Page 300 - Marketing Management

CRAFTING THE BRAND POSITIONING | CHAPTER 10 277

frame of reference are closely linked to target market decisions. Deciding to target a certain type of
consumer can define the nature of competition, because certain firms have decided to target that
segment in the past (or plan to do so in the future), or because consumers in that segment may al-
ready look to certain products or brands in their purchase decisions.

IDENTIFYING COMPETITORS A good starting point in defining a competitive frame of
reference for brand positioning is to determine category membership—the products or sets of
products with which a brand competes and which function as close substitutes. It would seem a
simple task for a company to identify its competitors. PepsiCo knows Coca-Cola’s Dasani is a major
bottled-water competitor for its Aquafina brand; Citigroup knows Bank of America is a major
banking competitor; and Petsmart.com knows a major online retail competitor for pet food and
supplies is Petco.com.
The range of a company’s actual and potential competitors, however, can be much broader than
the obvious. For a brand with explicit growth intentions to enter new markets, a broader or maybe
even more aspirational competitive frame may be necessary to reflect possible future competitors.
And a company is more likely to be hurt by emerging competitors or new technologies than by cur-
rent competitors.
• After having spent billions of dollars building their networks, cell phone carriers AT&T,
Verizon Wireless, and Sprint face the threat of new competition emerging as a result of a num-
ber of changes in the marketplace: Skype and the growth of Wi-Fi hotspots, municipal Wi-Fi
networks built by cities, dual mode phones that can easily switch networks, and the opening
up of the old analog 700 MHz frequency used for UHF broadcasts. 5
• The energy-bar market created by PowerBar ultimately fragmented into a variety of subcate-
gories, including those directed at specific segments (such as Luna bars for women) and some
possessing specific attributes (such as the protein-laden Balance and the calorie-control bar
Pria). Each represented a subcategory for which the original PowerBar was potentially not as
relevant. 6

Firms should identify their competitive frame in the most advantageous way possible. In the
United Kingdom, for example, the Automobile Association positioned itself as the fourth “emer-
gency service”—along with police, fire, and ambulance—to convey greater credibility and urgency.
Consider the competitive frame adopted by Bertolli. 7

The energy bar market has
fragmented into a number of
sub-categories, each appealing
to different people in different
situations.