Understand Your Brand – Central vs. Distinctive

Which auto manufacturer has the strongest brand?  BMW? Ford? Mercedes?  Lexus? Toyota?  Kia? Lincoln?  How do you even decide?  And, what does it mean to have a strong brand?  Is it one that is easily recognized – easily recalled?  Is it one the commands a higher price?  Is it a brand that simply sells more?  What exactly is a strong brand and how can I compare one brand relative to another?

While questions such as these are critical to understand, they can be incredibly difficult to answer.  Recently I read an article on Harvard Business Review called “A Better Way to Map Brand Strategy.”  This article presented a simple yet powerful tool to map a brand’s “strategic sweet spot.”  This post is my summary of the article.  The map places a brand along an X-Y axis grid.  This Cartesian grid is formed by the X axis of centrality and a Y axis of  distinctiveness.

Two basic questions are asked (a survey of consumers) about the brand to plot or map the brand’s position.  The first question is centrality – how representative is the brand of the category.  Central brands are the ones that first come to mind to the widest range of people.  As an example, central car brands would include Toyota, Chevy, and Ford.

The second questions is distinctiveness.  This questions answers the degree to which this brand stands out from other brands.  Tesla, continuing with the auto example, is a very distinctive brand while Toyota, Chevy, and Ford are much less distinctive.

These two questions create four sections that can be used to describe a brand: aspirational,  mainstream, unconventional, and peripheral.

Aspirational Brands: These are brands that are both central and distinctive.  As a result, these brands typically have both a high sales volume (centrality correlates to higher sales volume) AND a higher sales price (distinctiveness correlates to higher sales price).  While aspirational brands may not develop the latest innovation, they are often the brand that launches an innovation into the mainstream.  Hybrid car technology is an example.  The Toyota Prius was an aspirational brand that helped to launch hybrid technology.

Mainstream Brands: These are brand that score high on centrality but low on distinctiveness.  The may be the ones we think of first, but they are also the same as everybody else.  Chevy and Ford are mainstream brands.  So are Pepsi and Coke.  These brands benefit from broad awareness and high volume in sales, but suffer from declining prices.  Without a high distinctiveness score, prices generally fall.  Mainstream brands need to defend against falling prices – especially against unconventional brands that can demand a higher price and from upstart peripheral brands working to become more mainstream.

Unconventional Brands: These are brands that score high on distinctiveness but low on centrality.  Staying with our car example, brands such as Tesla would be unconventional.  These brands generally are not the most well known.  But, they are unique.  These are niche players.  While they do suffer from lower volume, they can command higher price points (and therefore higher margins).  Often features that defined a brand as unconventional can become mainstream over time.  The electric car feature of Tesla is becoming more mainstream.  As this happens, the unconventional brand could run this risk of losing distinctiveness and thus price point.

Peripheral Brands: These are brands that score low on both centrality and distinctiveness.  They can often be described as “me too.”  While these brands tend to suffer from both lower volume and lower price point, their advantage can lie in lower costs.  Peripheral brands can have much lower marketing and innovation costs by simply following the crowd.  An example would be a generic alternative to a well known brand.

The HBR article described each brand in greater detail, providing strategic implications for all four brands.  I would recommend taking the time to read the entire article to help understand and map your brand.