Crafting the Brand

Positioning and Dealing

with Competition

Key Concepts
 What is Positioning?

The act of designing the companys offering and

image to occupy a distinctive place in the minds of
the target market.

Result is the creation of a customer-focused value

proposition:
A cogent reason why the target market should buy the
product.
 Competitive Frame of
Reference

Category membershipthe products or sets of

products with which a brand competes and which
function as close substitutes.

Need to understand consumer behavior and the

consideration sets consumers use in making brand
choices.
Points-of-Parity and Points-
of-Difference
Points-of-difference (PODs) Points-of-parity (POPs)
Attributes or benefits
that consumers strongly
associate with a brand,
positively evaluate, and
believe they couldnt find
to the same extent with a
competitive brand.
Associations that
arent necessarily
unique to the brand
but may in fact be
shared with other
brands.
Category points-of-
parity
Competitive points-of-
parity
 Establishing Category
Membership
Announcing category benefits

Comparing to exemplars

Relying on the product descriptor

 Key Criteria for Points-
of-Difference
Desirability Criteria Deliverability Criteria

Relevance Feasibility

Distinctiveness Communicability

Believability Sustainability
 Differentiation
Strategies
Competitive advantagea companys ability to
perform in one or more ways that competitors cant
or wont match.

Few are sustainable, but a leverageable advantage can

be used as a springboard to new advantages.
Focus on building competitive advantages as customer
advantages.
Product Differentiation

Form Durability

Features Reliability

Customization Repairability

Performance quality Style

Conformance quality Design

Service Differentiation
Ordering ease
Delivery
Installation
Customer training
Customer consulting
Maintenance and repair
Returns
 Other Dimensions of
Differentiation
Personnel

Channel

Image
Five Forces that Determine
Marketing Attractiveness

Industry competitors

Potential entrants

Substitutes

Buyers

Suppliers
Threats Posed By These
Forces
Threat of intense segment rivalry.

Threat of new entrants.

Threat of substitute products.

Threat of buyers growing bargaining power.

Threat of suppliers growing bargaining power.

Industry and Market
Views of Competition
Industrya group of firms that offers a product or class
of products that are close substitutes for each other.
Classified by:
Number of sellers
Degree of product differentiation
Presence or absence of entry, mobility, and exit barriers
Cost structure
Degree of vertical integration
Degree of globalization
Analyzing Competitors

Strategies

Objectives

Strengths

Weaknesses
Competitor Strengths
and Weaknesses
Share of market

Share of mind

Share of heart
Selecting Competitors

Strong vs. weakmost companies aim at weak

competitors.

Close vs. distantmost companies compete with the

rivals that resemble them the most.

Good vs. badgood competitors play by

industry rules, make realistic assumptions, set
reasonable prices, and favor a healthy industry.
Competitive Strategies

Leader

Challenger

Follower

Nicher
If you are a Market Leader,
you will want to

Expand the total market

Defend market share

Expand market share

 If you are a Market Leader,
how to expand total market?

Market-penetration strategy

New-market segment strategy

Geographical-expansion strategy
If you are a Market Leader, how
to defend your market share

Position defense
Flank defense
Preemptive defense
Counteroffensive defense
Mobile defense
Contraction defense
If you are a Market Leader, how
to expand your market share

Factors to consider before pursuing:

The possibility of provoking antitrust action

Economic cost
Pursuing the wrong marketing activities
The effect of increased market share on actual and
perceived quality
 Other Competitive
Strategies
Market-challenger strategies

Market-follower strategies

Market-nicher strategies
 Market-Challengers
Strategies
Define the strategic objective and opponents.

Decide who to attack:

Market leader
Market equals that are underperforming
Small local and regional firms
 Market Challengers
Attack Strategies
Frontal attack

Flank attack

Encirclement attack

Bypass attack

Guerilla warfare
 Market-Followers
Strategies
Counterfeiter

Cloner

Imitator

Adapter
Specialized Niche Roles
End-user Product-feature

Vertical-level Job-shop

Customer-size Quality-price

Specific-customer Service

Geographical Channel

Product or product-line
 Balancing Customer and
Competitor Orientations

Competitor-centered company Customer-centered company

Looks at what competitors Focuses more on customer

are doing and then developments in
formulates competitive formulating its strategies.
reactions.