Is brand differentiation still possible

Is brand differentiation still possible?

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Short answer – yes it is, but not in the way it was.

I haven’t met a brand manager yet who didn’t tell me that they had a differentiated product. I’m not surprised. It’s part of the job description of any brand owner to be marketing something that is disruptive, market-changing, blue-ocean, category-killing … 15 years on from when I first suggested “parity is the real pariah”, every brand’s still talking up difference – but consumers are increasingly hard pressed to see any.

In some ways, marketers only have themselves to blame. Enthused by the need to be so very different from everyone else, marketers seem to have searched, then compromised and finally settled for nit-picking their way to a self-appointed category-of-one. Is it time to call time? Perhaps if more brands admitted that the chances of them redefining the universe at a product or service level were nil, they could focus more on the things that do matter.

We’ve been drawn into the innovation myth – the belief that brands can invent their way to market dominance.

Most brands still believe they can invent their way to market dominance. At best, “innovation” (which would better be described across the majority of the market as improvement) will keep them on a par with those around them. At worst, it will lure them into risking massive resources for a difference they will never make.

So let’s talk about a shift of focus: from big picture, broad brush disruptive market plays to a new era of specific, individualised small plays. In the new world of the quantified self and the emerging Internet Of Everything, brand differentiation today is really about what a brand does for “me” not how it revolutionises whole swathes of a sector.

Will Novosedlik posted this timely reminder recently: “We’re not in the land of Trout and Ries anymore, folks. We are in a networked economy characterized by constant technological disruption, channel proliferation and fragmentation, overpopulated categories and far fewer opportunities for differentiation. Far more empowered and influential customers are forcing a shift from customer acquisition to customer retention and from messaging to experience. They don’t want to listen to brands; they wants brands to listen to them.”

Big data and little data

Take that one step further. Not just listen – cater. They want their brands to come closer and act as an extension of their extending world. In a recent McKinsey interview with Ola Källenius, the global head of marketing at Daimler AG talked about how the luxury car maker was forging a new type of customer experience through “Mercedes me”. It seamlessly integrates what Daimler AG know universally about their cars with what each driver experiences, through a single Mercedes ID that links a driver’s smartphone with their car and the manufacturer.

This combination of big data and little data (the view that each individual forges of themselves through their habits and their social and brand choices) will in my view redefine how customers find difference across brands. Differentiation won’t be about one big thing anymore. Increasingly, it must be about a personalized configuration of ideas that click with people’s worldviews.

According to Nigel Hollis, consumers don’t see difference, but they will find it. “On average, the proportion of people willing to endorse any brand as “different from other brands of (a specific category)” is low. But perceived differentiation is only important once buyers believe that a brand is acceptable — that is, that it meets their basic needs and is an acceptable choice.”

And that’s the new confluence – to advocate a view of the world that consumers are drawn to, believe in and find “acceptable” (a concept I have previously referred to as a Unique Brand Perspective) coupled with smart and individually specific ways of connecting, increasingly through devices, that consumers find intriguing, rewarding and inspiring. Universal and personal.

The end of big-bang difference

Let’s stop looking for big-bang difference on the shelf because for most brands I don’t think that’s where competitiveness is going to be found going forward. And stop bragging about how great you art. Most big brands can do campaigns. There’s no differentiation there. Chances are no-one’s listening anyway. Instead:

  • Break with a simple tradition in the sector. The simpler, the better.
  • Import something simple from another sector. Again, the simpler, the better.
  • Leverage how people want to make decisions – don’t fight with it (by asking them to make decisions in ways that feel foreign to them)
  • Help consumers navigate the massive choice set that confronts them, rather than adding to the clutter with more and more information
  • Stand for something in the world that makes sense, makes headlines and aligns with what you make, not because it’s sensationalist but because enough people want to see the same change happen. (Nice piece on this by Kathy Oneto here)
  • Make everything a consumer touches endorsing of why they should seek you out more – and do that through being in touch with them, not through generalising about them

Put your money into those things, I suggest. There’s plenty there to be getting on with.

2 thoughts on “Is brand differentiation still possible?

  1. Interesting post! I’ve been thinking a lot about differentiation lately, much along the same lines. For sure, successful differentiation is mainly about starting with what the customer and working backwards from there, rather than trying to build something on a picayune product difference. If we can get that right, there’s plenty of difference to be found in the generic. And absolutely keep it simple, basic and obvious. My 4-part differentiation mantra these days:
    1. Change what we mean by brand (think Purpose)
    2. Change what we mean by different (think Experience)
    3. Stay tuned to the customer
    4. Think big and simple.

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