Developing Brand Strategy

 Target Market

• Defined by 5 factors: 

Customers whose needs the company aims to fulfill 

Competitors that aim to fulfill the same needs of the same target customers 

Collaborators that work with the company to fulfill target customers’ needs 

The company managing the offering 

The context in which the company operates

• CUSTOMERS 

- The entities (organizations or individuals) whose needs the company aims to fulfill. 

- In B2C, customers are the individuals who are typically the end users of the company’s offerings. 

- In B2B, customers are other businesses that use the company’s offerings.

• CUSTOMERS Customers are defined by two factors: 

- Customer needs Reflect the specific problem faced by customers that the company aims to address. 

- Customer profile Reflects customers’ observable characteristics. 

Customer profile involves 2 types of characteristics: 

• Demographics: age, gender, income, occupation, education, religion, ethnicity, nationality, employment, geographic location, social class, household size, family life cycle, interests, and hobbies. 
• Behavior: shopping habits, purchase frequency, purchase quantity, price sensitivity, sensitivity to promotional activities, loyalty, and social and leisure activities.

• COMPETITORS 

- Aim to fulfill the same need of the same customers as the company does. 

- Competitors are defined relative to customer needs, not merely based on the industry within which they operate.

• COLLABORATORS 

- Entities that work with the company to build and manage the brand. 

- It involves cobranding, whereby two or more companies develop a joint strategy to leverage one another’s brand power and achieve synergies from linking their brands. 

- Common types of collaborators include suppliers, manufacturers, distributors (dealers, wholesalers, and retailers), R&D, service providers, external sales force, advertising agencies, and marketing research companies.

• COMPANY 

- The entity that develops and manages a given market offering. - Can be a manufacturer that produces the actual goods being sold (P&G), a service provider (American Express), an entity engaged in brand building (Lacoste), a media company (Facebook), or a retailer (Walmart).

Company is defined by two factors: 

- Profile (company’s characteristics) The resources that determine its ability to create market value and a sustainable competitive advantage. Ex: business facilities, suppliers, employees, existing products, services and brands, communication and distribution channels. 

- Goals The end result that the company aims to achieve with a particular offering. Ex: maximizing profits, creating synergies with other company offerings and creating value for society at large

• CONTEXT 

- Sociocultural Social and demographic trends, value systems, religion, language, lifestyles, attitudes, and beliefs. 

- Technological New techniques, skills, methods, manufacturing, communication, and delivering market offerings.

- Regulatory Taxes, import tariffs, embargoes, pricing, intellectual property laws. 

- Economic Economic growth, money supply, inflation, interest rates. 

- Physical Natural resources, climate, geographic location, topography, health trends.

Value Proposition

• Definition: an innovation, service, or feature intended to make a company or product attractive to customers. 

• When developing market offerings, a company needs to consider three types of value: 

• Customer Value 
• Collaborator Value 
• Company Value

1. Customer Value 

- The worth of an offering to its customers; it is customers’ assessment of the degree to which an offering fulfills their needs. 

- Points of dominance (PoD) A company’s offering is superior to the competition. Ex: higher reliability, greater comfort, and better performance 

- Points of Parity (PoP) A company’s offering is equal to the competition. Ex: an offering’s durability might be identical to that of its competitors. 

- Points of Compromise (PoC) A company’s offering is inferior to the competition. Ex: customers might compromise on price in order to gain higher levels of reliability, comfort, and performance.

- Functional Value The benefits and costs related to an offering’s practical utility such as performance, reliability, durability, compatibility, ease of use, design, and customization. 

- Psychological Value The mental benefits and costs of the offering, such as the emotional experience provided by the offering and the offering’s ability to signal a customer’s social status and personality. 

- Monetary Value The financial benefits and costs of the offering, such as its price, fees, discounts, and rebates.

2. Collaborator Value 

- The worth of an offering to the company’s collaborators; it is the sum of all benefits and costs that an offering creates for collaborators

A company’s offering can create two types of collaborator: 

- Monetary Value Involves the monetary benefits and costs, such as net income, profit margins, sales revenue, earnings per share, and ROI. 

- Strategic Value Involves nonmonetary benefits and costs that are of strategic importance to company collaborators.

Brand Positioning : : The process of creating a meaningful and distinct image of a brand in target customers’ minds.

Brand Mantra (Slogan)

• The brand essence and brand's core promise to its customers. 

• A three-to-five-word. 

• Not an advertising slogan or tagline. 

Example: - McDonald’s: Food, Folks,Fun.   - Disney : Fun, Family, Entertainment