Different propositions for different customer priorities is the key in business, as a brand name must now mean all things to all people, says Alan Mitchell
Crystal-clear segmentation and targeting, and equally precise value propositions and brand values – don’t try to build a brand without core building blocks such as these. All-things-to-all-men fuzziness, vague targeting and diffuse messages are to successful brands what George Bush is to Saddam Hussein. They’re complete opposites.
We all know this to be true. So why is it that some of the biggest, most influential brands in the UK, such as Tesco, Sainsbury’s and the BBC, flourish by routinely doing the opposite?
Take the grocers, who are doing some fascinating things with their brand strategies. Many years ago, they started flouting the rules of brand stretching and brand extensions by moving into completely unrelated areas such as petrol and financial services. Most brand experts were convinced that this was a stretch too far. Today, nobody bats an eyelid if a retailer announces a move into mobile phones, energy, cars or forecourt convenience retailing. The idea that its brand umbrella is broad enough to encompass all these things is widely accepted.
Looking inside we see something very different again. Take pricing. It’s a fundamental tenet of branding that pricing plays a crucial role in positioning. Discounting cheapens an up-market brand.
Yet, in many supermarket categories, the biggest price differential is between, for example, a Tesco value line and a Tesco super-premium. As Taylor Nelson Sofres communications director Ed Garner demonstrated at a recent Marketing Week conference on retailer brands, the own-label price differentials within the supermarkets are sometimes astonishing. Within Tesco, the price of bacon can vary between &£2.74 a kilo (value line) and &£11 a kilo (organic). Sainsbury’s baked beans can vary from 9p to 61p. Asda bread from 19p a loaf to 88p. And so on.
Own-label ranges are a key part of this huge disparity. These ranges break new ground in branding by being built around customer rather than product attributes. The Blue Parrot Café, for instance, combines many different products around a particular type of person: mothers looking for healthier food for their children. “Free From” is for allergy sufferers, “Finest” for gourmets, “Healthy Eating” for the health conscious, and so on.
With such ranges, Tesco, Sainsbury’s and others are successfully offering completely different – even contradictory – value propositions and appealing to customers with different sets of values and priorities, all under the same overall brand umbrella. Garner’s research shows, for example, that compared with the national average, 74 per cent more Sainsbury’s shoppers buying its Taste The Difference range agree with statement “I regard myself as a connoisseur of food and wine”. But among Sainsbury’s low-price shoppers, the index falls to 83 (where 100 equals all shoppers).
Those agreeing with the statement “I work to a strict budget when I’m buying groceries” index at 130 among buyers of Tesco value lines, but at 71 for buyers of Tesco Finest – where the “connoisseur” index is 187. Among Tesco value buyers, the index of shoppers saying: “I buy organic foods whenever I can” is 55 per cent – about half the national average. But among buyers of Tesco Organics it’s 452. And so the figures go on: completely different propositions for completely different customer priorities, all under the same brand.
We can see the same phenomenon with the BBC, where, depending on whether you are watching a classic costume drama, a soap opera, voting on a national IQ test, or using a BBC website to revise for exams, the same brand is offering an astonishing range of different experiences.
You could argue that there is nothing new here. With brand extensions, marketers learned long ago how to broaden their brand appeal to a wider range of segments: cheese and onion as well as plain crisps for example. As natural aggregators of different offerings, all the supermarkets are doing is taking this core business attribute a little further with their forays into telecoms, financial services and so on.
Likewise, their sub-brands are a perfect example of the power of segmentation, targeting, focus and clarity. Nevertheless, there are some differences.
The degree to which these brands accommodate a range of sometimes contradictory value propositions under the same umbrella is new. That’s because the brand works well at two different levels – the specific product promise, where branding originally came from, and an extra layer of service intention.
Marketers like to talk about brands being promises. Usually what they mean here is that a successful brand demonstrably fulfils a product-related promise. Pleasant tasting chocolate or beer, for example. But slogans such as “Every Little Helps”, “Making Life Taste Better” or the BBC’s mission of “inform, educate and entertain” are more like declared service intentions than product promises. They’re pregnant with a wide range of possible applications, and being seen to vigorously pursue them builds trust as effectively as fulfilling any specific product promise.
These “service intentions” can also add an extra dimension of inclusivity (think of Marks & Spencer’s “Exclusively for everyone”) even as their detailed implementation takes a variety of different, and even contradictory, forms. Razor-sharp clarity at the higher level of values can allow for great flexibility at the level of specific product promises. A brand which has inclusiveness at its core is much more able to embrace diversity in different manifestations.
Finally, these brand propositions treat people with respect. They acknowledge that today’s sophisticated, knowing consumer is able to deal with complexity, ambiguity and subtlety rather than needing everything reduced to its simplest form. With the supermarkets’ own-label ranges and pricing strategies, it is astonishing how quickly and easily people “got it”.
Developments like these aren’t a brand panacea. Each of these brands has its problems. But the point is that in branding there’s always a successful exception to every brand rule. And “best practice” is always essentially conservative, because best practice simply codifies yesterday’s successful innovations.