benefits Go selective: phase out unprofitable outlets Reduce to level needed to retain hard-core loyals Reduce to minimum level

Sales Promotion Use heavy sales Reduce to take Increase to promotion to advantage of encourage brand heavy consumer switching entice trial demand

Market Evolution
Emergence: Before a market materializes it exists as a latent market. Here the entrepreneur has three options: 1. Single Niche Strategy: Design a product to meet preferences of 1 segment of the market 2. Multiple-Niche Strategy: Launch 2 or more products simultaneously to capture 2 or more parts of the market 3. Mass Market Strategy: Design a product for the middle of the Market 1. 2. Maturity Decline: Eventually demand for the current products will begin to decrease because either: Societys total need level declines New Technology replaces the old