1. Crafting the Brand Positioning
MARKETING MANAGEMENT
Crafting the Brand Positioning  

2. Marketing Strategy
Segmentation
Targeting
*Positioning*

3. Chapter Questions
How can a firm choose and communicate an effective positioning in the market?
How are brands differentiated?
What marketing strategies are appropriate at each stage of the product life cycle?
What are the implications of market evolution for marketing strategies?

4. Developing and Communicating a Positioning Strategy
Positioning: The act of designing the company’s offering and image to occupy a distinctive place in the mind of the target market.
Value proposition: a cogent reason why the target market should buy the product.

5. Positioning for Competitive Advantage
Market positioning: Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products, In the minds of target consumers,
Formulating competitive positioning for a product, and creating a detailed marketing mix
Marketers must:
Plan positions to give products the greatest advantage
Develop marketing mixes to create planned positions typically defined by consumers on the basis of important attributes.
Involves & implanting the brand’s unique benefits and differentiation in the customer’s mind.

6. Value Propositions Perdue Chicken
More tender golden chicken at a moderate premium price
Domino’s
A good hot pizza, delivered to your door within 30 minutes of ordering, at a moderate price

7. Examples of Value Propositions
Company and Product
Target Customers
Diff. Benefits
Price
Value Proposition
Perdue (chicken)
Quality-conscious consumers of chicken
Tenderness
10% premium
More tender golden chicken at a moderate premium price
Volvo
(station wagon)
Safety-conscious “upscale” families
Durability and safety
20% premium
The safest, most durable wagon in which your family can ride
Domino’s (pizza)
Convenience-minded pizza lovers
Delivery speed and good quality
15% premium
A good hot pizza, delivered to your door door within 30 minutes of ordering, at a moderate price

8. Positioning: example

9. Writing a Positioning Statement
Positioning statement format: “To (target market and need) our (brand) is (concept) that (point of difference)”

10. Writing a Positioning Statement
Mountain Dew: “To young, active
soft-drink consumers who have
little time for sleep, Mountain Dew
is the soft drink that gives you
more energy than any other brand
because it has the
highest level of caffeine.”?? (
fun, exhilaration, energy)

11. Communicating and Delivering the Chosen Position
Company must take strong steps to deliver and communicate the desired position to target consumers.
The marketing mix efforts must support the positioning strategy.
Must monitor and adapt the position over time to match changes in consumer needs and competitors’ strategies.

12. Positioning Errors Under positioning:
Failing to really position the brand at all (vague idea)
Over positioning:
Giving buyers too narrow image of the brand.
Confused Positioning:
Leaving buyers with a confused image of the company.

13. Differentiation
Differentiation: the process of adding a set of meaningful and valued differences to distinguish a company’s offering from competitors’ offerings.
Differentiation strategies:
Product
Services
Personnel
Channel
Image

14. 2. Consumer Goods Classifications
Classified by shopping habits
 Convenience goods
 Shopping goods
 Specialty goods
 Unsought goods

15. 2. Consumer Goods Classification
2.1 Convenience goods :
 Staples Goods:
Goods consumers purchase on a regular basis (Toothpast).
 Impulse Goods:
Purchased without any planning or search efforts (Magazines).
 Emergency Goods:
Are purchased when a need is urgent (umbrellas during a rainstorm).

16. 2. Consumer Goods Classification
2.2 Shopping goods :
The bases are the suitability quality, price and style
 Homogeneous shopping goods:
Are similar quality but different enough in price to justify shopping
comparisons.
 Heterogeneous shopping goods:
Offer in product features & services that maybe more important than
price.

17. Shopping Goods Convenience Goods
Comparative Between Convenience & Shopping Goods
Shopping Goods
Convenience Goods
Limit Distribution
Convenience Distribution
High Price
Reasonable Price
Low life cycle
High life cycle
Needs planning or search efforts
Purchased without planning or search efforts
Selective distribution policy
Intensive distribution policy

18. Product Differentiation
Many products can be differentiated in form (Size, shape, physical structure of a product.
Form
The company should consider how many people want each feature, how much it would take to introduce each feature, and think of feature bundles or packages.
Feature
Performance quality
Most products are established at one of four performance levels: Low, average, high or superior.
A measure of the product's expected operating life under natural or stressful conditions, is a valued attribute for certain products.
Durability

19. Product Differentiation
Measure of the probability that a product will not fail within a specified time period.
Reliability
Style
Describe the product's look and feel to the buyer.
Conformance Quality
Is the degree to which all the produced units are identical and meet the promised specifications
Is a measure of the ease of fixing a product when it malfunction or fails.
Repairability

20. Services Differentiation:
Ordering ease: refers to how easy it is for the customer to place an order with the company.
Delivery: to how well the product or service is delivered to the customer.
Installation: refers to the work done to make a product operational in its planned location.

21. Services Differentiation:
Customer training: refers to training the customer’s employees to use the vendor’s equipment properly and efficiently.
Customer consulting: refers to data, information systems, and advice services that the seller offers to buyers.
Maintenance & repair: describes the service program for helping customers keep purchased products in good working order.

22. Brand Decision The AMA definition of a brand:
“A name, term, sign, symbol, or design, or a combination of these, intended to identify the goods or services of one seller or group of sellers and to differentiate them from the competition.”

23. Packaging and Labeling
Is all the activities of designing and producing the container for a product.

24. Packaging includes: The primary package The secondary package
The shipping package
Packaging has become as marketing tool, well designed packages can create convenience & promotional value.

25. Labeling
The label may be a simple tag attached to the product or an elaborately designed graphic that is part of the package.

26. Labeling functions:
 Identifies the product or brand
 May identify product grade
 May describe the product
 May promote the product
Legal restrictions impact packaging for many products.

27. Warranties & guarantees
are formal statements of expected product performance by the manufacturer.
Guarantees are most effective in two situations:
The company or the product is not well know.
The product's quality is superior to the
competition.

28. Warranties and guarantiees
Guarantees
1- Reduce the buyer perceived risk.
2- Suggest that the product is of high quality.
3- Company and its service performance are dependable.
4- Enables the company to charge a higher price than a competitor who is not offering an equivalent guarantee.

29. Defining Associations
Points-of-parity
(POPs)
Associations that are not necessarily unique to the brand but may be shared with other brands
Points-of-difference (PODs)
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

30. Conveying Category Membership
Announcing category benefits
Comparing to exemplars
Relying on the product descriptor

31. Consumer Desirability Criteria for PODs
Relevance
Distinctiveness
Believability

32. Deliverability Criteria for PODs
Feasibility
Communicability
Sustainability

33. Examples of Negatively Correlated Attributes and Benefits
Low-price vs. High quality
Taste vs. Low calories
Nutritious vs. Good tasting
Efficacious vs. Mild
Powerful vs. Safe
Strong vs. Refined
Ubiquitous vs. Exclusive
Varied vs. Simple

34. Addressing negatively correlated PODs and POPs
Present separately
Leverage equity of another entity
Redefine the relationship

35. Adding further differentiation
Promoting Differences
This CTR relates to the material on pp
Discussion Note: The key to selecting the right competitive advantage is to develop a unique selling proposition (USP) for the product and stick to it.
Adding further differentiation
Important
Profitable
Distinctive
Criteria
for
Determining
Which
Differences to
Promote
Selecting the Right Competitive Advantage
Differences selected to promote competitive advantage should satisfy the following criteria:
Important. The difference must deliver a highly valued benefit to target buyers.
Distinctive. Competitors do not offer the difference, or the company offers the difference in a more distinctive way.
Superior. The difference should be superior to other ways that customers might obtain the same benefit.
Communicable. The difference is communicable and visible to buyers.
Preemptive. Competitors cannot easily copy the difference. This may be a result of innovative technology, production economies, distribution economies, and/or proprietary rights.
Affordable. Buyers in the target market must be able to pay for the difference.
Profitable. The difference must be profitable for the company to offer.
Affordable
Superior
Communicable
Preemptive

36. Important the difference delivers a highly valued benefit to a sufficient number of buyers.
Distinctive the company can offer it in a more distinctive way.
Superior the difference is superior to other ways that customers might obtain the same benefit.

37. Preemptive competitors cannot easily copy the difference.
Affordable buyers can afford to pay for the difference.
Profitable the company can introduce the difference profitably.

38. Differentiation Strategies
Product
Personnel
Channel
Image

39. Differentiation Variables
Product
Services
Personnel
Channel
Image
Form
Ordering ease
Competence
Coverage
Symbols
Features
Delivery
Courtesy
Expertise
Media
Performance
Installation
Credibility
Atmosphere
Conformance
Customer training
Reliability
Events
Durability
Customer consulting
Responsiveness

40. Product Differentiation ‘Dunkin’ Donuts’
Click on the video icon to see a clip on product differentiation at Dunkin’ Donuts.

41. Product Differentiation
Product form
Features
Performance
Conformance
Durability
Reliability
Reparability
Style
Design
Ordering ease
Delivery
Installation
Customer training
Customer consulting
Maintenance

42. Personnel Differentiation: Singapore Airlines

43. Channel Differentiation

44. Image Differentiation

45. Product Life Cycle
The product life cycle begins when the company finds and develops a new product idea. During product development, the company accumulates increasing investment costs. After the company launches the product, sales pass through an introductory period, then through a period of strong growth, followed by maturity and eventual decline. Meanwhile profits go from negative to positive, peak in the growth or mature sales stages, and then decline.

46. Claims of Product Life Cycles
Products have a limited life
Product sales pass through distinct stages each with different challenges and opportunities
Profits rise and fall at different stages
Products require different strategies in each life cycle stage

47. The Product Life Cycle Concept is Based on Four Premises:
Products have a
limited life
Profits from a product
vary at different stages
in the life cycle
Product sales pass through
distinct stages, each with
different marketing
implications
Products require different
strategies at different
life cycle stages

48. Product life cycle stages:
1.Introduction: A period of slow sales growth as the product is introduced in the market, profit nonexistent because of the heavy expenses of product introduction.
2.Growth: A period of rapid market acceptance & substantial profit improvement.
3.Matiurity: A slowdown in sales growth because the product has achieved acceptance by most potential buyers, profit stabilize or decline because of increased competition.
4.Decline: Sales show a downward drift & profit erode.

49. Product Life Cycle

50. PLC Stages and Characteristics

51. Introduction Stage of the PLC
Product Life-Cycle Strategies
This CTR relates to the material on pp. 289 and 293.
Introduction Stage of the PLC
Sales
Low sales
Product Life Cycle Strategies
Costs
High cost per customer
Introduction. In this stage marketers spend heavily on promotions to inform the target market about the new product's benefits. Low or negative profits may encourage the company to price the product high to help offset expenses. companies can concentrate on skimming strategies to generate high profits now or on penetration strategies to build market share and dominant the market for larger profits once the market stabilizes.
Profits
Negative
Marketing Objectives
Create product awareness
and trial
Product
Offer a basic product
Price
Use cost-plus
Distribution
Build selective distribution
Advertising
Build product awareness among early adopters and dealers

52. Growth Stage of the PLC Sales Costs Profits Product Price Distribution
Product Life-Cycle Strategies
This CTR relates to the material on pp and 293.
Growth Stage of the PLC
Sales
Rapidly rising sales
Product Life-Cycle Strategies
Growth. In this stage the company experiences both increasing sales and competition. Promotion costs are spread over larger volume and strategic decisions focus on growth strategies. Strategies include adding new features, improving quality, increasing distribution, and entering new market segments.
Costs
Average cost per customer
Profits
Rising profits
Marketing Objectives
Maximize market share
Product
Offer product extensions, service, warranty
Price
Price to penetrate market
Distribution
Build intensive distribution
Advertising
Build awareness and interest in the mass market

53. Strategies for Sustaining Rapid Market Growth
Improve product quality, add new features, and improve styling
Add new models and flanker products
Enter new market segments
Increase distribution coverage
Shift from product-awareness advertising to product-preference advertising
Lower prices to attract the next layer of price-sensitive buyers

54. Maturity Stage of the PLC
Product Life-Cycle Strategies
This CTR relates to the material on pp and 293.
Maturity Stage of the PLC
Sales
Peak sales
Costs
Low cost per customer
Product Life Cycle Strategies
Maturity. In this stage the company must manage slower growth over a longer period of time. Strategic decisions made in the growth stage may limit choices now. Marketing managers must proactively seek advantage by either market modification to increase consumption, product modification to attract new users (quality, feature, and style improvements), or marketing mix modification in an attempt to improve competitive position.
Profits
High profits
Marketing Objectives
Maximize profit while defending
market share
Product
Diversify brand and models
Price
Price to match or best competitors
Distribution
Build more intensive distribution
Advertising
Stress brand differences and benefits

55. Maturity Stage: Strategies
Marketers can extend the life of the brand by the following methods:
Market modification: converting nonusers & entering new market segments.
Product modification: quality and features improvements.
Marketing-mix modification: Price, distribution, advertising, sales promotion, services.

56. Ways to Increase Sales Volume
Convert nonusers
Enter new market segments
Attract competitors’ customers
Have consumers use the product on more occasions
Have consumers use more of the product on each occasion
Have consumers use the product in new ways

57. Decline Stage of the PLC
Product Life-Cycle Strategies
This CTR relates to the material on pp
Decline Stage of the PLC
Sales
Declining sales
Costs
Low cost per customer
Product Life Cycle Strategies
Decline. In this stage the costs of managing the product may eventually exceed profits. Rate of decline is a major factor in setting strategy. Management may maintain the brand as competitors drop out, harvest the brand by reducing costs of support for short term profit increases, or drop the product (divest) altogether.
Profits
Declining profits
Marketing Objectives
Reduce expenditure and milk the brand
Product
Phase out weak items
Price
Cut price
Distribution
Go selective: phase out unprofitable outlets
Advertising
Reduce to level needed to retain
hard-core loyal customers

58. Product in Decline

59. Decline Stage: Strategies
Increasing the firm's investment ( to dominate the market or strengthen its competitive position.)
Maintaining the firm’s investment level until the uncertainties about the industry are resolved.
Decreasing the firm’s investment level selectivity, by dropping unprofitable customers, while simultaneously strengthening the firm’s investment in lucrative niches.
Harvesting the firm’s investment to recover cash quickly.
Divesting the business quickly by disposing of its assets as advantageously as possible.