- Category: December 2013 - Brand Management
According to David Aaker, Vice Chairman of the strategic brand and marketing consultancy Prophet, “most brand strategists are focusing on “points of difference” (POD) that will give consumers good reasons to prefer their brand, since the key to winning is assumed to be differentiation.” “However, if there is a key ‘must have’ dimension, on which your brand is perceived to inadequately deliver, your brand will not be considered. You will not be a player, which means you have no chance of winning - no matter how compelling your point of differentiation is. It will not compensate for a fatal liability”, he concludes.
The solution: Points of Parity (POP)
While it is important to establish a POD, it is equally important to nullify the competition by matching them on the “points of parity” (POP). As a late entrant into the market, many brands look at making the competitor's POD into a POP for the category and thereby create a leadership position by introducing a new POD.
The point of parity concept provides another perspective on how to make or keep a brand relevant and you should consider experimenting with it.
There are two different points of parity (POP), category- and competition-related, whose concepts offer a different approach to brand relevance:
Category POPs are perceived obligation characteristics a brand has to provide to exist in a specific category. A bank, for example, would lose out to competitors if it wouldn’t be able to ensure adequate access to ATMs. Some German automakers have long refrained from placing cup holders in their vehicles as they were convinced that car purists would not like such distractions. But when the cup holder became a kind of standard for many clients, they finally had to follow. Jaguar realized that their brand was excluded by customers who wanted a car with all-wheel drive. When this group reached a significant proportion of car sales in key regional markets for Jaguar, the company launched a model with all-wheel drive. It didn’t have to be better than the Audi Quattro or others, but only good enough to no longer give some customers any reason to exclude Jaguar.
Competitive POPs are designed to negate a competitor’s point of difference. Many brands have, for example, the problem that their offer is perceived as inferior in quality in comparison to the competition. For instance, in the 90's Hyundai built cars of low quality. When the quality problem was resolved around ten years later, however, the customers continued to forgo the brand, as the image of poor quality stuck. It took Hyundai years, but eventually with different communication programs using a variety of channels the company succeeded to communicate the new level of quality and could catch up in this point with the competition. The quality was at least perceived as good enough to draw attention to PODs, such as price, design, gas mileage and warranty.
Another good example is McDonalds which had a competitive parity problem when it began losing customers concerned with healthy eating. So McDonalds began to offer grilled chicken sandwiches, a variety of salads and fruit smoothies, besides starting to make their signature fries with dramatically healthier fats. The goal was not to make McDonalds a destination for the healthy-eating segment, but to create enough parity to reduce the number of customers who wouldn’t even consider the brand.
Now, check to find out if your brand misses a POP in the core dimensions. As long as you do not catch up on this point with your competitors, even the most convincing POD isn’t enough. Playing the game for the game’s sake is what you achieve if you don’t meet the minimum requirements in the POPs. As a result, you won’t be classified as relevant and therefore not taken into consideration.
By Daniela La Marca