Idea in Brief
The Problem
Companies have long used perceptual maps to understand how consumers feel about their brands relative to competitors’ and to develop brand positions. But their business value is limited because they fail to link a brand’s position to market performance metrics. Other marketing tools measure brands on yardsticks such as market share, growth rate, and profitability but fail to take consumer perceptions into consideration.
The Solution
The C-D map links perception and performance in a new way. It shows brands’ relative position in the marketplace according to perceived “centrality” (how representative a brand is of its category) and “distinctiveness” (how well it stands out from other brands). It also captures financial performance along a given metric, such as sales volume or price.
The Implications
Using the tool, marketers can determine a brand’s current and desired position, predict its marketplace performance, and devise and track marketing strategy and execution.
In-depth examples of the car and beer markets demonstrate the value of this tool for managers of brands in any category.
Marketers have always had to juggle two seemingly contradictory goals: making their brands distinctive and making them central in their category. Central brands, such as Coca-Cola in soft drinks and McDonald’s in fast food, are those that are most representative of their type. They’re the first ones to come to mind, and they serve as reference points for comparison. These brands shape category dynamics, including consumer preferences, pricing, and the pace and direction of innovation. Distinctive brands, such as Tesla in cars and Dos Equis in beer, stand out from the crowd and avoid direct competition with widely popular central brands.