Friday, February 16, 2007

Brand Preference - The Key Metric In Determining The Right Strategy

When To Protect, Preempt, Promote, Poach, And Probe For Consumers

By David Miranda

Many times in marketing various analogies are used to help make an important point. One of the most common themes are those that compare marketing to warfare, as in, " the battle for the hearts, minds, and wallets of consumers." It is the relentless battle for brand preference. In today's marketplace, preference is perishable. Hyper-choice of products, services, media, and distribution channels have shifted market power to the consumer and the battle is fierce.

This requires a new marketing perspective for brands in the allocation and deployment of limited resources to achieve optimum results. The key question is how to do it effectively.

The answer lies in understanding brand preference - yours, your competitors, and the considerable number of consumers who have no preference - the brand agnostics.

A brand should develop and monitor a brand preference spectrum that identifies and measures those consumers with a strong preference for the brand over all other choices; those who have a soft preference (sometimes switch to competitors); those who are brand agnostics (no preference at all); those who have a soft preference for competitors; and finally those who have a strong preference for one or more of your competitors.

Each of these segments in the brand preference spectrum require a different marketing strategy as follows:

  • For those with a strong preference for your brand, it is important to implement a marketing strategy to "protect" these your best customers from defecting to competitors, since they represent the greatest R.O.M.I. and lifetime value for the brand.
  • For those with a soft preference, it is important to preempt competitive poaching. They may prefer your brand over others, but are vulnerable.
  • For the brand agnostics, it is important to continually use promotions. These consumers are constantly switching from one brand to the next primarily driven by promotional offers. All other things being equal, they will go with the best offer.
  • For those with a soft preference for your competitors, strategies should be employed to poach these consumers taking advantage of their vulnerability.
  • For those with strong preference for competitors, a marketing strategy to probe those consumers who may consider switching preferences has high returns. This cannot be accomplished effectively and efficiently with mass marketing. It requires market intelligence and precision.

In summary to get the best Return On Marketing Investment, allocate and invest marketing funds in strategies that protect, preempt, promote, poach, and probe for success.