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Chapter 3

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Department
Marketing
Course
MKT 510
Professor
Ida Berger
Semester
Fall

Description
Chapter 3 —Brand Positioning  Positioning: means identifying & establishing points of parity & points of difference to establish the right brand identity & brand image o Points of difference (POD): reason why consumers should buy the brand (competitive advantage) o Points of parity (POP): similarities between us & other brands (no reason why not for consumers) o Process to cope with competitors o Act of designing the company’s offering & image to occupy a distinctive place in the mind of the target market  Potential differentiation strategies o Product o Channel o Cost o Personnel o Image Developing a positioning statement 1. Determining a frame of reference 2. Developing a positioning statement  Target market  Customer benefit  Brand mantra  Customer need  POD 3. Translating positioning  Externalcore brand associations  Internalbrand mantra Identifying & establishing brand positioning  Brand positioning: act of designing the company’s offer & image so that is occupies a distinct & valued place in the target customers mind o At the heart of marketing strategy o Finding the proper “location” in the minds of a group of consumers, so they think about a product/service in the “right”/desired way to maximize potential benefit  Determining a frame of reference o What are the ideal points-of-parity & points-of-difference brand association’s vis-à-vis the competition? o Marketers need to know:  Who the target consumer is  Who the main competitors are  How the brand is similar to these competitors  How the brand is different from them Target market  Identifying the consumer target is important because different consumers may have different brand knowledge structures & thus different perceptions & preferences for the brand  Market: the set of all actual & potential buyers who have sufficient interest in, income for, & access to a product  Market segmentation: divides the market into distinct groups of homogeneous consumers who have similar needs & consumer behaviour, & who thus require similar marketing mixes o Requires making tradeoffs between costs & benefits Segmentation bases  Consumer segmentation bases o Behavioural o Psychographic o Demographic o Geographic  B2B segmentation bases o Nature of good o Buying condition o Demographic  Toothpaste examples o Four main segments:  Sensory: Seeking flavor & product appearance  Sociables: Seeking brightness of teeth  Worriers: Seeking decay prevention  Independent: Seeking low price Criteria  Identifiability: Can we easily identify the segment?  Size: Is there adequate sales potential in the segment?  Accessibility: Are specialized distribution outlets & communication media available to reach the segment?  Responsiveness: How favorably will the segment respond to a tailored marketing program? Nature of competition  Deciding to target a certain type of consumer often defines the nature of competition  Do not define competition too narrowly o Ex: a luxury good with a strong hedonic benefit like stereo equipment may compete as much with a vacation as with other durable goods like furniture POP & POD  Points-of-difference (PODs): are attributes or benefits that consumers strongly associate with a brand, positively evaluate, & believe that they could not find to the same extent with a competitive brand. different than competitors o Unique selling proposition (USP) o Sustainable competitive advantage (SCA)  Points-of-parity (POPs): not necessarily unique to the brand but may in fact be shared with other brands. same as competitors o Category POP: necessary conditions for the brand  Ex. A bank is not a bank w/o atms, deposit boxes, & available tellers o Competitive POP: if a brand can break even in those areas where its competitors are Positioning guidelines  2 key issues in arriving at the optimal competitive brand positioning 1. Defining & communication the competitive frame of reference 2. Choosing & establishing POP & POD Defining & communicating the competitive frame of reference  Defining a competitive frame of reference for a brand positioning is to determine category membership.  The preferred approach to positioning is to inform consumers of a brand’s membership before stating its point of difference in relationship to other category members.  Category membership: tells consumers about the goals they might achieve by using a product/service  3 main ways to convey a brands category membership 1. Communicating category benefits 3. Relying on the product descriptor 2. Comparing to exemplars Choosing POD  Desirability criteria (consumers perspective) o Relevance consumers must find the POD personally relevant & important o Distinctivenessmust find the POD distinctive & superior o Believabilitycompelling & credible reason for choosing it over another option  Deliverability criteria (firms perspective) o Feasibility can the firm actually create the POD? o Communicabilityprofitable? o Sustainabilityis the positioning pre-emptive, defensive, & difficult to attack? Establishing POP & POD  One challenge for marketers is that many of the attributes or benefits that make up the POP or POP are negatively correlated o Ex. Of negatively correlated attributes & benefits  Low price vs. High quality  Powerful vs. safe  Taste vs. low calories  Strong vs. refined  Nutritious vs. good tasting  Ubiquitous vs. exclusive  Efficacious vs. mild  Varied vs. simple  Ways to address this negative correlation problem o Develop a product of service that performs well on both dimens
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