By Mubarak Sooltangos
There are different ways of promoting the sale of a product. A great proportion of market leader products sell more than their competitors because they have a price advantage when compared with similar products on the market. Others sell on the basis of their quality, the scope of their usage, their performance, their durability, their low running cost or the availability of good after sales service. Food items sell on consumers’ “acquired taste”, their nutritional value, their healthy ingredients and their low price when they are unbranded and sold as commodities, like cereals, pulses and rice.
All producers will endeavour to place on the market products which satisfy as many of the above conditions as possible to sustain and increase their sales. But fundamentally, smart business is not about continuing to increase volume sales year on year and to gain market share. This state of mind is most of the time driven by sheer vanity. The useful end product of any business is the “bottom line”, and this is sanity. There is a further goal for smart businessmen. At the end of the day, whatever the level of sales or net profits produced, the ultimate “reality” is the amount of cash generated. This is what allows a business to have a forward view, orientated towards growth, new investments and diversification to increase its critical mass and make it less vulnerable to changing business conditions. Furthermore, it allows it to keep cash in reserve to face any contingency or to grab any business opportunity which may present itself.
What is a competitive edge?
All the intrinsic advantages of a product listed above are termed “competitive edges”. At the core of marketing skills, lie the ability to create competitive edges with regard to competition and to package them intelligently for communication to the target market, using the language and the media with which the customer relates the best. There are several key words in this statement and each one is equally important: competitive edges, packaging the selling points, target market and communication.
With few exceptions, all leader or respectable products have strong competitive edges: Mercedes Benz has design, robustness and security, Omega has durability and dependability, Toyota has value for money on several counts, DHL has, over and above rapidity of service, reliability linked to its tracking possibilities for the customer. These are all strong and tangible competitive edges. Some big brands have weak competitive edges and yet are world leaders, like Tic Tac and Kit Kat.
Some among the absolute stars have no competitive edge whatsoever and yet are monuments. An example is there is little difference between a Gillette and a Christian Dior after shave lotion apart from the highly subjective element called fragrance. Comparing the fragrance of Gillette to Dior is like comparing a Mona Lisa to a Van Gogh, where there is absolutely no benchmark. Christian Dior’s Eau Sauvage after shave lotion sells at eight times the price of a Gillette of the same product volume, and the Gillette after shave suffers from no measurable or visible flaw, like being medically harmful to the skin or having no feel-good factor.
Another commercial monument not having a concrete competitive edge is Coca Cola. Compared to Pepsi Cola, it has equivalent taste which can switch customer preference either way, is equally fizzy and has exactly the same visual attributes. For decades Pepsi has been lagging behind by a distance, while selling at the same price as Coca Cola. Why?
The notion of brand image
If leader brands sell equally well on strong, weak and inexistent competitive edges, where is then the real secret to successful selling? It is a virtual, incorporeal and sometimes volatile element called “product image”. If some leading brands can sell on weak and inexistent competitive edges, there is not a single branded product which can sell above others, and sometimes at a higher price if it has no image.
For a successful product, its image is its positive perception in the mind of a customer that it somehow stands out, and is different from its competitors. By communicating the competitive edges of a product, this creates an image, sometimes called a brand character. By being consistently faithful to its promise of offering competitive edges, and continuously communicating them, the image is maintained. After a time, communication can be slowed down when the product has acquired high visibility in public and an unbeatable customer loyalty, which keeps the image and the remembrance of the product at all times in the minds of customers.
High-end customers have aspirations of their own.
Image can also be created out of nothing for a product which has no tangible competitive edge, provided it is of acceptable quality. The image of Tic Tac rests on its visual attributes only. It has a unique flip top box and a dispenser where the box lies slanted and not straight. This visual image cannot, and need not be communicated by advertising, but the dispenser is present at cash tills in all snack and grocery shops in the world, and this ensures visibility at no cost. When we realise that Tic Tac compels us to buy a box of 50 pieces when we have an urge only for a few, we will understand the power of a brand which has an image. Yet, Tic Tac is a low-tech product which does not require sophisticated and expensive machinery. The image of Orangina and Toblerone chocolate are also exclusively built on their packaging which stand out as being different, although they have no palpable competitive edge.
The Coca Cola miracle
The image of Coca Cola is built on even thinner ice. Its manufacturer sells a drinking sensation which is not palpable, not explained but driven into the minds of people. The genius in this is to be able to sell a sensation which the customer cannot even describe. If a customer survey was carried out on what this sensation exactly is, there would be as many replies as there are drinking sensations in the world for any carbonated drink. This means that each drinker of Coca Cola enjoys a drinking sensation of his own imagination, which is different from that of every other drinker. The genius does not lie in producing a sensation, because even the Coca Cola manufacturer would not be able to explain what this sensation is. The genius lies in the selling of the illusion of a sensation which cannot be described and which is not common to all customers. Hats off.
Good products with no image
At the other end of the spectrum, there are countless very good products in the world, with palpable competitive edges which never acquire an image which would allow them to become meaningful players on the market. This is because they do not communicate their exclusive competitive edges.
Volvo is an example. On the basis of its good quality and reliability, it should be in the same league as Mercedes, BMW and Audi, but it lags far behind. On our local market, I have had the privilege of launching Dairy Vale yoghurt 20 years ago against a dominant market leader. Everybody who can make a taste differentiation will recognize the superior taste and “delectation sensation” of Dairymaid which is head and shoulders over its competitor. On the market however, it is at a distance behind its competitor because its producer does not communicate its definite competitive edges. It has in it the potential of being a market leader, but this potential is not optimized by advertising.
How image is destroyed
We have seen how an image is built, but it can also be destroyed over time or sometimes instantly. If a good product enjoying a sound image enters the funny game of having lapses in quality, poor customer service, unavailability of after sales service or spare parts, frequent and reckless price increases and frequent out of stock situations or loss of visibility, it stands to lose its image over time. The damage can also be rapid.
There is still a long way to go before artificial intelligence beats gut feel and business acumen.
For example, when Parker Pens, once a dominant high-end product, introduced a cheaper version of its product, with the same visual identity but destined to the mass market, it lost in a few years its appeal to the upper end market because it no longer gave its loyal customers the opportunity of making a statement that they were special and affluent people. This was a serious marketing mistake which overlooked the fact that high-end customers have aspirations of their own, and one of them is not to be considered as forming part of the mass.
In our own country, Everyday Milk, produced by Nestle, the food giant, which had undivided market dominance for 70 years was destroyed in 18 months and suffered the humiliation of having to be removed from the market following the outbreak of mad cow disease in the United Kingdom some 25 years ago. Its misfortune was that, for years, it had heavily advertised, with a view to establishing an image of reliability, that the product was of UK origin. The image of Boeing is in danger of being destroyed with the series of technical faults which have been brought to light in its 737 version, and this creates a fear factor on which air travellers as well as airlines are not prepared to compromise.
Building image in real and varying situations
I have personally built a career on constant image building which has raised practically all my products to market leadership. Here are a few names of my real winners in the image and market leadership league in my business driver days: Sony, Zanussi, Kelvinator, Casio, Barilla, Flora, La Vache Qui Rit, Ceres, Red Cow and Biscuits LU. The systematic image building was done in a sustained manner not to bring merely volume sales, but hefty profits, because this is the ultimate business reality that matters. After a few years in the business, my Group CEO at that time told me that winning market share, increasing gross profit margin and bottom line at the same time is a rear feat in business by any standards. I hasten to say that he was closely associated with this remarkable achievement.
It was sheer pleasure juggling with innovative marketing tools and ideas on a purely instinctive basis because I had never read a business book in my life, and I joined production and trading business with no previous experience at all. This apparent weakness in fact served me well, because it allowed me to manage businesses without any à-priori, with no preconceived ideas, and this prevented me from getting lost in the beaten track and being an eternal follower. This serves to prove that above methods, systems and common conventional wisdom, successful business is based on instinct, subjectiveness and cartesian analysis of a given business situation. There is still a long way to go before artificial intelligence beats gut feel and business acumen.
The world belongs to brands
The following is a universal truth: The world belongs to brands, not to companies. If we try to figure out why the Unilevers, the Nestle’s and the Procter and Gambles of this world never use their company names as brand names, we will see this universal truth. As for image, we just have to realise that, decades ago, a Walkman did not need a Sony name in front of it, a Mini never needed any Austin or Morris signature to make it sell, an I-phone today does not need the umbrella of any Apple company. At the other end, a Galaxy needs to be preceded by the Samsung name to be recognized as a phone, and Huawei, the market leader, is just like a generic product with a name that does not say much.
Something irresistible attracts the affluent customer to the I-phone, and this something is called brand image, which is rarely the product of accident or luck. This also explains why Apple, with a 20% market share for its I-phone in the mobile phone market, was the first trillion-dollar company in the world in terms of market capitalisation.
Advertising must be centred around the competitive edges of the product.
Finally, we would gain by remembering that the brand Frigidaire was once a generic name for refrigerators in general, that a housewife in the UK some 50 years ago never vacuum cleaned, but hoovered her carpet. These examples will always carry the message that brands, with smartly built images on concrete or sometimes no visible foundation, will rule the world for many years to come and will always be cash cows if well managed.
Successful image building is made by a mix of business techniques: constant observation to know what is happening on the market, how customer taste changes, what are the innovations introduced, what are the battle horses, the strengths and weaknesses of competitors, how to create competitive edges for the product, researching what is the market segment which most likely to appreciate and buy the product, and finally, communicating with this target market, using the media the most visible to the end consumer. Advertising must be centred around the competitive edges of the product and expressed in a language which appeals to the customer. If all this is judiciously done, an image is created for the product in the mind of the customer, and this incites him to buy the product, even at a price higher than that of competitors.
The underlying reason for which an affluent customer is ready to pay a much higher price for a product which has an image is that he is driven by subjective motives, namely that of making a statement that he is different from others and he will settle for nothing less than the best product. The key in securing such a customer is to convince him that the product is the best on the market, and continue harping on this, even if it is not, from a strictly value-for-money perspective, the best offer available on the market.
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