“People don’t purchase products; they buy brands,” as the old business saying goes. The key to a company’s concrete identity and market trust is branding. Take Nike for example. The materials used to make a Nike sneaker are only worth a couple of dollars. But once Nike adds their logo to these shoes, people are willing to pay hundreds of dollars for a pair. A successful brand strategy is important because it feeds the perception that a company’s products and services will consistently produce the same desired results time after time. How can you formulate a brand strategy that will captivate your market?

 

When it comes to branding, it is an advantage to establish influence and originality. Even so, marketers frequently struggle with highlighting their brands’ uniqueness while attempting to be at the centre of their sectors. This makes envisioning a good brand strategy and positioning challenging. Every decision affects not only how the brand is perceived, but also how much of it is sold and at what price—and, eventually, how profitable it is.

 

In this article, we will explain why brand strategy and positioning is important and show how a distinct brand can dominate its sector at the same time. We present a valuable basis for brand strategy, the centrality-distinctiveness (C-D) map. By utilising this tool, we can identify four brand positions and their strategic implications. We argue that the C-D map can help managers determine their desired market position, decide on resource allocation and brand strategy, as well as track performance against competitors, and evaluate strategy based on results.

 

At Taylor Wells, we believe that a good mix of brand prominence and distinctiveness will yield the best outcomes for your company. By the end, you’ll know how to better position and manage your brand for higher profitability.

 

 

Why Brand Strategy and Positioning is Important: Creating A Sensational Identity For Your Business

 

A brand strategy is a set of approaches set to achieve long-term objectives. To elaborate, brand strategy is important because it eventually results in consumer identification and preference for your brand. IKEA is known for its brand slogan, “To create a better everyday life for the many people.” This tagline effectively conveys the company’s values and objectives that appeal to its customers. How about you? What is your brand strategy?

 

Let us first define and differentiate two important brand features: prominence and distinctiveness. Then we start building our brand strategy using the C-D map, the first tool that enables businesses to directly link a brand’s position on a perceptual map with outcomes such as sales and price. From here, we can discover several alternative branding strategies.

 

Elements of a Successful Brand Strategy: Prominence and Distinctiveness

 

Prominent brands influence consumer preferences, pricing, and the pace and direction of innovation in a sector. Coca-Cola in soft drinks and McDonald’s in fast food are examples of prominent brands that best represent their category. They’re the first ones that come to mind, and they serve as starting points for reference.

 

Distinctive brands, on another hand, stand out from the crowd. Tesla in cars and Dos Equis in beer are two examples. These brands prevent direct competition from prominent brands.

 

Now, let us proceed to how a C-D map can help you have the ideal concoction of prominence and distinctiveness.

 

 

Mapping A Successful Brand Strategy

 

First and foremost, constructing a C-D map of a brand category is a simple but time-consuming process.  Here’s how you can craft your C-D map efficiently:

 

1. Determine your geographic market of interest.

 

The market of interest can be an entire country, a region, or a single city, as long as it reflects the customer groups you would like to consult. The placement of a brand on the map is dependent on these variables.

 

2. Survey to gather data on consumers’ perceptions of the brand’s prominence and distinctiveness (on a scale of 0–10).

 

Prominence refers to how brands represent their categories, like how McDonald’s embodies fast-food chains. While distinctness is the degree to which they stand out from the crowd, just like Tesla in the car industry.

 

We use this data to determine the coordinates for each brand’s position on the map. Moreover, this helps companies make cross-category and cross-geographic comparisons. Marketers can make critical judgments such as “This market has more distinctive brands than the other.”

 

3. Organise your map into quadrants.

 

The C-D map connects consumer perceptions of brands with their commercial performance. It consists of four quadrants each labelled as:

 

  • Aspirational, for the upper-right quadrant. We list brands that are extremely diverse but also have a broad appeal here. In the car sector, for example, this quadrant corresponds to 30% of unit sales and includes powerhouse brands such as Mercedes and BMW. 

 

  • Mainstream, for the lower-right quadrant. Here, we list the brands that are typically the first to come to mind when consumers think of the category. Their lack of uniqueness lessens their pricing power, but they are immensely popular and are commonly prefered by consumers. For cars, mainstream brands consist of Ford and Chevrolet. They account for approximately 44% of sales;

 

  • Peripheral, for the lower-left quadrant. This is for brands that are unlikely to be the first choice or top of mind for the majority of consumers. For cars, two examples are Kia and Mitsubishi. They account for 24% of all car sales. Many peripheral brands succeed despite their low prices and lack of distinctiveness; and

 

  • Unconventional, for the upper-left quadrant. This group contains brands that have distinguishing characteristics that set them apart from other products. Consider Tesla, Mini, and the Smart car, all of which deviate in some way from the conventional definition of a car. These brands account for about 2% to 4% of total sales.

 

See the figure below.

 

why brand strategy is important

 

4. Plot the brands. Use shapes, preferably circles.

 

How do prominence and distinctiveness affect key factors such as sales volume and price? Let’s make use of car markets for example. Below is a C-D map for cars for both sales volume and price. We can observe that circles are drawn according to brands’ performance on the two mentioned financial metrics.

 

why brand strategy is important

 

Why Successful Brand Strategy is Important: Prominence and Distinctiveness’ Impact on Sales Volume and Price

 

Sales volume refers to the number of units sold within a financial period. In car markets, the higher a brand’s prominence score, the higher its sales volume. Toyota, the brand with the highest score on this metric, was the only one to sell over a million passenger cars for a financial period.

 

Many factors influence sales volumes, and for many companies, shifting position by one point would entail massive investment in R&D, marketing, and other resources. However, we cannot ignore that increasing prominence is a key strategic goal for highly distinctive and expensive brands, like Tesla.

 

Increased distinctiveness, on the contrary, is associated with lower car sales volume, though the impact is less remarkable. According to analysts, increasing a brand’s distinctiveness reduces annual sales. For instance, a car manufacturer could sell 144,000 fewer units.

 

Why do so many brands go for the crowded higher-distinctiveness quadrants if higher distinctiveness results in lower sales? Let’s get into the next metric, price. The truth is that brands with a distinct identity can command higher prices. Consequently, a one-point boost in distinctiveness is associated with an average retail price increase of $12,900 per unit. Porsche is one example, as it is the most distinct car brand according to the C-D map, garnering the highest average base retail price.

 

 

So let’s say, after the rigorous process, you managed to synthesise your gathered data. You are finally done with your C-D map. We can now proceed with how you can use it for enhancing your brand strategy.

 

 

Why Successful Brand Strategy is Important: Implications of Brand Positioning

 

The key for aspirational brands is to keep their distinguishing traits mainstream enough to appeal to a broad audience without being cliched. Toyota’s Prius was the first hybrid car to hit the market, it rose to prominence, opening the way for additional brands. They just have to defend their position against competitors.

 

Mainstream brands achieve their prominence by carefully developing products to match public tastes. Coca-Cola, for example, saw a shift in preferences for less sweet and carbonated beverages. They influenced the market with its diet brands and then with its Dasani water brand.

 

On the other hand, unconventional brands occupy a distinct market. Their business strategies must be for low-volume profitability. For Tesla and Stella, a sensible plan would be to go from the unusual to the aspirational sector. This would boost sales volume without sacrificing uniqueness.

 

Meanwhile, peripheral brands may try to change their positioning by introducing unique features or initiating advertising campaigns, but this is a difficult and costly battle. Hyundai, for example, has added extended warranties and luxury vehicles like the Genesis and Equus. These moves have increased sales volume, but they haven’t changed Hyundai’s position, not far behind its sister brand, Kia, and second-tier Japanese brands like Mazda.

 

Those are the strategic implications for each of the brand positions revealed by the C-D map. Have you identified yours? If so, then it’s time to concentrate on your brand strategy.

 

 

Successful Brand Strategy and Positioning Examples Using the C-D Map

 

C-D maps bring a lot of advantages. It offers solution to all the reasons why brand strategy is important. Here are 5 situations in which C-D maps can help you formulate the best brand strategy:

 

1. Evaluating your brand’s positioning strategy.

 

Often, managers believe that a marketing differentiation strategy distinguishes their brand in the minds of consumers and is responsible for its sales. Gauging customers’ perceptions of a brand’s distinctiveness and statistically relating that to performance offers a fast check on the potency of a strategy.

 

For instance, if the agenda is to maximise price, but the brand is becoming more mainstream for consumers, the C-D map will indicate the gap between strategy and objective. The tool can then be used by businesses to determine whether strategy alterations are yielding results in business performance.

 

2. Keeping track of the competition.

 

Classic maps are typically used to assess consumer perceptions of specific product characteristics. A map, for example, may rank car brands based on engine features. Neighbours on such maps, however, are not always competitors.

 

This type of challenge is resolved by C-D maps, which reveal a brand’s location relative to others that reflect consumers’ conceptions of the category. This assists in focusing competitive efforts on real rather than perceived competition.

 

For example, managers of the Lincoln brand may be surprised to learn that their brand is more closely associated with Chrysler than with Cadillac in the minds of consumers. Additionally, while Dodge and Chevrolet may regard themselves as competitors, C-D maps indicate that consumers perceive significant variations.

 

3. Managing your brand portfolio.

 

C-D maps are useful because they can be created for any brand in any category. This enables businesses to compare brand performance and strategy across sections. As a result, a company selling different brands of various products could use the maps to objectively allocate resources across categories.

 

Let’s take a break from car manufacturers and look at the consumer goods conglomerate Unilever as a better example for this case. Assume they wanted to boost sales of two non-dominant brands in the US market: Tigi in hair care and Degree in deodorants. Using a C-D map, they can estimate the amount of marketing resources to allot to each brand to attain a goal, such as a specific increase in prominence that would result in an increase in sales volume.

 

The C-D map would not only help Unilever standardise and rationalise budget allocation throughout brands, but it would also allow the company to track how efficiently budgets were utilised by measuring how far the brands moved on the maps.

 

4. Looking after global brands.

 

Countless enterprises that attempt to oversee global brands in a systematic format are frustrated by market differences. In this regard,  C-D maps enable the visualisation of varying consumer perceptions and performance across markets.

 

Consider the brands Chevrolet and Tide. Both brands are extremely popular States, but they rank relatively low in terms of prominence and distinctiveness in emerging markets such as India. The ability to detect these disparities is helpful on three levels.

 

For starters, it assists a company in setting realistic goals for a global brand across markets. Second, it contributes to the understanding of variations in cross-border performance. Finally, it assists global managers in making decisions regarding brand standardisation versus localisation.

 

5. Tracking and analysing outcomes.

 

Managers frequently find it a challenge to measure the effectiveness of their efforts on consumer perceptions. C-D maps track two dimensions: prominence and distinctiveness, which are common to all brands and remain relevant over time. Marketers should be able to gauge how their actions affect consumer perceptions by continually tracking the position changes that result from promotional campaigns.

 

Organisations, for example, should relate pricing instabilities, such as E-reduction Trade’s in brokerage fees, or targeted advertising campaigns to brand movement on the C-D map to gain insights into what stimulates consumer perceptions and brand performance. The more frequently mapping is performed, particularly in categories with high levels of innovation and market churn, the clearer the evaluation.

 

 

Bottomline

 

The quadrant a brand occupies on the C-D map reflects the firm’s strategy, functionality, and market nature, but that position is not fixed. Companies may, if necessary, relocate a brand’s location—for example, to exploit less crowded territory or to increase sales. Unconventional brands, such as Tesla, may aim to be more prominent in consumers’ minds in order to gain market share. While Peripheral brands, like Kia, may see opportunities to become more mainstream. C-D maps ensure that investment pays off by enabling a company to review a brand’s strategic position, assess the risks and rewards of shifting it, and track progress over time.

 

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