For want of an academic reference, I am going to use an idea that has somehow entered my mind which I will call a ‘selection set’. I am sure I heard of it somewhere, but the web doesn’t lead me anywhere.
A consumer makes a choice from a variety of brands within a subcategory. Fast food is a good way to illustrate the idea. A consumer may want fast food. Their choice may be burgers, chicken, pizza, to name a few styles of food.
The range of choice may be deepened by whether the outlet is a takeaway, or if it is a sit-down, proximity to the consumer, cultural attitudes, lifestyle preferences, even available parking.
The range of choices that satisfies the consumer’s preference is the selection set. The set is also the terrain in which multiple brands must compete for space in the consumer’s wallet. The tasks of the brand manager are to understand the broad selection set and competing individual brands in the set, ensure that their brand has the appropriate degree of parity in the group, then come up with a differential and position that favours the brand in the mind of the consumer.
The methods of achieving an effective differential are as diverse as the facets of consumer preference Their identification and ranking will probably devolve to aggregates, significant data clusters and gut feel. It’s a matter of operational creativity and calculated long-term feasibility. Note the use of ‘long-term’: a promo is short-term and may be expensive.
The differential matrix and positioning statement, based on the work of Al Ries and Jack Trout, is a very useful tool for broadly defining, codifying and managing the differential. By codifying it, the management principles can be formalized, and the differentials and position can be tracked, managed and evolved. The position must also be correlated to the enterprise’s purpose in its corporate philosophy.
The method of setting up a differential matrix is easy enough. Set up a two-by-two table and proceed to codify your differences thusly…
In the top left cell place the headline ‘Who?’ Use this block to note the characteristics of the appropriate consumer. Using the fast food example, it might be parents with kids, a single person or an employee. The definition of the person excludes parts of the market, which makes for more focused marketing.
In the top right cell, describe ‘Why?’ The parents might want to treat their kids or escape from household drudgery. The single person may not be able to cook. The employee may need a quick snack to recoup energy lost during the working day.
In the bottom left cell, your title is ‘When?’ The parents might decide on a meal with their children when there is a need to escape the chore of an evening meal, or a desire to treat the children. The single person would use the outlet several times a week to avoid cooking. The employee would likely use the outlet over lunch or for a midday snack.
These three cells, ‘who, when and why’ define the position you will want to occupy and will be distilled into the positioning statement.
In the bottom right cell, name and / or describe competitors. Observing your competitors and their positions will give you the ability to validate your position in terms of your differential or evolve it depending on the degree of parity.
As you will be able to tell, the differential matrix and positioning statement are immensely powerful tools across the board. They will guide operational management, communication and inform corporate philosophy and strategy. It’s also a major contributor to the bottom line.
I have referred to parity several times in this article. It’s an important element of strategy that runs parallel to differentiation. I will explain it in the next article.
*Pierre Mare has contributed to development of several of Namibia’s most successful brands. He believes that analytic management techniques beat unreasoned inspiration any day. He is a fearless adventurer who once made Christmas dinner for a Moslem, a Catholic and a Jew. Reach him at pierre.june21@gmail.com if you need help.
