Last week I was asked once again to profile the users of one brand (by listing out their demographics, attitudes and habits) and compare them to the users of another brand in the same category.
The client in question was hoping to glean some insights about their brand and their competitors to inform their brand positioning. Sounds sensible, but in fact this line of thought is almost always a dead end and a waste of time and resources. Sure, it's interesting to know who your current customers are but don't expect them to be any different from your competitors'.
If you don't believe me, try it for yourself or read this extract from Andrew Ehrenberg, Stephen Long and Rachel Kennedy 's paper "Competitive Brands' User Profiles Rarely Differ" given to the 2000 Market Research Society Conference ...
"It is widely thought that different brands appeal to different types of users, or should do so. Advertising and other marketing activities are often based on this presumption, and countless segmentation studies are therefore carried out.
To examine this supposition we have compared the user-profiles of the ten or so leading brands in each of some 40 industries – such as Kodak, Agfa, and Fuji for photographic film, or AA, BA, and VA for airlines – on their users’ attitudes, lifestyles, demographics, and media exposures.
The results demonstrate that users of directly competing brands hardly differ in their profiles. That is, brand segmentation generally does not exist – substitutable brands usually compete in what for them is a single unsegmented mass market, whatever its overall structure may be. Exceptions are rare and generally relate to submarkets which are functionally different, such as caffeinated versus decaffeinated coffee.
The analysis procedure used here is simple. It is outlined in some detail so that it can be readily applied to other data. Implications of the lack of brand segmentation in terms of targeting and advertising are discussed in the paper: basically that your market is like your competitors’ market.
This is a fundamental finding and has been validated time and again. The full paper is available via the Market Research Society, WARC or to members of the R&D Initiative.
Nice post. Ehrenberg's stuff is great - have you seen his "Justifying our Advertising Budget's" research?
Posted by: Mark | September 07, 2006 at 11:09 PM