December 08, 2014
Better product or better brand.
Is it really a choice?
According to Al Reis having a better brand is better than having a better
product. Overall, I agree with him. However, I think the balance is shifting –
particularly for products or services that are subject to intensive scrutiny and
search.
Reis is right that all too many people get fixated on product innovation as
the sole means of gaining competitive advantage. No argument there. And
everything in life is perceptions. Yup. A better product alone will not
guarantee success. Agreed. So where do I find cause to differ? When Reis
states,
'It's better to be different than it is to be better.'
Far be it from me to downplay the role of differentiation in brand success
but do you really think that different is better than better? No. You need your
brand to be different and better (in some way). Why the 'in some way?' Because
your advantage might not be product-based. It might be that your brand is simply
more salient or more likeable but unless you have an OK product, one that
delivers a good experience, you are in trouble no matter how different your
brand might be.
Very few people can tell the difference between a beer, cup of coffee or
(insert packaged good of your choice) if you serve it to them without the brand
name. In days gone by, when I was young and it was legal to give people too many
beers in the name of research, we had to conduct double, blind, paired
comparison testing in order to understand whether stated preference was real or
random. When tested blind the majority of people invariably switched their
preference between two rounds of beers even though the beers they were trying
were the same. But stick a brand name on the glasses and preferences suddenly
stuck.
I would argue that this is not the case with higher risk, more considered
choices like financial services, automotive or durables. If people want to know
something about a product the information is available online and people check
things out before buying. I am not suggesting that people can really work
through all the specifications to make sure they make the 'right' choice. They
can't. They can, however, be strongly influenced by advice from friends and
expert or peer reviews.
So how do you gain competitive advantage in an environment where product and
price specifications are readily available? First, make sure your product meets
the needs of your target audience. It does not have to be the best at everything
but it does need to be good enough so that it does not get panned in reviews.
Then figure out what aspect might make your brand meaningfully different to the
target audience: is it a specific aspect of the product or is it something less
tangible? There are a million and one ways to differentiate a brand, the trick
is finding the one that will make your brand the right choice for its audience.
Then make your brand as likeable and salient as possible, predispose people to
want to buy it.
Author: Nigel Hollis, Executive Vice President and Chief
Global Analyst at Millward Brown Published: Millward Brown
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