Creating an effective brand differentiation strategy

Brand Differentiation Strategy

Every brand wants to be different. So it stands out to customers in a cluttered market – and compels them to buy from you and not your competitor. Think Apple, Innocent, H&M and Ikea. On the surface, they’re companies that make computers, smoothies, clothes and furniture – and their products may be pretty similar to their competitor’s. But each of these organisations have a scrupulously considered brand differentiation strategy, making them unique from others in the market. Reams have been written about devising clever brand differentiation strategies, that use positioning and a distinctive tone of voice to stand-out. Here’s a handful of the some commonly used, and highly effective brand differentiation strategies:

Innovation for differentiation

Devising a new technology or way of working can provide brand differentiation. Abercrombie & Fitch’s nightclub ambiance upped the ante for store experience, and Starbuck’s concept coffee shop changed the way we get caffeinated. It’s most noticeable with mobile technology brands that constantly introduce new features to keep them relevant and interesting.

Verdict: Innovating captures attention but needs to be constantly reinventing to lead the market; if not, brands can fall by the wayside, like former market leaders Microsoft and Nokia, who struggle to keep up with more agile-thinking brands. You wouldn’t want brand differentiation to be achieved through a lack of innovation, like these brands.

Pricing strategy

Primark, Ikea and Lidl lead the field for their more-for-less attitude, a winning brand strategy in today’s throwaway culture. It can work the opposite way too, where brand differentiation is achieve through the idea of quality at a price; Bollinger and Waitrose both position themselves with a reassuringly higher price, developing high levels of customer loyalty.

Verdict: You can capture a considerable market share through lower price, but it can be difficult to sustain over time, as there is always someone who can do it cheaper. It can lead to high customer churn too, as people are constantly looking for a better bargain. Consider if you really want your brand differentiation strategy to be based on a race to the bottom.

Differentiation through product qualities

Some brand differentiation strategies focus on product as differentiator, whether how it looks, how it performs or how it’s made. You can highlight on the basis of your product’s attributes (it cleans better, works faster); durability (tougher boots, stronger tape); superior performance (BMW as ‘The ultimate driving machine’); or design (B&O, Ferrari or Habitat). It’s sometimes linked to where the product is made (Gucci and Fendi are stylishly Italian; Dior and Givenchy impeccably French; BMW and Audi reliably German).

Verdict: Product brand differentiation forms a strong emotional bond with a consumer (people still talk about M&S clothing as quality, even when the brand is floundering). But it can be overwhelming if features and specifications are too involved, like in the technology market. Bang & Olufsen complemented it’s brand differentiation strategy with the introduction of the more affordable Play sub-brand, aimed at a younger, upwardly mobile audience. In doing so, it broaden its appeal and bolstered its bottom line.

Customer service for differentiation

Some brands base their brand differentiation strategy on offering exceptional customer service, including First Direct, Amazon and the RAC. It can create strong loyalty based on personal contact, and a brand can build up a reputation for reliability over time.

Verdict: Easy for competitors to copy. It can be expensive for a brand in terms of training and staff, as well as the need for advertising or other messaging. Making this a lengthy process in achieving brand differentiation status.

Brands driven by personality

Using language and imagery to stand apart from others leads to high levels of brand recognition and recall. Is the brand your best friend? An educator? Concerned about your welfare? Or a motivator who wants you to run faster, climb higher and take risks? Pepsi is often perceived by consumers as younger, Coke as more real and honest, Dr. Pepper as more non-conformist. A brand’s straplines, logos, imagery and copy embody this difference in personality, which should lead all creative and often the way the company behaves.

Verdict: This type of brand differentiation strategy can create human-like characteristics to make brands more desirable, textured and distinctive, but it can also be limiting to a brand’s development.

Brand proposition

Finally, one of the most successful ways of achieving brand differentiation is through developing a unique proposition. Devising an effective positioning statement (like De Beers’ ‘Diamonds are forever’ or Johnnie Walker’s ‘Keep Walking’), which reveals your brand’s outlook, vision or philosophy – and mirror what your customers aspire to. They research individual values, aspirations and social interests to determine what drives customers to buy, as well as what intrigues, excites or satisfies them.

Verdict: A unique proposition can create a strong, loyal following or even brand evangelism (think Apple and Harley Davidson), but may take time and money to achieve.

Building a strong brand needs the right brand differentiation strategy to create purchasing preference, customer loyalty and ultimately more sales. And that takes different thinking.

Stewart Hodgson
Stewart Hodgson
Our co-founder, Stewart, is responsible for content strategy and managing Fabrik’s publishing team. It’s up to Stewart to bring Fabrik to busy marketers’ attention. As a regular contributor to Brand Fabrik, Stewart creates articles relevant to anyone in branding, marketing and creative communication.

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