The Battle

Brand Relevance vs. Brand Preference

In my current research on some marketing topics, I found a really interesting quotation, by  David A. Aaker in his scientific article    “Win the Brand Relevance Battle and then Build Competitor Barriers“, California Management Review, Vol.54, No.2 Winter 2012, pp. 43-57:

“The only way to achieve real growth is to develop offerings so innovative that they create new categories or subcategories making competitors irrelevant(…)!“

Image

THE BLUE OCEAN 

Referring to the Blue Ocean Theory what means offering a new product or service on a new market, as depicted in the following table:

INNOVATIONS – TRYING TO TURN THE WORLD UPSIDE DOWN?

A lot of people probably think that innovations have to change the world. But innovations refer to certain solutions, David A. Aaker talks about innovations with  “must have features“ that are for example:

1)   personality

2)   organizational values

3)   social programs

4)   self-expressive benefits

5)   community benefits

ASSUMPTIONS

But of course, no theory without  assumptions.

Each of those benefits has to be appealing to a certain segment – offer unmet value propositions.

WHAT IS BRAND PREFERENCE?

The way he defines Brand Preference is very well illustrated in this picture

RIGHT, basically a waste of money!

Brand Preference appears in dimensions like: fast, cheap or well-done and you just can be two of them at one time.

So your brand is either more attractive, more reliable or less costy.

Thus marketing only happens as: MORE effective ads, MORE promotion, MORE sponsorships, MORE social media activity…and so forth.

This is very expensive, especially because investments in Brand Preference almost never move the marketplace in the long run.

WHAT ELSE IS LEFT TO DO?

So how to become relevant? First it is necessary that the right category has to be selected , so the brand gets visible & credible – creating value for the consumer.

As a conclusion, competitors are irrelevant.

Image

RELEVANT TASKS

Nevertheless, the Brand Relevance battle has 2 important tasks:

1) First task

The new category or subcategory needs to be…

 a) managed b) understandable c) visible  and d) appealing

2) Second task

The category or subcategory needs to win – otherwise the whole strategy fails!

ANYONE CAN DO THAT – RIGHT?

But thinking about reality, some doubts came to mind…

What kind of person could create a new successful category? What character traits are essential?

You need to have a sense for changes in the marketplace and customer, a certain creativity and  ability to bring the  new concept to the market, willingness to take risk  – going out of the comfort zone!

This comfort zone means: existing target markets, existing value propositions and known business models.

HOW TO GET MONEY?

To tell the truth, getting monetary resources becomes increasingly difficult.

Not to forget, timing is a very big deal. Looking at the willingness to invest nowadays after Financial Crisis & EU Sovereign Debt Crisis starting from the US and resulted in whole economies going bankrupt and their citizens hiding money under their pillows  – showing the tremendous interconnectiveness globally.

THE QUESTION IS…

Isn’t the Blue Ocean left untouched for a certain reason? And when the innovative idea is seen as a fancy one, doesn’t the market turn red instantly OR even worse not just the same idea but combined with a better concept?

WHAT IS NEXT?

In which direction do we move, when it comes to new, innovative things?  Is there any chance to spur investment?

Please, feel free to comment…      

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One comment

  1. Hey,

    very nice post, the pictures make it quite easy to get the meaning of the post. Marketing to me, sometimes is lots of Bla Bla.
    The quote by David A. Aaker “The only way to achieve real growth is to develop offerings so innovative that they create new categories or subcategories making competitors irrelevant(…)!“ – falls partially in the same category.

    What is “real” growth? And cant you be “really” successful as well if you have an offering that is not innovative, but minimizes or simplifies an existing product or service?
    Instead of expanding you just go into the other direction..making a service simpler..

    In the first semester we had a case-study of Pure Digital Technologies, a company that was not the leader of its industry, just a follower, producing single-use cameras. At some point they wanted to test a new camera, a real camera, but they discovered that they wouldn’t be able to compete with the big players in the industry such as Nikkon and Canon. Basically they would not have been able to produce a better camera, even if they wanted. So they decided to produce a WORSE one.
    In 2005, some of the methods of producing average videomovies, were quite cheap and because of the fact that every other company was obsessed with using the newest and most-up-to-date technology, basic technology with average-result-producing videomovies, was quite affordable. It was small and easy to use and therefore the right fit for the youtube-generation. With the Flip-Ultra: http://support.theflip.com/de-de/home
    the company was soon the market leader in their segment. Within 5 years it grew enormously and was bought by Cisco in 2009: http://www.cisco.com/web/about/ac49/ac0/ac1/ac259/puredigital.html
    Just felt like contributing the story, as it explores a different sea than the “blue one”.

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