Establishing points of parity Common misunderstanding about positioning
Establishing points of parity
Common misunderstanding about positioning • It should focus almost exclusively on differentiators Volvo (Safety) Crest (Cavity protection) 2
Reality about positioning • Differentiators alone are not sufficient • Points of parity are the minimum requirements needed to compete in a given category and can be just as important to your success as differentiators 3
Minimum requirements exist for every category Hair salons Commercial Banks • Qualified staff • Service performance • Hair styling • Checking accounts • Hair coloring • Savings accounts • Friendly atmosphere • Debit/credit cards • Convenient hours/location • Online banking • Manicures/pedicures • Loans and mortgages • Waxing • Wire transfers 4
Communicating points of parity
And the Subway sandwich chain is a case in point • Company thrust into national spotlight after college student Jared Fogle loses 240 lbs by eating a steady diet of its sandwiches • Subway hired Jared as a national spokesman for its brand • Hundreds of news stories and talk show appearances ensued positioning Subway as the healthy fast food option • Sales exploded but Subway’s ranking on taste, the primary decision driver for fast food, began to decline 6
To address this issue Subway launched a twopronged promotional campaign • Subway reinforces its great taste by promoting its most flavorful sandwiches in one campaign • It promotes its most compelling point of difference, its healthiness, through a separate campaign leveraging Jared and professional athletes 7
The combination has been very effective • Subway surpassed Mc. Donalds in 2010 to become the largest global restaurant chain • Subway growth* more than doubled the industry average from 20072013 • Subway has become the 3 rd most valuable fast food brand behind Mc. Donalds and Starbucks according to the 2013 Forbes survey * Average growth in the number of Subway franchises from 2007 -2013 8
Points of parity are particularly important to establish for new brands and line extensions The right way The wrong way • Nivea extends into deodorants • Dove extends into dish washing liquid category • Brand promise – Gentle & protective • Focuses on two messages – 24 hour protection – Gentle & protective • Outcome – Nivea establishes presence in deodorant category – Moisturizing • Focuses on one message – Softens hands while you do the dishes • Outcome – Dove fails to gain acceptance and exits market 9
Points of parity change over time
Short history of the shaving market 11
Enter King Gillette • Straight razors required continuous sharpening • His disposable blades eliminated the task of sharpening • Pioneers new business model for disposable products • Launches continuous stream of innovations King Camp Gillette 1855 - 1932
Evolution of razor requirements Gillette Blue Blade 1902 -1938 Gillette Aristocrat 1934 Gillette Adjustable 1958 Wilkinson Stainless Steel blades 1962 Wilkinson Plastic shaver 1970 Gillette Trac II Double blade razor 1971 Gillette Atra Pivoting Head 1977 Gillette Sensor Spring loaded blades 1990
Evolution of razor requirements, ctd. Gillette Sensor for Women 1992 Gillette Sensor 3 3 blades 1995 Gillette Mach 3 Anti-friction blades 1998 Gillette M 3 Power Vibrating razor 2002 Gillette Fusion 5 blades 2006 Gillette Fusion Pro Glide Flexball 2014 Schick Quattro 4 blades 2002
Examples of one-time differentiators that became minimum requirements • Fluoride toothpaste • Online banking • Antiperspirant • 6 -hour laptop batteries • Cup holders in automobiles • Frequent flier programs • Anti-lock brakes • Platinum credit cards • Next-day package delivery • DVRs with skip forward feature • Made to order computers • Cell phone cameras • Low calorie drinks • Cell phones w/ web browsers 15
Summary • One of the most common misperceptions about positioning is that it should focus almost exclusively on differentiators • Points of parity are the minimum requirements to compete in a given category and they can be just as important as differentiators • Points of parity must be communicated repeatedly to prospects in order to maximize receptivity to your offer • Points of parity are always evolving so brands need to keep pace and when necessary develop new sources of differentiation 16
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