Re-positioning competitors is one of the most popular brand differentiation strategies applied by brand having certain competitive advantages that are untapped or are somehow claimed to be competitor’s advantage. In addition, re-positioning competitors is a wise brand communication strategy when competitors are losing competitive advantage.
Spanish olive re-positioned Italian olive
Spain is the world largest olive exporter, followed by Italy with half production compared to Spain’s production capacity. Customers, however, think that Italy is the world No.1 olive brand. The reason is that Italian imports olive from Spain, and then can and sell under “Made in Italy” label.
To affirm its leading position, Spanish has made a wise campaign. Consulted by the talented brand strategist Jack Trout, they “re-positioned” Italy’s second position through the communication message “Roman was our largest customers 2,000 years ago. So as they arre today.”
The success of this typical re-positioning campaign is due to 2 important factors. First, Spanish tells a good brand story related to their direct competitor: Italy is Spain’s largest olive importers. Second, the way of communication is very smart, sophisticated, without self-claiming and weighing down their competitor.
Russian vodka repositioned American vodka
Some products have the typical regional and national prestige. Let’s say Vodka, Vodka that is manufactured in Russia is the “authentic” Vodka.
In the U.S, there are many Vodka brands that are manufactured in the U.S. Many American overlook this fact.
Understand this, Stolichnaya, a Russian Vodka brand, made an advertising campaign in the U.S with the message that they are authentic Russian Vodka made at Leningrad city. Simply, they “re-positioned” other “Made in USA” Vodka brands as inauthentic Vodka.
Is Trung Nguyen right in “re-positioning” Starbucks?
Regarding the communication strategy, Trung Nguyen seems to be lack of necessary patience of a big brand (at least as the most famous Vietnamese coffee brand) when they have continuously weighed Starbucks down by a series of direct criticism.
However, Mr. Dang Le Nguyen Vu has a reason when he called Starbucks “the giant with no spirit”. While it is still a controversial statement, this is the most well-founded claim among many “arrows” from the bow “Trung Nguyen”.
It is true that Starbucks is changing its brand positioning from the only association of “coffee” to the associations of “coffee and fast food”.
Howard Schultz, CEO of Starbucks, stated that: “Although we are a coffee brand, we may sell other products” (According to China Daily USA “Starbucks new logo drops company name”)
The trap of brand extension is the lesson from uncountable famous brands. Wrong brand extension is the fastest way to kill the unique identity of a brand. (Extension law from “The 22 immutable laws of marketing” by Al Ries and Jack Trout).
If Starbucks follows the strategy as Howard Schult statement, there will be new Starbucks products that are unrelated to coffee soon in the market. In the short run, it is the shortest way to help Starbucks generate revenue. In the long run, the priceless “The third place” positioning may no longer belong to the Mermaid. For this aspect, it worths for Starbucks and competitors like Trung Nguyen to think about Al Ries’s comparison: brand extension is the stimulus in the short run but depressant in the long run.
Mr. Vu has his reason when saying that Starbucks is “the giant without any spirit”. However, Trung Nguyen would have not received such criticism if they had stated that Starbucks is “the giant that faces the risk of losing identity”. Currently, Starbucks is still the giant that has not lost identity yet. If they did not have a sound identity, people would not have queued as Starbucks opens new shops in the new markets. Starbucks is now still the No.1 coffee brand in the customer’s mind.
The story of “having no identity” is different from “losing identity”. Being more careful and wise in talking about competitors is needed.
Trung Nguyen can even “re-position” the huge competitor with kind of claim like “Starbucks is the No.1 giant in … fast food chain”.
It is reasonable. There is no longer “Starbucks Coffee” in Starbucks’ new logo.
Nguyễn Đức Sơn
Brand Strategy Director – Richard Moore Associates