Knowledge Bank Blog, Pricing & Promotions, Range & Portfolio

Reinforce Your Point Of Difference

Are you doing what only you can do?

‘They are all the same’. How often have you heard that?

See a picture of a 21 year old footballer driving a Bentley. Flash – too much money, too young, right? But what if he is driving the Bentley to a children’s hospital to spend the afternoon with the kids? Does that make him the same? Or make him different?

What about the city banker? She is trying to make as much money as possible, doesn’t care how she makes it, right? But what if she only invests in ethically responsible companies? Gives her bonus to charity? Does that make her the same? Or make her different?

Stereotypes make our lives easier. They mean you don’t have to think too hard. If you are in a particular group, then you are just like all the others in the group. However, things are rarely like that. In any group there are likely to be many more people who don’t conform to the stereotype, than do.

Thinking everything is the same is not a good point of view to have in life. And it is not a good point of view for our industry.

If all retailers are pretty much the same, does it matter which one you go to? Not really. If all brands are pretty much the same, does it matter which one you buy? Not really. And how do you make a choice if you think everything is the same? Probably, whichever is cheapest or on deal.

When Aldi do head to head comparisons with brands, they are trying to convince shoppers that their brand is pretty much the same as the brand leader (but cheaper). However, the reverse can also happen. When a brand leader is constantly discounting its price, it is implicitly suggesting that it is pretty much the same as all the other options on the shelf. Why pay more, when you can buy us for less?

You are not beating them – you are joining them.

But, to justify a higher price you have to beat them. To trade shoppers up in a category you have to beat them. To reset prices through innovation you have to beat them. You have to do the things that only you can do.

So, what are some of the things we mean?

Product. This is about being crystal clear on what is important to shoppers. What drives choice? If it’s taste, be a clear No 1 on taste. If it’s cleaning performance, be a clear No 1 on cleaning performance. To do this you need to measure performance. Are you clearly better than the competition? Not just your main competitor, but against the wider competitive set – small, emerging brands, private label, discounter brands. And, if you have an advantage, protect it. Because once it is eroded you may never get it back.

It is not just about having a better product, but about having a different product. This is particularly important if you are not a brand leader. Are you serving a different shopper need or shopper type? One that other brands are not serving? If all products are serving similar needs and similar shoppers, retailers need less of them in their range. And in a world where retailers are looking to simplify, that is a threat. Be better. Or be different. And if you can, be better and different.

Proposition. This is where your point of difference should really kick in. Where you are telling shoppers why they should buy you. It could be an emotional reason. The ‘Lynx Effect’ is a great example of this. Something Lynx has, that competitors don’t have. It could be an occasion. Bighams is an example in chilled ready meals – ‘Perfect for 2’ is offering a good quality, convenient evening meal solution for a couple. Or it could be a functional reason. Fairy washing up liquid is another good example – consistently communicating that it lasts much longer than the competition.

What do all these examples have in common? They tell shoppers about their point of difference. In ATL communication and in store – on POS, packaging or shelf ready packaging.

Promotions. Most FMCG promotions can be run by any brand. Anyone can do a third off or half price. What any brand can’t do is promotional activities that link directly to, and reinforce, what their brand stands for. If Walkers wants to differentiate on flavour, then a promotional activity built around sandwich flavours, is reinforcing this. It is an activity competitors would find difficult to copy.

Amongst the retailers, Waitrose has probably been the most innovative in this area. You can get price discounts in any store. But do you get pick your own offers elsewhere? A free cup of coffee? These are specific reasons to shop at Waitrose. That only they are offering.

Fitting in can be a race to the bottom. However, standing out can be a race to the top.

As the great, grunge philosopher, Kurt Cobain, said, “They laugh at me because I’m different. I laugh at them because they’re all the same”.

Don’t be the same. Be different.

On a separate note, our monthly article in The Grocer goes out in tomorrow’s edition .  There is a link to it on our website……nt-of-purchase/