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February 27, 2004

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Jim Paglia

Or maybe, a brand's position is OWNED not by the brander, but by the audience. A position is achieved not in the marketplace, but in the imagination of the target. In that environment, the need for change is self-directed and the brand complies.

Rob Gelphman

It is positioning that matters, not branding. Branding is ubiquity where everyone knows you. Positioning is value where everyone wants you.

Brand is mass appeal. Position is segmentation of customers so you do not waste your time chasing people who could care less.

Brands are stuck in time and can't change because the inherent value is trust. Trust that you will never change.

Position is dynaimic and fluid and is flexible, and desirably so by customers, to change and evolve with the times.

Position leads to brand. Brand does not lead to position.

Position leads to sales. Branding eventually. Maybe.

Startups need positioning to differentiate from the incumbents. Established companies need brand to instill trust that they will not go out of business like the startups.

But trust means never being able to change precisely because the customer does not want you to. Until they do. Then they complain because you did not change fast enough and they buy from the startup.

Read the "Globalization of Nothing" by George Ritzer, Pine Forge Press, 2003. It is very disconcerting, almost depressing, because as a marketer it means the holy grail, brand, is frought with centrally planned and executed product strategies leading to a global market which requires production of essentially the same thing over and over again. Or nothing. No distinguishable characteristic or idiosyncratic distinction.

A hamburger is a hamburger and McDonald's is the same in Tokyo, Paris and New York. But everyone has a favorite hamburger joint and it ain't likely to be McDonald's.

Tom Asacker

Great debate!

By now you've realized that there are no hard and fast branding rules. That game is over. I believe that there is a major marketing revolution underway. One that transcends the old paradigms of both brand image (emotion) and direct marketing (science). It will take me a while to outline it in this blog, so I must defer to a later time. Stay tuned! ;-)

david foster

I do think it's possible for a company to be known for more than "one thing," but it's tricky and there are limits. GE, for example, is known for appliances, jet engines, plastics, financial services, and quite a few other things. (Few companies have successfully managed this breadth). But imagine that through its extensive materials research, GE came up with a new approach to making stylish and comfortable lingerie. It would be very unwise, IMO, for GE to introduce such products under its own brand (how many women would want to wear a GE bra?) They would do much better to license the technology or participate in a JV under someone else's name.

Now, if the new product were a *car*, it probably *could* be sold under the GE brand, though it would take some smart marketing to do it. The fundamental question is how "close" the products are on some kind of psychological map.

Jon Strande - Business Evolutionist

Tom,

Always enjoyable to hear your thoughts on this stuff.

Expectations, isn't that what this is all about? It is what I expect from a brand/product/company?

Cool, so Nokia evolved it's business. I'm sure the first person who bought a Cell phone from Nokia probably questioned it; "You know, I like their toilet paper so the phones must be good." :-)

But over time, they were able to gain market share because they had a quality product. Cost, Quality, and Delivery.

Is the cost reasonable for what I'm getting?
Is it a quality product?
Does it deliver (meet/exceed) on my expectations?

Those three factors, over probably everything else, determine what consumers will allow you to get away with when it comes to selling them something.

Using that criteria, sure, some brands can evolve and serve different markets, but only if they meet those three criteria.

But what you're asking me to believe is that someone will pay $80,000 for a VW instead of trading up to a Mercedes or BMW. Questionable, at best.

I'll agree that today people have come to expect innovation and that allows people to associate "new feelings" with "old brands". But your use of cognitive dissonance here is questionable. Generally, it occurs whenever WE do something that tends to make us feel absurd, stupid or immoral. It always produces discomfort and therefore motivates us to try to reduce the discomfort. There are three ways that we reduce the feeling of dissonance:

1.) Changing our behavior to bring it in line with the dissonant cognition
2.) Justifying our behavior through changing one of the cognitions to make it less dissonant
3.) Justifying our behavior by adding new cognitions

But how does Nokia (or anyone else) changing the company cause US to have dissonance? We didn't do anything. If we accept them into our lives, then we have to make a choice based on trust. If we didn't trust the brand before, then, perhaps, you may have dissonance.

I guess what you're suggesting is that there is a rationalization that takes place in ones mind to introduce a new feeling or belief? Once we make a decision, then we change our cognitions to support our actions. If I think that Nokia is a cell phone company, and not a timber company, then... then what? That is the POSITION that they occupy in my mind. Ask ten people what Nokia does, all ten will probably say "make cell phones". So, what position do they occupy in peoples mind? It is unlikely that they can be both a Cell phone company and a timber company. Those two "offerings" are far too different. Again, they didn't go from one type of company to another overnight. It took time and more importantly... they had to meet/exceed the needs/wants of consumers.

McDonalds? I don't think most people associate "best any-kind-of-burger" with that 'brand' name.

Toyota "morphed"? Toyota became the number two because of Cost, Quality, and Delivery. They met consumer expectations on all three of those things. Any company that can meet those three expectations has a great chance of becoming # 1 or # 2 in their market.

Of course Wal-Mart is able to do that. Sears and K-Mart established that retail concept in peoples mind. One place - Many products. Wal-Mart simply improved it through the advantageous and strategic use of Information Technology to drive inefficiencies out of their supply chain enabling them to offer lower prices than anyone else. There is always room for a low-priced leader in the marketplace.

I still don't think that you've made your case. Each of those companies you mentioned have a position in peoples mind... well, except Microsoft and Virgin, they are exceptions to the rule. Actually, maybe not. Virgin Records. Virgin Airlines. Virgin Mobile. Microsoft Windows. Internet Explorer... hmmm... brand vs. over-brand. Each own a position in peoples mind.

I really like the idea of a narrow focus. Being known for one and only one thing is powerful. Being trusted allows you to evolve into something else as the wants and needs of your consumers change. But, to try to be too many things to too many people is wrong.

You still haven't convinced me... ;-)

Jon

Tom Asacker

Okay Jon . . . I'll bite. ;-)

Yes I DO think positioning, in general, is a dated concept, especially with regards to brand names.

Yesterday's marketing was all about comparative positioning. "We can't own the consumer's desire for low prices, safety, glamour, luxury, etc. 'X' company already owns it." Really?

When I say "Nokia," what does that conjur up in your mind? Boots? Lumber? Toilet paper? Those were Nokia's staple products. Not cell phones. Motorola owned that market.

Didn't you believe that "Cadillac" was a dated brand. A brand that only your uncle would drive? Take a look today.

Best, fast food burger equals . . . McDonald's? I think not. Perhaps IN-N-OUT or FatBurger.

What's a Porche? An SUV? Hmmm. What about the Cayenne?

Think back a few years. What does Microsoft know about the Internet? Pointcast and Netscape owned THAT space.

Today's environment has changed from one driven by awareness and precise positioning, to one driven by creativity and innovation. People buy based on their feelings for new designs, new services, new environments, new business models. If an "old" brand name taps into those feelings in a deep way, people will buy and associate the name with the new feeling. They won't experience cognitive dissonance, because they have become experienced marketers. They know how rapidly things are changing. They've watched companies/brands like:

Toyota morph from a niche automaker of inexpensive, quality cars, to the world's number two automaker (surpassing Ford just this month);

Wal-Mart sell everything from expensive jewelry to grocery products;

Richard Branson's Virgin get into everything from record stores and airlines, to wines, wedding gowns, mobile phones and electronics.

Is an unchanging positioning still the norm for a brand such as "prunes," which conjures up thoughts of wrinkled, old, problems with one's bowel movement, etc. Perhaps? That's why they're now called "Dried Plums." But prunes couldn't enhance their image through product innovation. Most companies can.

Robert  Paterson

I like your idea Jennifer of a total relationship. My dream dealer would make the service department the centre of its relational strategy. This is a non adversarial area where the frequency of personal contact is high. Fred (the service agent) would look at my entire family and not only service my car but look at life events in my family. He could tell that a 3 year old car is coming off lease that would be perfect fro my daughter. He would have serviced it and I will know that I am getting a good car. He could on the death of my mother in law, help me dispose of her car.

His real job - my life car consultant!

My students are looking at relationship and university. No one at University is there to help the student make sense out of the choices. When they leave they become alumni who are seen as targets for fundraising. In fact the kids would like a lot off help when they are there to make better choices and they would like this contact to extend when they graduate - after all they can't stop their learning at 23. They would like to have a learning consultant who could help them navigate though their time there and then when they leave - Everyone would benefit

Jon Strande - Business Evolutionist

Jennifer,

Thank you! Wow, I love the word Magnetic in this context. I have always used that word to describe people... never thought of it in a business sense.

Tom,

Do you really think positioning is dated? I think it is still a valid concept - owning a place in the persons mind, it makes sense. Perhaps the VW position allows them to sell that car... I don't see it happening, but there are plenty of people out there driving a Passat, so who knows. Why would someone pay that much for the Phaeton when they can get a really nice Mercedes or BMW? I don't buy that it will sell. I also think that they are now trying to appeal to too many people... but, I'm not a marketing or branding person, so who knows.

Jon

Tom Asacker

Great points Jennifer. I agree wholeheartedly.

But I believe that the Ries' quote is meant to convey his dated idea (my opinion) of positioning. In Ries' opinion, the word Chevy doesn't mean successful to his hypothetical car buyer. And Ries doesn't believe it ever could, because it already occupies a well-established place in the buyer's mind.

In my humble opinion, that's rubbish. Tell me: what position does VW own in the buyer's mind? Small, funky, youthful? Keep an eye on VW's new $80,000 luxury sedan - Phaeton. If it sells - and I obviously believe that it will - then I rest my case. If it doesn't sell, I'll send my apologies to Mr. Ries. ;-)

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