Archive for June, 2012

 There are three important issues when it comes to Brand Positioning: Define and communicate the competitive Frame of Reference;  define Points of Parity (POPs)  and point out Points of Difference (PODs).

The term frame of reference concerns with category membership of a product or which product category a brand competes with. When a brand compete in a specific market segment, it is supposed to chose a frame of reference and accordingly corresponding POPs and PODs.

When a brand practices a frame of reference to differentiate itself from competing brands, there should have POPs. Basic features and benefits are what is meant by POPs. For example, in the early 1980s, American luxury cars were perceived by many to be  nice-looking. When entering this marker, BMW was able to capitalize on their Germany heritage in auto design sector to introduce a very well-designed luxury car that comes up with fundamental consumers expectation in the luxury auto market.

A brand must essentially have fundamental features and benefits of product category that it belongs to.  They do not help to make brand stand-out, but a brand that falls short on point of parity will struggle to be accepted by consumers. Consumer cannot consider a bank a “real” bank unless this bank offers basic service like savings, deposit or loan along with other discretionary services.

Dominoes has a strong point of difference but have missed a key point of parity. Domino’s pizza differentiates themselves from other by their 30-minute delivery guarantee. The point is that while they manage to keep on delivery superiority, their sales has not gained significant volume due to the failure in fundamental function: Domino’s pizza does not have a good taste & flavor is not as liked as other. Fortunately, Domino’s was aware of this point of parity and a necessary improvement has been made.

Subway has a strong point of difference and they have a key point of parity. In 2011, Subway officially surpassed Mc Donald in terms of number of store (33,749 vs 32,737). This remarkable achievement is attributed to Subway’s prudent competitive strategy. In stead of competing directly with the giant in providing hamberger, Subway originated “fresh” submarine sandwich that is normally made in front of customers. Do you think this point of different made Subway successful? that is true but not enough. The conventional frame of reference in fast-food business is good taste (giant McDonald is strong at this core value). While Subway offers a fresher sandwich, McDonald has greater taste, and their stronger POP gives them an advantage.  Subway competes on healthfulness but its taste is good-enough to be accepted as a fast-food brand, so it is a strong competitor.

A feature may be a point of parity or a point of difference depending on its audience. For example, an inevitable function of a cheep “Made in China” cell phone is calling easiness. In this case, this essential feature is a point of parity for any cheep cell phone brand (can you imagine a low-income buyer buy an cheep mobile phone that cannot serve well in calling?). By contrast, a fundamental characteristic of a smart phone brand is internet connection ability. Similarly, can a business person (or a trendy teenager) accept a smart phone that has very good graphic function (a point of difference) but very week in internet connection?

A brand needs both points of parity and points of difference to be successful. In today’s fierce market, brand differentiation is the first and foremost to win consumer heart. However, points of difference alone are not enough to be succeed in the marketplace. A brand need to come up with basic features in common with competitors. That is called points of parity.

Nguyen Duc Son
Brand Strategy Differentiation

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The recent TVC of Red Bear instant noodle brand of Asia Foods Corporation has triggered very much criticism among consumers. This 30-second TVC tells a story of a child cancer patient who has no money to afford the treatment. Red Bear’s message is: if you buy a pack of Red Bear, you will have donated some money to save poor patients enduring a serious disease.

In a marketer’s viewpoint, we should have a deeper insight on what’s good and bad in Red Bear’s performance instead of echoing this TVC backlash as it is going on in public communication.

The effectiveness of Brand awareness creation

Before Red Bear has been launched, Vietnam’s market is quite crowded with many instant noodle brands (such as Tien Vua, Omachi, Bac Trung Nam, etc.). The late birth certainly challenges Red Bear to create brand awareness in the mind of consumers.

With noises after the TVC’s constant airing, it can be considered that Red Bear has succeeded to “stamp” Red Bear brand in consumers’ minds whenever consumers think of instant noodle.

Despite a lot of criticism, it is apparent that a group of consumers has got “moved” by Red Bear’s tears. Remember that the major target audience of instant noodle is housewives who are easily touched and they do not judge a message in a complex way as marketers.

The effectiveness of Brand Image creation

Unlike other competitors who often emphasize on the functional differentiation or product benefits (Ex. Omachi noodle is made from potato, which does not make hot inside, Tien Vua noodle is healthy because it is not yellowed by chemicals, etc.), Red Bear’s message is “Tie people’s love” with the purpose of raise the consumer’s humanity.

I think Red Bear’s concept is not wrong when Red Beer capitalizes on Vietnamese humanity tradition (Red Bear uses emotional appeal instead of rational appeal like other competitors). However, the weakness of this TVC is that this brand has gone too far  in raising people’s sympathy: the TVC mainly shows “cancer” and tears for the wholetime. In addition, the “charity” message is quite sensitive to use in a commercial, which easily creates “unpleasant” feeling for the audience.  Remember Vinamilk’s TVC of sharing 6 million glasses of milk with the similar “charity” message. They succeeded because the way to communicate the message is very moderate and natural.

It’s unsurprising that Red Beer’s TVC triggers negative reaction from the media and consumers. The worst result is that Red Bear brand image is somehow defected in the consumer’s minds.

Red Bear trade-offs emotional product benefits against  the emotional message “Tie people’s love”. Unfortunately, it has raised negative communication effects. Therefore, it can be considered as a communication strategy failure though Red Bear was successful to create a high rate of brand awareness.

The lesson from this case is that the culture issue should be considered thoroughly in any communication/advertising campaign. Vietnamese people are quite sensitive when receiving humanity-related messages. The advertisement itself suffers bias from consumers. If advertisement uses unlucky lives to convey its message, the brand is likely to face communication crisis.

Red Bear’s story partially proves the point given in the book “The fall of advertising, the raise of PR” written by American marketing genius Al Ries 10 years ago. The book makes a new point that PR plays an important role in branding while advertising only maintains the brand image created by PR. Red Bear would had not faced the crisis if they has conducted PR activities to successfully create a well-known brand image of charity activities?

There is no chance for Red Bear to change what happened. However, other brands can avoid the same failure indeed.

Nguyen Duc Son

Brand Strategy Director – Richard Moore Associates

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