At last week’s MINDBODY University, I had the opportunity to teach business leaders how to increase their competitive advantage. Although the seminar was attended by business owners in the health, fitness, and wellness industries, the principles we covered are instructive to most all businesspeople and so I thought I’d share them here.

The core of the session focused on competitive brand positioning – what is it, why is it important, how do you develop one.

What is a competitive brand positioning?

It’s a strategy that defines how your business will establish and maintain competitive advantage.  It’s one half of your brand platform – the other is your brand identity, or what your brand stands for. Your competitive brand positioning references who you are selling to, what your business scope is, and what you do to create value for your customers. It drives your business strategy and operating plan.

Why is competitive brand positioning important?

I can’t think of any business that doesn’t compete with something (another company, a changing market, emerging technology, etc.) And in order to effectively compete, you must understand what you’re competing against for whom, and how best to position your brand to leverage your strengths and take advantage of market opportunities.

Without a competitive brand positioning, your brand might only remain a conceptual vision or a set of cultural values which sound great but don’t really make a difference in the marketplace. A meaningful, powerful, valuable brand is based a clear, crisp articulation of your competitive strategy.

How do you develop a competitive brand positioning?

In-depth knowledge of your target, your competitors, and your own business enables you to define a strong positioning. Use rigorous market research and competitive intelligence to uncover new insights and develop a proprietary point of view about the market opportunities and competitive landscape (see my research and competitive landscape map tools). You also need a fresh and objective assessment and analysis of your own company’s capabilities, resources, and assets (a brand diagnostic can help.)

Armed with these insights, you can use the following competitive brand positioning statement template to articulate your positioning:

For X,
we are the A who does B
because C

• X = target audience

Who are you trying to persuade? What distinguishes them? What’s important to them?

• A = competitive frame of reference

What is your aspirational competitive set? What is the mental file folder your target should put you in?

• B = differentiating value you deliver

What do you do that no else does as well and that your target cares about? Why should your target value you?

• C = reasons to believe

What evidence proves that you deliver that value?

Some examples:

A few years ago, a national smoothie QSR chain articulated their competitive brand positioning as follows:

For (X) everyone who chooses to do something good for themselves, we are (A) the convenient place for great tasting, healthy products that (B) energizes the way you live and feel — because we (C)
• are considerate of what you put in your body
• make it enjoyable to be healthy
• help create healthier communities

A running shoe and athletic gear company used the following statement to describe their competitive position:

Only we design (B) performance solutions that (A) fit (X) athletes and fitness enthusiasts who are confident in themselves and are driven to achieve.  (C) Reasons to believe:
- we offer the largest breadth of shoe widths
- our company started as an arch support business
- we continue to innovate insole designs to optimize fit

(As the above example indicates, your competitive brand positioning can take on a different sentence structure — you don’t have to use the exact template, as long at the components are included.)

You might have an intuitive understanding of your competitive strategy, but it’s important to take the time to document your competitive brand positioning. Doing so will ensure you’ve applied a rigorous analysis and covered the most salient points of your strategy – and the statement is a powerful tool to unify and align all of your stakeholders.

A few final notes:

-  target – Some businesses try to reach everyone because don’t want to limit their appeal – but history shows, if you try to be everything to everyone, you end up being nothing to no one. If you target a particular type of person or group, your relevance to them is stronger as is their identification with your brand.

Also your strategy will be stronger is you define your target audience with more than demographics. People groups are growing in diversity, so an 18 year old young lady in California is probably looking for very different things from a similarly-aged person in the South — and actually might have more in common with a 30-something guy who embraces an active lifestyle.  So use mindset, needs, attitudes, or values to profile a more precise target.

-  competitive set – The opposite tact is necessary here – you want to think broadly about who you’re competing with. The more narrowly you define your competition, the more easily it is to identify your competitive advantage – but also the more likely you’re overlooking viable options your target is considering.

A fitness boot camp isn’t simply competing with other boot camps – it’s also competing with other types of specialized workouts, full-service fitness clubs, non-group workouts like running, and even inertia. The couch may be its biggest competition! So define your competitive set from your target’s point of view, not your category’s.

-  differentiating value — Unless you’re the 99 cent store, price is not a sustainable differentiator. If the only thing that differentiates your offering is price, it’s fairly easy for a competitor to undercut you or bait you into a price war.

That’s not to say price promotions shouldn’t be used as introductory offers or other limited time only deals, but they should not be the thing you count on to maintain competitive advantage. Instead, your differentiating value should be based on a claim that you are “the best,” “the first,” or “the only” brand to do what you do.

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Later today I will be presenting the new strategic brand platform to the Board of Directors for an organization I’ve been working with.  I thought I’d take this opportunity to share my approach to brand strategy.

Why do you need a brand strategy?

I believe a brand is a driver and compass for the organization – it focus and aligns all decision-making and it guides what we do/don’t do and what we say/don’t say.  Having a clearly articulated brand strategy ensures everyone who works on our brand shares one clear, consistent, common understanding of what our brand stands for and how it competes.  And this, in turn, helps them align their behaviors and decision-making with the brand so that it is delivered through every touchpoint with the outside world.

Simply put, if we are clear about our brand, so will our customers be.

The brand strategy should be clearly articulated and written down.  Whether your organization has 5 employees or 500,000 – whether you’re just starting the business or it’s been around for decades — it’s dangerous to assume everyone knows what your brand platform is or to rely only on informal means for sharing it.  Particularly in these times of so much change, it’s easy for efforts to become unfocused or focused on the wrong things.  Your brand strategy should be codified.

Also, with so much buzz about customer co-creation and the power of word of mouth vs. traditional one-way brand communication, some pundits have proffered, “Your brand is whatever your customers say it is.”  This would suggest that there is little value in defining and articulating your brand strategy – I completely disagree.

An organization must know and make clear what it wants its brand to stand for and how it wants it to be positioned.  There is definitely a place for collaboration and integration with customers on how the brand manifests itself and how it is expressed (see 2 great presentations 1, 2 on this topic from German agency nouve, but I believe a brand strategy is as valuable a tool for business leaders today as it ever has been – if not more.

What is a brand strategy?

A strong brand strategy is really comprised of a complete strategic platform:

• brand identity – what your brand stands for – the values and attributes that define your brand
• competitive brand positioning – how your brand compares to existing options – this includes your target customers, the frame of reference in which they consider your brand, and the unique benefit or value you provide to them

An example I came across years ago is Campbell’s.

The two parts of the platform are integrated and interdependent. The brand identity explains who/what the brand is; the competitive brand positioning explains how the brand does what it does.  The brand identity tends to be more timeless, serving as the constant foundation of the brand; while the competitive brand positioning can change as the competitive context and target audiences change.

Your brand understanding is incomplete if you only have one part.  Without a brand identity, your company lack beliefs and principles to guide its market activity. You define yourself more by your context and less by your organization’s strategic intent.  Particularly in categories in which the products have become commoditized (fast food, for example) or in which the distinctions between competitors is difficult to ascertain (healthcare), the who and the what of the brand is the basis for most of a brand’s differentiation.

Without a brand positioning, the business orientation of the brand platform is missing. In isolation, a brand identity can seem only conceptual.  You need a brand positioning to reference who you are selling to, what your business scope is, and what you do to create value for your customers.  If the brand is defined separately from the business strategy, often the two aren’t aligned — and so when conflicts arise, the brand takes a back seat to the business.

Together the brand identity and competitive brand positioning function symbiotically – complementing and supporting each other.

A strategic brand platform is intended to provide richness and depth, not complexity.  Some of the best brands can be summarized in a single word or idea (Southwest Airlines = fun; Disney = family magic).  But in order to fulfill its potential as a business driver, leaders must expound on the brand and dimensionalize it into a full platform.

There are many frameworks that can be used to communicate the brand identity and competitive brand positioning.  Building blocks, circles/wheels, four-boxes, etc. — each is relevant to a different type of brand.  Storytelling, images, and videos are often helpful approaches to expressing a brand strategy.

What makes a brand strategy good?

The strength and integrity of a brand platform can be judged by several criteria.

1. Is it meaningful? – is it relevant and compelling to our target customers?  Some brands create new desires; others simply meet existing demand – either way, people must value what the brand stands for and delivers.
2. Is it believable? – does it over-promise or set up false expectations, or does it pass muster among even the most skeptical of customers?
3. Is it differentiating? – does it give us a distinct advantage over competitors?  The advantage must be noticeable, understood, and appreciated by your target customers.
4. Is it feasible? – does it accurately reflect our organization’s capabilities?  A brand platform can be aspirational but it must be possible.
5. Is it sustainable? – does it enable us to provide value and compete now and in the future?  The brand should be an enduring proposition which drives continuous improvement and innovation, not a fad-dependent or short-lived idea.

How is a brand strategy used?

As I explained earlier, the brand drives everything the organization does.  So it guides and influences R&D, product/service development, manufacturing, operations, sales, distribution, employee recruitment/training/development, stakeholder engagement, strategic planning – oh, and also marketing.

In the case of the organization I’m meeting with today, the new brand platform is of particular interest to the staff, who see it being particularly helpful in their prospective employee interviewing/screening process (“The brand personality explains the exact kind of employee we’re looking for,” said one manager).

Also it’s serving as a guide for the website re-design they’re undertaking, ensuring that the experience of using the website is aligned with the brand attributes we’ve developed.
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I hope this information has been helpful.  I haven’t done a post like this in awhile — I’ve been doing more observation and analysis lately.  So if you’d like to see more posts like these, please let me know.  Also if you or someone you know wants to know more about engaging me to develop a strategic brand platform, here’s an overview of my Brand Platform service offering.

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I read with great interest an article in SmartBusiness about Red Mango and the yummy yogurt chain’s founder, president, and CEO of Red Mango, Dan Kim.  I’m fascinated by the frozen yogurt chains that have emerged on the cultural landscape in last 5 years.  Pinkberry has probably gotten the most coverage in the press, with its high design aesthetic and celebrity fans, but there are plenty of others in the game including Red Mango.  The category is very crowded with operators of all sizes competing in a relatively small niche with punch cards and discount days.  Building brand awareness and shoring up a loyal customer base are particular challenges, which is in part why I’m so interested in the category (liking fro yo also has something to do with it too!)

In the SB piece, Dan explains his thinking and approach to building the Red Mango brand.  Clearly, this is a guy who gets it.  He believes in the power of his brand and he actively nurtures and protects it.  Here are my reactions to his comments, along with some suggestions for how he might ensure his brand-building efforts continue to be successful as the chain grows.

Good stuff
Dan’s commitment to the Red Mango brand is remarkable:

• It’s his primary focus. He says, “We always start with, ‘Who do we want to be when we grow up and who are we as a brand?’…We always keep that top of mind in terms of everything we do.”  And he keeps his focus on it.  “If you constantly change who you want to become, the strength of your brand goes away.  If you try to do too much and address too many things, you stretch yourself too thin and really can’t accomplish anything.”
• He’s clearly articulated what the brand stands for and has documented it in a digestible, memorable form.  Unlike many entrepreneurs, he didn’t just assume that his employees would know what is in his head – nor that explaining it once is enough. He created a “brand trifecta” that outlines the brand’s core values and there’s a “MangoFesto” in the form of a poster in each store that explains to employees what the goals and philosophy are.  Dan says, “The thing that you can do that’s not cool is you write [a brand manifesto] once, and you never come back to it, and it gets lost.  You have to make that part of the cultural fabric of your organization.”
• He also uses the brand as a filter for decision-making.  In other words, he operationalizes the brand platform in key decisions about what the company should or should not do.  Frozen yogurt in cones didn’t pass the brand test but papaya as a new topping did.

The next level
Dan’s brand-building efforts have paid off.  Last year, the company received a $12 million cash infusion and they’ve been successful enough to recently launch an aggressive franchise push with the goal of opening 550 locations over the next five years.  That kind of growth will present a host of challenges, not the least of which is maintaining the priority on the brand.

It’s a common problem.  When a company is smaller, there are fewer players who need to “get” the brand.  And as long as the founder (or whatever role the brand champion might play) is actively involved in the daily operations of the business and as accessible to employees, it’s fairly easy to stay on track.  But issues arise as growth inherently brings more people to inculcate, more opportunities to assess, and more touchpoints to align.

A couple of tools and approaches will help Red Mango and other companies aspiring to grow their brands and their businesses:

Competitive positioning. I’ve found the best brand strategies are actually brand platforms comprised of a brand identity (what the brand stands for) and a competitive brand positioning (how the brand compares).  The brand identity is based on the key values and attributes of the brand – including the brand essence or core belief.  The competitive brand positioning outlines the target, the competitive frame of reference and how the brand is optimally positioned in that frame, and the unique benefit of the brand.

Some companies only outline one part of the brand platform but both are important.  You must understand the defining values and attributes of your brand (brand identity) but without a competitive positioning, you aren’t indicating how you will use those core elements to establish competitive advantage.  And you must outline how you compare with other options, but without a solid brand identity, you won’t have the foundation that drives consistency and focus.  Furthermore, the brand identity should remain constant; the competitive brand positioning might change over time as the target audience or the competitive landscape changes.  The two parts of the platform are complementary and symbiotic.

The Red Mango brand essence is outlined in the SB article:  it’s the convergence of health, taste and style.  The piece, however, didn’t speak to the chain’s competitive strategy.  Perhaps a competitive brand positioning exists, but if it doesn’t, I would encourage Dan to clearly articulate one.  And in particular, getting the competitive frame of reference (i.e., the mental file folder that the target puts your brand in) is key.  I’m guessing it’s not simply other fro yo brands (although carving out a unique position in that category is important) – but also other quick serves as well as buy/make at home options.

Empowering stakeholders. In explaining the aforementioned no-go decision on the cone idea, Dan relayed that it was a franchisee who suggested the idea and it was Dan and his executive team that assessed the opportunity.   As the chain grows, it will become increasingly important for others including franchisees to be able to make their own assessments.  Otherwise the executive committee will become a bottleneck for decision-making and a barrier to growth.

I suggest an effort to inspire, inform, and instruct everyone about the brand and how they should interpret and reinforce it in their daily decision-making.   A brand toolbox is an effective way to do so. The collection of tools in a brand toolbox:

• relays the brand identity and positioning along with the background and rationale to increase understanding and buy-in, and outline principles and examples to guide appropriate brand execution
• connects people to a purpose and values bigger than themselves, get them excited about working on the brand, and motivate them to adopt behaviors which support it
• helps people make decisions and take actions that are “on brand” through interactive exercises and decision guides

A brand toolbox can take a variety of forms – workbooks, videos, website, downloads, or a combination of these – the important thing is to develop one that engages everyone who works on the brand.

Aligning stakeholders. A brand toolbox can also be helpful in aligning all stakeholders and their expectations.  At one point, Dan laments, “…you have a lot of outsiders or board members or executive managers who don’t understand how the strategy is executed in regards to having the right resources, then you’re in a situation where you just constantly want to do more and more things without people understanding why you can’t do them.”

He’s talking about brand stakeholders and the real need to align them in order to garner their support.  Board members for example significantly influence the value the organization delivers and the way it does business through their strategic, high-level guidance on things like resource allocation and M&A activity. The businesses a company works with to develop, make, distribute, and sell the product — vendors, strategic alliances, distribution channels, service providers, franchisees/affiliates, etc.– are stakeholders in the brand. The number and range of stakeholders only grows as your business grows.

By fleshing out what the brand is and how it is used, a brand toolbox facilitates brand understanding among these audiences.

Imagine your brand as a source of light. In an ideal world, the light of your brand would shine strongly and directly on its intended target. However the current marketplace is far from ideal and so your brand’s light becomes quite diffused and unfocused in the clutter and competition that exists between your brand and its target.

Brand stakeholders actually function as filters for your brand light. Essentially your stakeholders are situated between your brand and its target. Each stakeholder bends and directs the light in their respective roles.

Problems arise when different stakeholders bend and direct the light in different ways. The result? A mess of light rays all pointed in different directions and none focused on the target.

Your stakeholders need to be aligned so that you end up with a laser-like beam of brand value delivered to your target. While it may seem that the people and groups who comprise your brand stakeholders are independently-operating entities fulfilling a specific function or playing a particular role, a more accurate picture is that they are linked together in a brand value delivery chain.

A brand toolbox is a great way to reinforce this linkage.  Sometimes there is a need to protect or segment some parts of a brand toolbox, but generally speaking the more transparent you can be about what your brand is all about and how you’re operationalizing it, the better.

I hope these suggestions are helpful not only to Dan and his team at Red Mango, but to all business leaders who are passionate about their brands and about growth.

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