You Can’t Compete On Price Long-term. 14 Ways to Strategically Differentiate Your Brand. by Forbes – Entrepreneurs

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Really good branding is hard. The ability to craft a combination of tangible and intangible assets that can become a powerful feeling internalized by your customers is not easy. If it was, everyone would build a great brand. To be clear, there are great brands for which we believe there is no substitute and then there are commodity based products or services for which we seek substitutes based on perhaps price. Which would you rather be? Why does Apple, Nike, Netflix and Visa garner our loyalty and other companies we can no longer remember litter the “brand” graveyard? If you believe that starting a company is hard, building the enduring brand that will sustain it is harder and perhaps more important.

So, now that you are beginning to understand just how critical it is to focus on branding, and more importantly, to differentiate your brand, how do you go about it?  This is a critical phase because you can usually only launch a brand or company once. Build your brand with a mission and purpose that customers will internalize so strongly that you will differentiate your brand in the market place.

Here are some insights on how you could potentially differentiate your brand:

  • Price Differently. You can be either the economy bestseller with a low price, or a premium brand with a high price – such as Starbucks, which prices coffee higher to increase perceived quality. In fact, many brand differentiation strategies can help you charge and receive a premium price.  Tumi luggage is another great example.
  • Own a Niche and then Expand. Niche products or services have built-in brand differentiation, and the marketing for them should reflect that niche. A good example is Nike which started out just making running shoes. Once they owned that category, they expanded.
  • Be the Expert.  If your brand is the best at something in your industry, you can differentiate by focusing on your expertise. Domino’s Pizza provides differentiation through its expert home delivery and their 30-minute guarantee.

Products on a shelf.  Photographer: Laura Buckman/Bloomberg© 2019 Bloomberg Finance LP

  • Use a Mascot or Spokesperson. Brand mascots can be powerful differentiators, especially if you want to bring a sense of humor to your brand perceptions. GEICO has created massive success with its mascot – a talking lizard that has nothing to do with insurance, but still makes millions of people believe there’s something different about the company. Be careful, though, as this could backfire as it did with Subway.
  • Innovation can be a key brand differentiator. This type of distinctiveness is common for tech brands – Apple is synonymous with innovation, ease of use and enhanced life experiences. SalesForce captured a large market share with a cloud-based CRM. Uber does not have any cars but united millions of drivers to pick you up.
  • Be the Underdog. A lot of customers love a good underdog story and will connect with you through your ‘David and Goliath’ brand story. Emphasizing your brand’s humble beginnings can help you differentiate, especially if your competitors are focused on being the biggest and the best. Sir Richard Branson has launched the Virgin brand into multiple sectors with this strategy, challenging the perceived big guys and the status quo and becoming the “customer’s champion.”
  • Consistently Over-Deliver on Customer Service. With all other factors equal to your competitors, consistently superior customer service and exceeding expectations can differentiate your brand. Online shoe store Zappos commands a premium price tier because of their outstanding customer service, including free shipping and free returns. They don’t even make shoes.
  • Tell Your Unique Brand Story. Every successful brand has a compelling story behind it. Fully developing and emphasizing your brand story can help you differentiate, be core to your brand DNA, and reinforce the personality, promise and values of your brand. Volcom, the action sports brand started with a story supported with a “youth against establishment” marketing position.
  • Personify Your Product. A slightly different strategy from brand mascots, brand personification involves creating a “character” that represents the characteristics of your brand. Green Giant, which sells vegetables, has done this successfully with the Jolly Green Giant, while Keebler snacks are personified through the Keebler Elves.
  • Appeal to Emotions. Your brand can stand out by delivering an emotional experience that’s associated with your product or service. Coca-Cola capitalizes on emotional appeal by branding their products as happy, implying it’s the maker of joy and harmony. Everything Coca-Cola does from a strategic branding perspective is to associate the brand with “happy occasions.”

Coca-Cola Co. brand Coke and Diet Coke are displayed for sale. Photographer: Luke Sharrett/Bloomberg© 2019 Bloomberg Finance LP

  • Give Back. Modern customers, most notably Millennials, love to get behind a brand that gives back to the community. By emphasizing corporate social responsibility (CSR), you can differentiate your brand and get an edge over the competition such as Patagonia has done with their outdoor clothing.
  • Redefine Your Product Use. If your products can accomplish more than one thing, the alternate use can help you differentiate your brand. As an example, Arm & Hammer was just another baking soda until the brand began marketing the idea that it also made an excellent air freshener along with a multitude of other uses.
  • Provide Higher Quality. Luxury brands are able to command premium pricing through an emphasis on higher quality products – either actual or perceived. Providing luxury is an automatic brand differentiator for most markets as it has done for Coach, Rolex, Porsche and a host of other luxury brands.
  • Create a New Category. When a marketplace gets very large and is still growing, consider creating a new sub-category within the larger marketplace. This is exactly what Vitamin Water did (in the bottled water marketplace) and it benefited tremendously with its focus on its association with vitamins.

No matter the brand strategy you use, you have to create brand differentiation in your customer’s minds and have them “feel” there is no good substitute for your product or service.  If you don’t, then you will compete on price all the way to the bottom.

If you want more brand and strategic marketing insights, read my book on branding Brands and Bulls**t. 

March 8, 2019 at 10:09AM
https://www.forbes.com/sites/bernhardschroeder/2019/03/08/you-cant-compete-on-price-long-term-14-ways-to-strategically-differentiate-your-brand/
Forbes – Entrepreneurs
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