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The Branding Process - 3 Keys to Brand Development!

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By Roger Griffin, Associate Partner
FOCUS Business Marketing Intelligence

Segmentation, Differentiation and Positioning

Over the next 3 months, we’re going to look at 3 of the most important considerations you will need to explore and define in your development of a successful brand.

1. Segmentation: WHERE to compete
2. Differentiation: HOW to compete
3. Positioning: WHERE & HOW to position your Brand

This month’s segment:

Segmentation: WHERE do you want to compete?

Whether you’re in hospitality, retail, manufacturer or service industries, you need to clearly identify what segment of the marketplace you’re going to compete in - where you want to play.

For example, if you want to compete in:

• The Price/Quality segment, you’re going to focus on: luxury, up-market, mid-market, mass market, or community market.
• Distribution/Selling channel, you’re going to concentrate on: specialty stores, department stores, mass merchants, discounters, or category killers.
• Market locations, you’re going to operate in: urban, suburban, or rural areas; shopping centres or main street, all or none of the above.
• Media markets: will your products or services be offered via print, radio, TV, direct-mail, catalogue, Internet, or door-to-door?
• Sales Service strategy: are you going to focus on full service, self-service, or some combination of the two?
• Product and service category offerings: what is the actual mix of products and services that you are selling and does it fit with your other segments?
• Competitors: identify your competition - direct, indirect, and verbal. Don’t forget that other products and services are also targeting your core customers.
• Customer user levels: never, rarely, occasionally, regularly, frequently, heavy users.
• Multi-channel strategy: "bricks-and-mortar", e-commerce, catalogue, a mix, etc.
• Customer segmentation: demographics, psychographics, store/usage attributes and benefits. Customer segmentation aggregates the total market into segments which share a common set of values and beliefs that they hold as being important and relevant to their needs and wants.

Your chosen Customer Segment:

• Must have the collective spending power to ensure that you meet your financial goals;
• Must be accessible to and measurable by both mass and direct media;
• Must have the appropriate demographic profile for your Brand: age, income, education, marital and family status.

Don’t stop there. With your basic Customer Demographics in place, go deeper into your customers’ values, attitudes and lifestyles, including:

• Key attributes and benefits that customers desire from the products/services/stores they use;
• Shopping behaviour, e.g.: high value, occasional, or one-time shoppers;
• Geo-demographics, e.g.; where they live, work, shop, and visit.

Retail Customer Segmentation divides your customers into 2 basic groups:

• What the customers are:
  1. e.g. Demographic characteristics;
  2. Socio-economic characteristics.
      
• What the customers think and/or feel:
  1. About the stores they shop in;
  2. About the products they use or services they buy, and
  3. About their lifestyles and behaviour.

When you’re setting up a comprehensive Branding program, your most relevant form of aggregation is a combination of demographics, lifestyles and behavioural segmentation. Why? Because this combination provides your best opportunities for Differentiation.

N.B. the "End Deliverable" is:
An integrated mix of products/services that is consistent with the customer segment that you are targeting.

Special thanks to John Torella of the J.C.Williams Group for his pioneering work in the art of retail branding.

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