Traditional business wisdom treats brand positioning and overall business performance as two separate departments, or more like silos. Brand positioning is commonly thought to be “all that creative and touchy feely stuff” produced by the marketing department, while the overall business performance is about numbers produced by those in charge of the organization. Given the current proliferation of social media and immense consumer power, organizations are beginning to seriously rethink this traditional approach to doing business.
Instead, organizations of all sizes are incorporating consumer preferences, pricing, and innovation into their overall business strategy. Such organizations believe that brand positioning directly affects the prices and quantities sold for their products/services.
The overall goal is to build the desired brand distinctiveness that will dictate and justify the products’ asking price. For example, aspirational brands, such as Mercedes and BMW, are highly differentiated with a wide consumer appeal. Such brands command premium prices because their products are perceived as luxury goods and are highly desirable to those who want to enjoy finer things in life at a somewhat affordable price. A more mainstream brand, such as Chevrolet, would not be able to command such a high price point because its products are not perceived to have as much value or prestige.
The bottom line is that the product’s brand positioning is the core of its success in the marketplace. Organizations cannot demand premium prices for products of lower perceived value. By the same token, it is foolish and bad business to sell premium quality products at a low price. This leads to unnecessary financial losses and brand deterioration. Every business should know how its brand is perceived in the marketplace and how much such perception can garner in sales.
Here are a few tips for positioning your brand accurately and incorporate its distinctiveness into the overall business strategy:
- Determine if your brand is aspirational, mainstream, peripheral, or unconventional.
- Ask your customers to tell you how they perceive your brand and determine if their overall perception matches your vision for your brand.
- Build your pricing strategy based on your brand positioning. More distinctive brands can demand higher prices for their products/services.
- Manage your brand. Do not set it and forget it.
- Track and analyze your sales results.
To learn more about brand positioning and its effect on the overall business strategy, please email us at email@example.com.