Ten Ways to Successfully Position Your Brand in Overcrowded Markets

Today, brand managers are increasingly at a loss about how to differentiate their brands. In most product and service categories, every unique and purchase motivating position has been claimed by one or more brands. Product and service categories have matured, brand research has gotten sophisticated and competitors have successfully filled all of the brand positioning niches. So what is a brand manager to do to discover a new unique and compelling brand position?

Here are some ideas:

1. Identify, create and own a new "category of one." The Strong National Museum of Play did this by repositioning its brand from a children's museum to the only museum of play. 
2. Through qualitative research, discover one or more compromises all of the brands in the category are making with their consumers and then design a business model and brand to overcome these compromises. CarMax did this vis-a-vis traditional used car dealerships and Uber did this vis-a-vis traditional taxicab companies. 
3. Choose a valued benefit that has never been a part of the category. Apple did this with the introduction of smartphone apps. Southwest Airlines did this by owning "fun."
4. Add an element to the brand that no other competitor in the category has added. Opaque did this. It introduced the concept of dining in the dark. 
5. Make an outrageous version of a traditional product. Check out Loudmouth Golf for wild clothes. 
6. Combine two or more products into one or two or more functions into one product. Victorinox Swiss Army was one of the first to do this with its knives. 
7. Focus on a niche market or on one market segment. Orvis and lululemon do this, as does Lane Bryant. 
8. Create a character that gives the brand a distinctive personality. Kellogg's Tony the Tiger was one of the first, but GEICO's gecko,  Progressive Insurance's Flo and Jamie and Pistachio's elephant, Ernie are also examples of this. 
9. Go left when everyone else is going right. Naomi Klein did this with her No Logo book when everyone else was writing about the power of brands.
10. Use a new material or technology that no one else is using. SmartSolve has created environmentally friendly dissolving paper, pouches, labels, thread, tape and adhesive. 

What do all of these approaches have in common? Out-of-the-box thinking.  None of these brands would have become what they became if their managers had applied linear or incremental thinking. 

If you are interested in this topic, here are some other blog posts that might be of interest to you:

• Branding in Highly Competitive Categories
• Differentiating on the Unexpected
• 50 Ways to Differentiate Your Brand
• 6 Powerful Ways to Differentiate Your Brand
• Sources of Brand Differentiation
• Creating "Category of One" Brands
• Creating "Category of One" Brands
• Breaking Customer Compromises
• Branding Water
• Just for Fun - The Loudmouth Brand

By the way, the Interceptor vehicle pictured above is a car, boat, plane and helicopter all in one, applying idea #6 above.

How Can Start-Up Brands Beat Well-Known Brands?

I was recently asked two related questions: Why are new no-name brands able to topple big decades old brands in today's environment? How can a small start-up brand effectively challenge older established brands?

There are so many different ways to answer this, many related to technology, but some also related to legacy brands resting on their laurels. The advent of digital photography (invented by Kodak) killed Kodak's previously highly profitable business model that was driven by film purchase and developing. This disruption was amplified by the advent of smart phones with built-in cameras. 

Uber's online platform not only revolutionized and democratized the way people can get rides but it also made it much simpler to find, hail and pay for a ride. Plus, it provided for a record of one's paid automotive excursions. This is an innovative model that is scalable and has network effects. Also working in Uber's favor is the general low level of quality of taxi service compared to the service offered by Uber drivers driven by a constant customer feedback loop. 

Though backed by a lot of money from Pay Pal's founder Elon Musk, Tesla also has made significant inroads vis-a-vis legacy automobile brands. It has done this by sheer strong will and innovation. From its vigorously pursuing the concept of a luxury all electric vehicle to its sales and marketing innovations, Tesla has taken the risks to do things differently. 

The Internet also makes it easy for smaller companies to seem bigger than they are and compete effectively with larger, more well-known companies. And the customer targeting offered by Facebook and other social media platforms makes it more cost effective to go after highly targeted customers. 

CarMax, though supported with major funding, came into existence because legacy used car dealerships did not treat customers well. CarMax saw the opportunity to make automotive purchasing easier and more transparent. Again, it relied on an innovative business model and a transformative technology, a database that can be accessed from anywhere through the Internet. 

Airbnb is another example of a brand that has used the Internet as its platform to achieve scalability. But it also is driven off of the concept of shared resources. This same sharing of resources has worked for Zipcar and Zagster.

So, in summary, these examples point to the following sources of legacy brand disruption and displacement:

• An innovative business model
• A superior model of customer service delivery
• New superior technologies
• The Internet
• Software-driven solutions
• Scalability
• Network effects
• Resource sharing
• Product differentiation
• Highly targeted marketing

Taking Risks

Southwest Airlines tried something new when it decided to create an airline based on a new low cost model and employees who were cheerful and funny. Amazon.com took risks when it created an all online mega store. eBay was also an entirely new concept. Industry insiders laughed at GEICO when it began advertising so heavily with a gecko spokesperson. Uber thought out-of-the box when it created its new model for paid vehicular transportation. Wegmans has a history of constantly trying new things and integrating them if they work and abandoning them if they don't. Tesla started a new car company based on the concept of an all electric luxury car. And they decided not to sell through dealerships. CarMax created an entirely new model for selling used cars. Abercrombie & Fitch repositioned itself from a staid century-old upscale sporting goods store to a hip clothing store targeted at the teenage market. 

Not all risks pay off. Saturn was a different kind of car company and a different kind of car but when it got integrated back into GM mainstream, it began to fail. Song Airlines, a Delta Airlines startup, was designed as a lifestyle brand targeting stylish hip professional women and focused on creating a new culture in flying. It started at the worst possible time for airlines, post 9/11.

My point with each of these brands is that wildly successful brands (and some that fail) usually step out of the box, break the industry mold and take risks. As a brand, you cannot win by doing what everyone else in your product categories is doing. 

I can't tell you how many clients have said to me, "But if we do that, we would be taking huge risks. No one else in the industry has ever done that before." I have also heard the following: "We just don't know how to do that." "That is not our area of expertise." "But then we would be entering a new product category." "Our shareholders would not allow that." "That is just too risky. What if we fail?" Gambling establishments are quick to point out that "you can't win if you don't play." The same holds true for brands. If you are unwilling to take any risks, it is almost certain that you will not stand out as a brand. In fact, every single brand that was successful over the history of commerce took a significant number of risks to achieve their success. That is just how it works. 

If you are unwilling to take at least calculated risks, your brand will never achieve the highly successful differentiation you would seek for it.

Creating "Category of One" Brands

To become a “category of one” brand is the holy grail of branding. What does it mean to become a “category of one” brand? It means that no other brand is even in the same category as your brand. Your brand has created a new category – one that matters to people.

What does it take to create a “category of one” brand? Intuition, insight, vision, risk-taking and an entrepreneurial spirit.

Here are some examples of “category of one” brands:

• The Strong (National Museum of Play)
• Cirque du Soleil (A New Form of Live Entertainment)
• CarMax (A New Approach to Used Car Sales)
• Uber (A New Approach to Paid Transportation)
• Netflix (A New Approach to Movie and TV Watching)
• Naropa University (Focused on Spiritual Enlightenment/Transformation)
• Opaque (Dining in the Dark)
• Modern Toilet Restaurant (Toilet Themed Restaurant)
• Elio Motors (Two Seat, Three Wheel, 84 MPG Vehicle for $6,800)
• Medifast (Energy Drops and Flavor Infusers)

Central to creating a “category of one’ brand is envisioning and innovating the new category. This will certainly create buzz and a huge amount of free publicity. It will also create new demand. The people to whom it is targeted will want to try the new brand. And then they will want to spread the word about what they experienced. Word-of-mouth marketing is significant for “category of one” brands.

Creating a new category also creates a first mover advantage, and depending on how fast one can scale up, significant economies of scale and network effects. This creates tremendous financial advantages for the “category of one” brand and barriers to entry for me-too brands and other subsequent competitors.

Eventually, other brands will enter the category, especially if it is large, profitable and growing. However, if your brand is the one that created the category and it scaled up fast and took advantage of the category creation buzz, it should have financial advantages and mindshare advantages.

Are there currently or will there soon be competitors to each of the above listed brands? Sure, but there will likely never be another Cirque de Soleil.

Being a “category of one” implies a fair amount of innovative thinking, product innovation, often system innovation and usually business model innovation. So “category of one” brands can even be quite disruptive. Consider Amazon.com when it was first introduced or eBay when it was first introduced or Uber today.

Brands that innovated new categories must take charge of and credit for those new categories and they must grow them quickly or they might lose their advantage. Kodak created digital photography but consider its position in that market today. Who created the smartphone category? Who owns it today? Who created the MP3 player category? Who owns it today? Is it even relevant anymore with the emergence of the smartphone category? Which brand created airport rental beds? Is that brand still dominant in the category?

Instead of trying to differentiate your brand within an already crowded product or service category, consider creating a “category of one” instead. It is more fun. It will create more buzz. You will get a lot more free publicity. And, if you do it right, your brand will grow at an amazing rate. To read my post on seven strategies to  create new business categories, click here.

We offer a full day workshop in which clients explore alternative category definitions, competitive frames of reference and preemptive brand positions to discover a potential “category of one” brand position. This highly facilitated workshop is preceded by stakeholder research. Its output is a recommended “category of one” brand position, which can be translated into a tagline, a marketing campaign and inform strategic business decisions.

Please email us about how this workshop can benefit your brand.

Disruptive Technologies and Business Models

Disruption: inducing radical and sudden change; a radical change in an industry, business strategy, etc., especially involving the introduction or a new product or service that creates a new market. 

The Internet was perhaps the most disruptive development. Timesharing was a disruptive concept in many industries. Low-cost airlines (Southwest Airlines, JetBlue, etc.) disrupted legacy carriers (United Airlines, American Airlines, etc.). ATMs made it much easier for consumers to bank 24/7. Amazon.com disrupted Borders and other brick and mortar bookstores. Some would claim that Amazon.com is beginning to disrupt Wal-Mart. eBay and Craigslist have disrupted traditional classified ads. Netflix disrupted Blockbuster. Digital photography (invented at Kodak) disrupted Kodak's film-based photography. SmartPhone cameras have changed the way people take pictures. Electronic greeting cards are disrupting traditional greeting cards. CarMax was intended to disrupt traditional used car dealers. Uber is disrupting traditional taxi service. Airbnb is disrupting the hospitality market. SmartPhones have made traditional phones obsolete. They are also making major inroads in the the markets for other computing devices.

Match.com, eHarmony.com and other dating websites have changed the way we find romantic partners. Online universities are intended to disrupt traditional colleges and universities. All-electric cars (such as Tesla) will eventually disrupt gasoline powered cars. And more powerful batteries/energy storage will elevate electricity as an energy source. Artificially intelligent medical diagnosis software is projected to radically change the role of the internal medicine doctor. Big data is radically changing the way marketing is executed. Facebook is changing the degree to which customer targeting can occur. 

Nanotechnology makes devices and components significantly cheaper, faster and more functional. 3D printing will be disruptive to many industries. Photonics is radically changing the traditional semiconductor world. Cloud services are changing the way we back up computers. Crowd sourcing is changing the way people raise money for projects. The Square and similar devices have made it much easier and less expensive for anyone to accept credit cards as a form of payment. Alta Devices is making it easier to embed thin, flexible solar panels into any device or material. 

Is your brand defined in a way that it can transcend and incorporate disruptive technologies? Or is it so linked to an approach or technology that could be obsolete that it will die with the old approach or technology? Further, are people in your organization willing to make their current approaches or technologies obsolete with the latest disruptive technology or are they fighting the disruptive technology all the way to maximize profits until the business and brand crashes and burns. This is something worth thinking about.