One of marketing’s key tasks is differentiation: helping a brand to stand out from the crowd of other options. There are many different ways to differentiate a brand, but there is no ‘right’ or ‘wrong’ answer; it’s simply a case of understanding what works best for your brand and the kinds of people you want to attract.
Price Differentiation
This is the most basic form of differentiation, although there are a few variations on the theme:
Super Discount
Differentiation based on being the cheapest. It’s clear to see why it appeals to consumers, but it’s a cul-de-sac for the brand: ever-eroding profit margins and constant compromises on quality make it difficult to sustain.
Highest Price
People sometimes use price as a proxy for determining ‘quality’, particularly in complex or technical categories. This technique interprets that insight to suggest that a high price is actually desirable in certain circumstances.
This is particularly true in the pharmaceutical and child-care categories, where brands often play on people’s fears of the perceived ‘compromise’ they associate with cheaper brands.
It is also a favourite technique amongst luxury brands, who use exaggerated pricing to transform their offerings into status symbols and badges of wealth and success.
Mid Point
Adopting a price point that lies between the prices of existing competitors establishes a safe, ‘middle-of-the-road’ positioning that neither offends nor excites anyone. It appeals to people who want to compromise, and as a consequence, it rarely delivers meaningful differentiation.
Quantifiable Superiority
The brand differentiates its offering via measurable attributes, e.g.:
The speed of a computer processor
The amount of legroom on an airline
The number of years a malt whisky has been aged
This approach works well for brands that can deliver superior functional performance over time.
However, the brand risks losing its differentiation if another brand can deliver similar or superior performance, or if another brand succeeds in changing the basis for comparison to a different product or brand attribute.
It’s worth noting that brands can celebrate any attribute they choose, regardless of whether that attribute contributes significantly to its offering’s core performance, provided it can justify the relevance of that attribute.
There are a few variations on the Quantifiable Superiority approach:
Size Matters
This approach focuses on a comparative maximum or minimum of size, irrespective of how this impacts actual value – i.e. quantity over quality:
· The hotel with the most rooms
· The cable plan with the most channels
· The smallest phone on the market
A parallel to this is the ‘blanket advertising’ approach, where the brand attempts to differentiate by shouting as loudly as it can, so that people simply can’t ignore it.
These approaches are neither pretty nor subtle – they are the marketing equivalent of a man measuring his appendage – but their use is still widespread.
However, such popularity does not denote effectiveness.
Safety in Numbers
This approach harnesses the ‘herd instinct’, using rational claims to overcome more subjective concerns:
“Millions of satisfied customers can’t be wrong”
“The nation’s favourite”
“We work with more Fortune 500 brands than any of our competitors”
This works well in categories where measures of performance are more subjective; where people aren’t sure what really matters; or where competing brands emphasise a variety of unconnected attributes.
Interestingly, brands can also harness the opposite approach – ‘small for a reason’ – to equal effect, e.g.:
“For those who know the difference”
“Think different”
“Go your own way”
This is ultimately a volume limiting strategy, but the approach supports premium pricing that can offset lower unit sales.
Distribution
The places where you make your brand available will play a strong part in establishing and reinforcing your positioning. However, distribution can also be used as a differentiation strategy in its own right.
Brands like Avon, Tupperware, and even Dell managed to break free from the traditional confines of their categories by making their brands available through new and relevant channels.
There are two broad routes to differentiated distribution: Wherever, whenever
Although it may not the key pillar of the brand’s differentiation, this approach is most famously adopted by Coke, with their ‘always within arm’s reach‘ philosophy. Quick-service restaurants and mobile communications networks often emphasise it too.
It requires considerable commitment to introduce and maintain, and it’s fairly obvious if the brand doesn’t achieve it (“they’re everywhere, except when I need them!”).
However, when implemented successfully, it creates ‘monopoly through ubiquity’; although it might not be a person’s favourite brand, they will continue to choose it because it’s always there when others aren’t.
Exclusivity
Conversely, restricting the supply and availability of your brand can help to make it more desirable, particularly in categories like luxury and ‘gadget’ technology.
It can work well for high-quality brands if used in conjunction with other approaches – notably highest price – but basing an entire differentiation strategy on restricted availability will most likely just frustrate people and accelerate the brand’s demise.
Heritage
This approach plays on the belief that longevity is a reliable indication of experience and trustworthiness; e.g.:
“Established in 1823”
“A family recipe handed down over the generations”
“The original…”
Although not as extreme, this approach suffers from issues similar to Safety in Numbers: it is very effective in situations where people don’t know much about the category, or where it’s difficult to compare competitor claims, but it loses its advantage as soon as a competitor establishes a more compelling basis for comparison.
Rational Advantage
The brand demonstrates or claims superiority through a rational benefit of its offering, e.g.:
· Saves you time
· “Won’t let you down”
· Simple enough for anyone to use
This approach shifts the focus from the functional attribute to the benefit that the attribute delivers, but it suffers from risks similar to those associated with the Quantifiable Superiority approach, and consequently may not be sustainable.
Augmented Product
Effectively a derivative of the Rational Advantage approach, this approach highlights advantages offered by features other than the core product, e.g.: The purchase experience
After-sales support
Distribution or delivery
When used correctly, these features become more important than the product offering itself, and help to establish deep and lasting relationships with the brand’s customers.
Outstanding Promotion
Although common and seemingly attractive, this approach is highly risky, because it encourages people to focus on superficial aspects of the brand that have little to do with the product’s core benefit.
While this may be acceptable in spontaneous, low-risk purchase categories such as snacks, it is rarely sustainable elsewhere.
However, attractive packaging, beautiful merchandising, and slick advertising all help to solicit attention that enables the brand to introduce more complex or substantial dimensions of differentiation.
The Secret Formula, or Magic Ingredient
This approach bridges functional and emotional claims by harnessing what could be termed ‘irrational functional’ claims:
“A formula known only to 3 people in the world”
“With patented compound Q16e”
“A secret blend of 11 unique herbs and spices”
Brands that have used this approach to varying degrees of success include KFC, Kellogg’s Frosties, as well as numerous cosmetics brands.
When it harnesses a relevant truth, or is executed with appropriate humour, this approach can be highly engaging.
However, beware of relying on shallow claims, particularly in relation to pseudo-science; while you may fool people for a short while, if people discover or perceive that your brand is all ‘hot air’, you won’t have any equity left.
Implied Superiority
Exaggerating or downplaying other elements of the marketing mix can infer superiority on the product itself.
We’ve already seen how outstanding promotion or unexpectedly high pricing work, but downplaying such elements can also work when carefully implemented:
Purposely bland packaging in a category where extravagance is the norm
“A well-kept secret – the specialist connoisseur’s brand”
“We don’t need to advertise; this product sells itself”
This approach can afford high margins, but is not without risk.
In particular, it suffers from the ‘emperor’s new clothes’ dilemma: it works brilliantly provided there’s real substance behind the exaggeration.
Subjective Superiority
The brand asserts its superiority based on subjective measures that are difficult to measure:
“Best-tasting brand”
“Probably the best lager in the world”
“If your pet could choose, they would buy this brand”
This approach is often carefully controlled by law to prevent misleading advertising.
However, provided the brand stays within relevant guidelines, and as long as the execution fits clearly with the brand’s overall personality, it can successfully engage audiences.
It seems particularly effective when used with irreverent humour.
Emotional Appeals
The brand highlights how it makes you feel, rather than what it does:
“Open happiness”
“A glass and a half full of joy”
This is an exceptionally powerful route to differentiation, because it allows the brand to break free from the limitations associated with functional product features, and instead focus on areas that foster more enduring bonds.
The brand can emphasise any emotion it likes, but those emotions that people commonly associate with the product’s functional benefits are often the simplest to establish.
It’s worth noting that brands can still gain an advantage over competitors by harnessing emotions that are generic to the category, provided they are the first or most credible claimants.
Flattery and Justification
This approach is more of an advertising technique than a unique differentiating approach, but deserves mention due to its ability to engage specific groups:
“Because you’re worth it”
“You deserve it”
“Go on, indulge yourself”
There are many variations on this theme, but they all pander to some sense of inner insecurity.
Although not particularly subtle, this approach can establish a deep bond, and is therefore worthy of consideration.
Pushing Up On Affinity
This approach is more about establishing a differentiated brand personality than it is about demonstrating tangible product differentiation.
The simplest approach is to highlight things that the brand has in common with the people it wants to engage – just as people who are meeting for the first time do. This is one of the main uses of sponsorship: brands attempt to connect with people by demonstrating shared ‘passions’.
A more difficult, yet potentially more engaging approach is to create a new focus for people’s attention. Red Bull has employed this strategy for a number of years, and has enjoyed considerable success with activities such as its Flugtag and Air Race events.
Despite their simplicity, Affinity Plays are difficult to implement successfully, because it’s very easy for the brand to come across as a me-too brand that’s trying too hard.
However, brands that succeed enjoy lasting success, because they establish meaningful relationships with people beyond the tangible and functional qualities of their products.
The key is to demonstrate early and lasting commitment to the area of focus; arriving late to the party makes it much more difficult for the brand to establish credibility.
The Choice Of…
A slight variation on Affinity Plays, this approach highlights the choices of people or groups that the brand believes its target feel an affinity towards.
It builds affinity by association:
By appointment to the Queen
George Clooney’s choice
The choice of a new generation
The approach is similar to Safety in Numbers, but emphasizes emotional appeals over measures of sheer magnitude or volume.
