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LEARNING OBJECTIVES
In this chapter we will address the following questions:
1. How can a firm develop and establish an effective positioning in the market?
2. How do marketers identify and analyze competition?
3. How are brands successfully differentiated?
4. How do firms communicate their positioning?
5. What are some alternative approaches to positioning?
6. What are the differences in positioning and branding for a small business?
SUMMARY
1. To develop an effective positioning, a company must study competitors as well as
2. Developing a positioning requires identifying a frame of reference—by locating the
3. A company’s closest competitors are those seeking to satisfy the same customers and
4. Points-of-difference are those associations unique to the brand that are also strongly
held and favorably evaluated by consumers. These differences may be based directly
5. Points-of-parity are those associations not necessarily unique to the brand but perhaps
shared with other brands. They help to negate any potential weaknesses for the brand.
6. Emotional branding is becoming an important way to connect with customers and
7. Several different alternative approaches exist to position a product or service. These
C H A P T E R
10
CRAFTING THE BRAND
POSITIONING
8. Although small businesses should adhere to many of the branding and positioning
principles larger companies use, they must place extra emphasis on their brand
elements and secondary associations, be more focused, and create buzz for their brand.
OPENING THOUGHT
A barrier to effective learning that can be experienced by students in this chapter comes
from the concept of “positioning.” Students will be familiar with different products or
services, but having them realize what the products and services “positions are” within
their frame of references is challenging to verbalize. The instructor is encouraged to use a
number of examples of products or services familiar to the students to get this concept
fully across.
TEACHING STRATEGY AND CLASS ORGANIZATION
PROJECTS
1. At this point in the semester, student projects should be completed to include their
2. Relevant to the opening vignette of the chapter concerning The Public Broadcasting
Service’s positioning and differentiation, students are to devise a positioning and
differentiation strategy for their own local PBS system (radio or television). Students
should arrange to meet with local PBS management to elicit information on what
challenges their local station(s) is/are having in increasing their viewership/listeners.
3. Sonic PDA Marketing Plan: The third part of STP is to select and communicate an
effective positioning to differentiate your offering from competitors’ offerings. The
marketer must also plan for appropriate marketing strategies for each stage of the
product life cycle. As you continue your work to develop Sonic’s marketing plan for
launching Sonic 1000, consider these questions about differentiation and life-cycle
strategies:
• Which of the differentiation variables related to product, services, personnel,
channels, and image are best suited for Sonic’s situation, strategy, and marketing
objectives? Why?
ASSIGNMENTS
Most campus communities have their own radio and/or television broadcasting stations.
If one is present on your campus, students are to define the college or university’s
station(s) in terms of positioning and differentiation strategy. What stage in the product’s
life cycle are the station(s)? What can be done to reposition the station(s) to attract more
viewership? What is the competitive advantage present in their operations?
Consultants Michael Treacy and Fred Wiersema, in their book, The Disciplines of Market
Leaders (Reading, MA: Addison-Wesley, 1994) proposed a positioning framework called
value disciplines. Within its industry, a firm could aspire to be the product leader,
operationally excellent firm, or customer intimate firm. Choosing an industry, each
student is to identify one or more firms operating within that industry that fits each of
these three value disciplines. Students should define their reasoning for selecting each
firm and its placement as either the product leader, operationally excellent or customer
intimate.
Points-of-differences and points-of-parity are two important concepts of brand
development and are driven by two differing strategies—inclusion and differentiation.
END-OF-CHAPTER SUPPORT
Marketing Debate--What Is the Best Way to Position?
Marketers have different views of how to position a brand. Some value structured
Take a position: The best way to position a brand is through a structured approach
versus the best way to position a brand is through an unstructured approach.
Suggested Answer: Student answers will vary but good students will cite as either for or
against this statement that companies must:
1) Study competitors as well as actual and potential customers; optimal point of parity
and points of differentiation; that points of differences are associations and are strongly
Marketing Discussion
Identify other negatively correlated attributes and benefits not described in the chapter
above. What strategies do firms use to try to position themselves on the basis of pairs of
attributes and benefits?
• Fun to drive and good gas mileage: for cars, this is an ongoing challenge along with safe
and good gas mileage and “large” and good gas mileage.
• Safe and scary—amusement rides, movies, television shows, books.
• Choices and convenience: variety in our shopping but sized for convenience (has the right
mix of products but is not too big—convenience stores).
• Close but not too close—shopping centers and large mega-stores close enough but “not in
my backyard.”
Marketing Excellence: Louis Vuitton
Questions:
1) How does an exclusive brand such as Louis Vuitton grow and stay fresh while
retaining its cachet?
2) Is the counterfeiting of Louis Vuitton always a negative? Are there any circumstances
in which it could be seen as having some positive aspects?
Suggested Answer: Counterfeiting of LV products increases the brand’s emotional
Marketing Excellence: American Express
Questions:
1. Evaluate American Express in terms of its competitors. How has its positioning
changed over time? Where does American Express face the most competition?
2. Evaluate American Express’ integration of its various businesses. What recommendations
would you make in order to maximize the contribution to equity of all its business units? Is the
corporate brand sufficiently coherent?
Suggested Answer: Student answers will vary but good students will note that AE has a strong
DETAILED CHAPTER OUTLINE
Opening vignette: A company can benefit if it has a compelling, well-differentiated brand
position, but it can only uncover the most powerful brand positioning with awareness of
its capabilities, competition, and its consumers’ needs and wants.
I. Developing a Brand Positioning
A. Marketing strategy is built on segmentation, targeting, and positioning (STP)
B. Positioning is the act of designing a company’s offering and image to occupy
a distinctive place in the minds of the target market
i. Brand substitution test: if a brand were replaced by a competitive
C. Positioning requires that marketers define and communicate similarities and
differences between their brand and its competitors
i. Choose a frame of reference by identifying the target market and
relevant competition
ii. Identify the optimal points-of-parity and points-of-difference brand
associations given that frame of reference
iii. Create a brand mantra summarizing the positioning and essence of the
brand
II. Choosing a Competitive Frame of References
A. A competitive frame of reference defines which brands a brand competes with
—the focus of competitive analysis
B. The target market decision helps define competitors
2. Degree of product differentiation
4. Cost structure
6. Degree of globalization
iv. Competitors are companies that satisfy the same customer need
v. Marketing myopia is near sightedness/a narrow focus where you miss
substitutes
C. Map the buyer’s steps in obtaining and using a product to profile direct and
indirect competitors
i. Analyze competitors real and perceived strengths and weaknesses
D. Identify potential points-of-difference
i. Points of difference (PODs) are attributes 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.
ii. Strong brands often have multiple points-of-difference.
iii. Creating strong, favorable, and unique associations is a real challenge,
but an essential one for competitive brand positioning.
iv. Three criteria determine whether a brand association can truly function
as a point-of-difference: desirability, deliverability, and
differentiability.
1. Desirable to the consumer: personally relevant and there must
2. Deliverable by the company: The company must have the
internal resources and commitment to feasibly and profitably
3. Differentiating from competitors. Consumers must see the
brand association as distinctive and superior to relevant
competitors.
E. Identify Points-of-Parity (POPs)
i. Points-of-Parity are attribute or benefit associations that are not
1. Category points-of-parity are attributes or benefits that
consumers view as essential to a legitimate and credible
2. Correlational points-of-parity are potentially negative
3. Competitive points-of-parity are associations designed to
overcome perceived weaknesses of the brand in light of
competitors’ points-of-difference.
a. One good way to uncover key competitive points-of-
iii. Often, the key to positioning is not so much achieving a point-of-
difference as achieving points-of-parity
F. It is not uncommon for a brand to identify multiple frames of reference
i. Some POPs and PODs will be unique to one competitive frame of
reference; others might be shared
iii. If the competition is too diverse, it may be necessary to prioritize
competitors and then choose the most important set of competitors to
serve as the competitive frame
iv. Try to be all things to all people—that leads to lowest-common-
denominator positioning, which is typically ineffective.
v. It may be useful to either develop the positioning at the categorical
level for all relevant categories or with an exemplar from each
category
G. Straddle positioning: a company straddles two frames of reference with one
set of points-of-difference and points-of-parity
i. The points-of-difference for one category become points-of-parity for
H. Choosing Specific POPs and PODs
i. Competitive advantage is a company’s ability to perform in one or
more ways that competitors cannot or will not match
iii. A leverageable advantage is one that a company can use as a
springboard to new advantages
iv. Marketers typically focus on brand benefits in choosing the points-of-
vi. Means of Differentiation
1. Any product or service benefit that is sufficiently desirable,
2. The most compelling means of differentiation for consumers
are benefits related to performance
3. Often a brand’s positioning transcends its performance
4. To identify possible means of differentiation, marketers have to
match consumers’ desire for a benefit with their company’s
1. They provide quantitative pictures of market situations and the
2. By overlaying consumer preferences with brand perceptions,
marketers can reveal “holes” or “openings” that suggest unmet
2. Authenticity also has functional value
3. Emotional brands can also provide financial payoffs
I. Brand Mantras: three- to five-word articulations of the heart and soul of the
brand
i. Closely related to other branding concepts like “brand essence” and
2. Three key criteria for a brand mantra:
a. Communicate—clarify what is unique about the brand.
b. Simplify—memorable; short, crisp, and vivid in
III. Establishing a Brand Positioning
A. A brand bull’s-eye provides content and context to improve everyone’s
understanding of the positioning of a brand in the organization
i. The inner two circles is the heart of the bull’s-eye—key points-of-
parity and points-of-difference as well as the brand mantra
1. Points-of-parity and points-of-difference should be made as
specific as possible without being too narrow
2. Points-of-parity and points-of-difference should be constructed
3. Points-of-difference should also be stated in positive,
aspirational terms
ii. In the next circle out are the substantiators or reasons-to-believe
(RTB)—attributes or benefits that provide factual or demonstrable
support for the points-of-parity and points-of-difference.
iii. Finally, the outer circle contains two other useful branding concepts:
1. The brand values, personality, or character—intangible
2. Executional properties and visual identity—more tangible
components of the brand that affect the way customers see it
iv. Three boxes outside the bull’s-eye provide useful context and
interpretation.
1. One includes the consumer target and a key insight about
2. One box provides competitive information about the key
3. One box offers a “big picture” view of the output—the ideal
consumer takeaway if the brand positioning efforts are
successful
B. Often a good positioning will have several PODs and POPs, but two or three
C. Brands need to communicate category membership, which may or may not be
obvious
i. The typical approach to positioning is to inform consumers of a
brand’s membership before stating its point-of-difference.
ii. There are three main ways to convey a brand’s category membership:
2. Compare to exemplars—Well-known, noteworthy brands in a
category can also help a brand specify its category membership
3. Rely on the product descriptor
D. One common challenge in positioning is that many of the benefits that make
2. Linking the brand to a person, place, or thing that possesses the
3. Convincing consumers that the negative relationship between
attributes and benefits, if they consider it differently, is in fact
positive.
E. It is important to regularly research the desirability, deliverability, and
differentiability of the brand’s POPs and PODs in the marketplace to
understand how the brand positioning might need to evolve or, in relatively
rare cases, be completely replaced.
i. In assessing potential threats from competitors, three high-level
variables are useful:
1. Share of market
3. Share of heart
Companies that make steady gains in mind share and heart share will inevitably make
gains in market share and profitability
IV. Alternative Approaches to Positioning
A. Brand Narratives and Storytelling: rather than outlining specific attributes or
benefits, some marketing experts describe positioning a brand as telling a
narrative or story.
ii. Five elements of narrative branding:
1. The brand story in terms of words and metaphors
2. The consumer journey or the way consumers engage with the
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
iii. Framework for a brand story:
1. Setting: time, place, and context
2. Cast: The brand as a character, including its role in the life of
3. Narrative arc: The way the narrative logic unfolds over time,
4. Language: The authenticating voice, metaphors, symbols,
themes, and leitmotifs
B. Primal branding views brands as complex belief systems
i. Seven assets make up this belief system or primal code: a creation
story, creed, icon, rituals, sacred words, a way of dealing with
nonbelievers, and a good leader
C. Cultural Branding suggests that for companies to build iconic, leadership
brands, they must assemble cultural knowledge, strategize according to
cultural branding principles, and hire and train cultural experts
V. Positioning and Branding for a Small Business
A. Building brands is a challenge for a small business with limited resources and
budgets
i. Focus and consistency in marketing programs become critically
important
ii. Creativity is also paramount—finding new ways to market new ideas
about products to consumers
