Drawing from strategy analysis work by Harvard Management Professor Michael Porter, branding becomes the “advantage” when it identifies and exploits operational excellence, customer intimacy or product leadership in the experiential lens of the consumer. Each category has general requirements that are required of a strong brand and overlap between groupings, but the brand differentiators are categorically based.
The brand “advantage” differentiators for operational excellence are product and service attributes, such as price, time, quality and selection. The result of successful exploitation of this brand “advantage” is the consumers viewing themselves as “smart shoppers.”
There are general requirements for brand “advantage” differentiation for the customer intimacy category, where product and service attributes are necessary, but the brand differentiator is service and customer relation. The consumer views the result as a “trusted brand.” To attain branding sustainable competitive advantage in the product leadership category, it is required to provide product and service attributes, as well as a solid relationship, but the differential “advantage” is found in product functionality or time. The consumer views this brand as “best in class.”
Research-driven Brand Analysis and Strategic Branding – Determining the sustainable competitive advantage is a function of branding research into the market needs, company’s strengths and competitors’ weaknesses. Where they overlap, the “sweet spot,” is where the company has a strategic and sustains- able competitive advantage. This study is detailed and inclusive of internal culture analysis, as well as traditional marketing research. Nothing is surer to prevent successful brand exploitation than a toxic corporate culture that cannot deliver a consistent brand promise.
“Capitalizing” Converts Sustainable Competitive Advantage to Branding – The role of strategic branding is to exploit the sustainable competitive advantage. It is the brand manager’s role to develop programs to capitalize on the firm’s advantage; however, finding the “advantage” inherent in the organization is often a monumental task. It is even more instrumental to the success of the company if the brand analysis finds the “silver bullet” advantage in the marketplace, but determines that it is not a characteristic inherent of the company, requiring a long-term strategic management and marketing evolution.
If you don’t have It, Create It The salience is that branding is the function of identifying and capitalizing on sustainable competitive advantage. For companies that don’t have a sustainable competitive advantage, it is incumbent on them to create one according to “what the company can offer that the market wants and is the competition’s weakness.” Firms that do not offer a competitive advantage languish in the backwashes of mediocrity if, in fact, they can survive over the long-run.
While causing a company to create a sustainable competitive advantage from the manufacturing side (product leadership) may be so monumental as to be virtually impossible, operational excellence and customer intimacy are attainable. The creation of “advantage” from these perspectives is quintessentially strategic, long-term and can entail great re- sources allocation, but they are certainly more achievable than “building a better mousetrap.”
Importantly, customer intimacy and operational excellence are goals of most enterprises, as seen by the vast penetration of CRM and TQM, but are rarely executed with “sustainable competitive advantage in mind.” The important point is that as goals, they can be long-term and the brand strength can be built over time. As branding consultants, it is vital that the discipline establish a clear definition of the brand, least it be further diluted by those who don’t know what it is, but do know how to sell businesses on buzz words and trends. The branding discipline has a large and growing body of knowledge, yet that good work will be for naught if consensus isn’t reached as to a viable definition and process that is recognized and understood by more than the most sophisticated companies.
