How can brands break through in 2023?

In the new world order, the world is facing a major change that has not been seen in a century. Brand innovation is particularly important. So, how should brands break through? This article analyzes brand marketing and innovation in detail, and I hope it will be helpful to you.

01

Yesterday, the novel coronavirus pneumonia was renamed as novel coronavirus infection. At the same time, the virus was legally defined as Class B and is managed as Class B. Some cities have gradually returned to normal after experiencing large-scale infection of the population, but it will take time for the confidence of entrepreneurs and the market to recover. But no matter what, life and business must go on.

In the business world we are familiar with, almost everyone has heard what Drucker, the most outstanding management consultant in history, once said: "The purpose of an enterprise is to create customers. An enterprise has only two basic functions: innovation and brand marketing. Innovation and brand marketing produce results, and everything else is a cost."

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Through Drucker's words, people who run businesses can realize that brand marketing is the most prominent and unique function of a business . In other words, the difference between companies is the difference between innovation and marketing.

03

Brand marketing makes a company stand out. With the popularization of the great business thinker Mr. Trout, Chinese entrepreneurs have a closer understanding of brand marketing. The real battlefield of brand marketing is the mind of customers.

The victory or defeat in the battlefield of customer mind determines the success or failure of a company. Trout and Ries’ classic book “Positioning” is about how the customer mind works. This book details how to enter the customer mind and under what circumstances, you cannot enter the customer mind. In the book “The New Positioning” they co-wrote later, they further elaborated on how the mind works. This book has strengthened the rigor of the theory and introduced more psychological mechanisms and principles.

The third book in the positioning series, "Repositioning," guides companies on how to respond to changes in the business environment. Positioning thinking has been around for more than 50 years, and the world has also undergone tremendous changes, including the Vietnam War, the normalization of Sino-US relations, the disintegration of the Soviet Union, and Japan's economy going from rapid development to stagnation. China's reform and opening up, through reform and opening up, China's economy has become the second in the world, and it is already the world's first in terms of purchasing rate. China and the United States have escalated from a trade war to a technology war and the COVID-19 pandemic.

China learned marketing from the West and quickly used the digital wave to innovate marketing after the advent of the digital wave. A group of supernova brands emerged, which, at least in the Chinese market, can compete with super brands mainly from the United States... All these happened in the past 50 years.

04

In three days, we will enter 2023. If we select the hot word of the year in 2022, "involution" must be the number one hot word. Under the objective environment of the so-called "involution", the three major challenges faced by enterprises are: competition, change and crisis. Enterprises must have a deep understanding of these three challenges, and then break through "involution" in 2023 and achieve a breakthrough.

05

Understand the first challenge that companies face in an involutionary environment: competition. Competition in the business world is extremely cruel. This kind of competition is essentially a "competition between brands". The strength of the brand determines the success or failure of the company. The Chinese market environment is in an environment of "selective violence". Take pet food as an example. If you search on Tmall and JD.com, hundreds of different brands will pop up.

If you have a cold, there are hundreds of brands for you to choose from. Since Nongfu Spring went public, it has gained a very high market value. There are thousands of brands in China that make water, big and small, saying that their water quality is very good. In such a market environment, we need to understand what positioning is and what is the significance of positioning?

06

The meaning of positioning is to "make your brand stand out in the minds of potential customers". Customers have limited mental capacity and can accept very little information. Take milk tea brands for example. The only brands that customers can name are Heytea, which makes inspirational tea, Nayuki Tea, which imitates Starbucks to create the third space, and Mixue Bingcheng, which is for the mass market. At most, they can remember Happy Lemon and Coco. Apart from these, no one has much impression of the thousands of other brands.

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Why is this so? Because there is a "product ladder" in the minds of customers. For example, in the Chinese toothpaste market, Colgate ranks first, Crest may be second, Yunnan Baiyao toothpaste may be third, and in the past two years a brand called Shuke has begun to emerge. For the first category of products, the mind can accommodate no more than seven brands. Moreover, the positioning of these seven brands is completely different. In most industries, these seven brands almost occupy more than 90% of the market share of the brand.

The top three brands will have a leading market share of more than 70%. It can be seen that the higher the position on the product ladder in the minds of customers, the stronger the brand position. The market share of brands on the product ladder varies by multiples. Take the wasabi industry that Liu Yichun himself planned as an example. The wasabi category that he created and planned at the time, King Power Wasabi, had a market share of 75%, while all other brands combined had a market share of only 25%.

On the product ladder: "First" is the best, "Second" is also good, if it is "Third", it is a bit dangerous, and if it is "Fourth", it is fatal. Therefore, Jack Welch, the CEO of General Electric at that time, clearly stated in his business strategy that if you are either first or second, then third you will be sold.

08

To enter the minds of customers, the most important thing is to understand the power of extremely simplified information . The mind likes simplicity and hates chaos. The best way to enter the mind is to extremely simplify information. The most powerful thing is to "occupy the minds of customers with one word." For example, "Quality Tmall, Universal Taobao, Low Price Pinduoduo, Fast Delivery JD." are all selling goods. These brands have found and occupied some positioning concepts and used these concepts to enter the minds of consumers.

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Take cars for example. BMW occupies the "pleasure of driving", so it is the "ultimate driving machine". BMW has also repositioned Mercedes-Benz, which is the "luxury seat" and the "ultimate riding machine".

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Let me give you another example from the United States. Since the mind hates confusion, brands can use this to position themselves. In the field of antihypertensive drugs in the United States, calcium ion antagonists are an important product. There are many brands in this category. In the minds of doctors, too many brands have caused great confusion. Doctors don’t know which one to recommend to customers. When this brand is positioning itself, it first asks the question: Do you know how to choose among various calcium ion antagonists?

At the same time, it also lists 13 brands in the same category, and then tells the doctor, "The new generation of products is dihydropyridine calcium ion antagonists." This eliminates 8 brands at once, and then, it tells the doctor, "However, there are only two brands that only need to be served once a day.

"In this way, three more brands were eliminated, leaving only two brands. Finally, this brand proposed: "Only one brand of medicine has vascular selectivity." This is the positioning strategy of the brand Boyidin.

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The old packaging of Boeding was a circle of orchids, which was problematic because it was difficult for it to enter the minds of customers. If a brand wants to occupy a positioning concept, it must put this concept on the packaging. When designing a new packaging for Boeding, the positioning feature "vascular selectivity" was highlighted in the center. In this way, the real difference of Boeding was perfectly presented.

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Many of the emerging supernova brands, such as Yuanqi Forest, Perfect Diary, Huaxizi, and Zhong Xuegao, are very conscious in these aspects.

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Understand the second biggest challenge facing companies in an involutionary environment : change. No matter how the relationship between China and the United States and other countries in the world changes and develops, we are in an era of rapid change. The emergence of new technologies forces brands to adapt to this change, just like the emergence of live e-commerce now forces brands to adapt to this change.

In other words, during the competition process, brands should adjust their strategies in a timely manner according to market changes. However, the brand’s most fundamental positioning cannot be changed. In many cases, it is better to do it late than never.

Let's take Procter & Gamble as an example. As we all know, Procter & Gamble may be the company with the strongest marketing in the world, but a company like Procter & Gamble is also facing a series of bad news. The US "Business Week" once published a report that many years ago, Colgate took the top market share position from Crest. Crest has a very clear positioning: "preventing tooth decay", which is the positioning of the Crest brand.

The problem is that with the advancement of fluoride toothpaste and dentistry, tooth decay is becoming less and less of a problem. As a result, new brands targeting niche markets continue to emerge, and Crest's market share is slowly being eroded. The trends in dental problems are: 1. Tooth decay is reduced; 2. People live longer and use their teeth longer; 3. Tartar and gum problems are becoming more and more important.

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These changes require product evolution, such as launching a toothpaste that can prevent caries, reduce tartar, and protect gums, that is, provide comprehensive dental care. This is the "repositioning strategy." This is why many supernova brands can rise quickly in the new Internet environment. Crest's positioning is "the pioneer of dental care."

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The problem is that Colgate took the lead and launched an "all-in-one" toothpaste with the core claim of "the most advanced fresh breath and whitening effect." At the same time, Colgate also listed the other unique benefits of this toothpaste. At this time, Crest began to fight back and launched the "Health Expert" toothpaste, claiming multiple benefits. This toothpaste can not only prevent decay, but also remove plaque, reduce gum problems, and many other benefits.

In other words, when a brand is disrupted by its competitors and has to fight back, one opportunity is to copy its competitors' product innovation. Currently, Colgate is still number one in the market, but Crest is catching up. They occupy 30% and 25% of the market share respectively. In the toothpaste category, there are strong first and second brands, and other brands are much weaker in comparison.

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Positioning requires trade-offs, and many companies are very entangled in this issue. The first principle of positioning trade-offs is: "You can't meet the needs of everyone." The more you want to meet the needs of everyone, the greater the damage to the brand. The brand must be focused. Red Bull, Dongpeng, Wanglaoji and other brands can stand out in the fierce competition in the beverage market and obtain the best profits. The essence is also due to focus.

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The power of choice lies in the fact that it can absolutely guarantee to bring you a unique function, and it is absolutely guaranteed. If you are afraid of getting angry, drink Wanglaoji. If you are tired and sleepy, drink Red Bull. Later, due to internal disputes within the brand, Red Bull could no longer advertise, and Dongpeng Special Drink took it over and changed it to "Tired and sleepy, Dongpeng Special Drink".

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Understand the third challenge facing enterprises in the involutionary environment : crisis. In the current uncertain international environment, the economic situation forces enterprises to adjust their strategies. Enterprises must add value to their positioning. For example, Michelin once said that it could provide "more mileage, lower fuel consumption, and better value for money" during the economic crisis. In this way, Michelin added a series of values ​​to its positioning.

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In fact, under the current competitive environment, many brands are facing crises and need to reposition their brands in order to consolidate their brand moats. If you have any needs in this regard, please leave a message and chat with us later.

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Finally, let’s summarize the experience of repositioning:

1. Positioning sometimes needs to evolve, just like the toothpaste example mentioned above;

2. Competition is extremely cruel. Companies must understand the reality, stick to the facts, and realize that "the world is always changing." Corporate strategies must be in line with reality.

3. Focus, focus, and focus again. Avoid the trap of "I can meet everyone's needs". Focus on the positioning of your brand, that is, who are you? What are your main characteristics? And what makes you different?

4. You must be different. You must provide customers with a reason why to choose you instead of your competitors.

twenty one

This is indeed difficult, but it is crucial for companies and brands. Now, Chinese companies are facing a problem: welcoming the new world order, and the world is facing a major change that has not been seen in a century. "If you make a mistake, your competitors will quickly take away your business, and it will be difficult for you to take it back. This is the cruel new world we live in.

So a reporter once asked Dong Mingzhu: "Under what circumstances would you make a mistake?" Dong Mingzhu replied: "I will not make a mistake! How could I make a mistake? How could I make a mistake? If I make a mistake, the company will be finished."

twenty two

In this new world order, brand innovation is particularly important. Entrepreneurs and corporate executives must know how to use relevant strategies for brand innovation and use brand innovation to break through "involution".

Author: Liu Yichun

Source: WeChat public account "Liu Yichun's Brand Business Innovation (ID: shangyeyiguohui)"