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Salience vs. Differentiation: Is being famous enough for a brand to succeed or does differentiation really make the difference?

April 13, 2023

City Hall in Stockholm, Scandinavia, Sweden

Cajsa Wiren

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If you are a follower of the general marketing discourse on LinkedIn, Twitter, or in the marketing media, you’ll notice ongoing debates around supposedly opposing concepts – long-term versus short-term, traditional versus digital media, mass marketing versus targeting, etcetera. Each concept comes with its own dedicated following and active promoters swearing their view of the world is the correct one. A big, seemingly conflicting, topic that has sparked debate in recent years is the issue of salience versus differentiation.

At its core this is a discussion on the best route to brand growth. One side of the argument claims that improving salience, i.e., having a brand that people come to think of in many buying situations, is the only route. This implies that brands should only focus on making sure they are mentally and physically available to consumers in the right buying situations, and that building a differentiated brand position is a waste of time and resources. Team Differentiation, on the other hand, argues that brands need to find a meaningfully different position compared to their competitors or they will lose their relevance in the marketplace. The pendulum has been swinging back and forth on this topic over the years. Not long ago, most brands were focusing all their efforts into creating a differentiated position. However, salience has made a comeback thanks to the highly influential work of Byron Sharp and the Ehrenberg-Bass Institute.

As entertaining as these polarised marketing debates can be, the truth is often that it’s not either/or. We need to consider both the long and the short term, traditional and digital media combined to reach the broadest audiences, etcetera. And the same goes for salience and differentiation. Both are crucial aspects of long-term brand building, but they play different roles in how they contribute to a brand’s growth.

How do Salience and Differentiation add to your brand growth?

Sharp and his colleagues have shown that salience is a key factor for growing volume and revenue via increased penetration and the activation of non-frequent buyers. But solely focusing on salience means ignoring another important benefit of having a strong brand, which is creating pricing power – i.e., that consumers are willing to pay more for your brand compared to competitors. This is where differentiation comes in. Brands that are very salient but lack differentiation against competitors are perceived as generic and can rarely justify charging a higher price for their products or services. On the other hand, a brand that is differentiated from competitors in a way that is meaningful and value adding for consumers can not only charge a price premium, but maintain it over time.

Well known examples of this strategy are Apple and Tesla. Both those companies have been successful in building a unique position as a niche brand, then grow their salience without compromising on their differentiation. This has allowed them to dramatically grow their market share over the years while keeping their price premiums intact. Then there are other brands, like Virgin and IKEA, that have built a unique brand position and then used the higher perceived value from consumers to keep a sustainable growth and expand their brands into other areas.

So, both Team Salience and Team Differentiation are right – salience grows volume and revenue, whilst differentiation builds and maintains pricing power, over time.

To ensure that investments are allocated in the right direction, brands need measurements and KPIs that capture both perspectives. Most brands measure salience in some way, either through brand funnel KPIs in a Brand Tracker or through other measurements such as share of search. A Brand Tracker usually also covers brand associations or attributes. This is an important way to keep track of consumer perceptions and the current competitive landscape. But brand associations should not serve as long-term KPIs of differentiation.

Achieving a differentiated position is a moving target – consumer needs and behaviours change, and a brand’s position needs to be adjusted to maintain differentiation over time. What sets your brand apart from competitors today may be category standard in just a couple of years. Thereby, the brand associations you choose as your main KPIs for differentiation will need to be changed and updated frequently, making them difficult to use as guidance for long-term strategy adjustments. Instead, brands should consider the end-goal of having a differentiated position and use pricing power as a KPI for differentiation.

At Nepa, we have developed a Willingness to Pay (WTP) solution that captures a brand’s pricing power. The solution uses Discrete Choice Modelling (conjoint) to simulate actual choice trade-offs and is a valid method to accurately measure and predict consumers’ willingness to pay for the different competitors in a market. It shows the incremental value that is created by a strong and differentiated brand in a simple, transparent KPI that can not only be quantified in monetary value, but also connected to market share development. Nepa’s Willingness to Pay can be added to our continuous Brand Tracking set-ups, providing brands with the KPIs they need to grow through both salience and differentiation.

Blog Posts

That’s so OTT! The fast-changing media landscape in India

February 15, 2022

Sam Richardson

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In 2021, approximately 2.2 billion people used OTT streaming services worldwide, growing from 1.9 billion in 20191.  When we talk about Over-the-top (OTT) media, we mean a streaming service offered directly to viewers via the Internet. These services bypass the traditional distributors of media services such as cable, broadcast, and satellite television. Netflix, AppleTv, Disney +, are just some of the platforms that have entered the entertainment scene in recent years, catering to the burgeoning audience who want on-demand content across all screens and devices.

The increase in streaming services is matched by high consumption especially since the start of the pandemic. In India, especially, OTT boomed very early on, thanks to early adoption by national broadcasters, with up to 80 million active, subscribers2, OTT in India is no longer a niche category and has huge growth potential.

It is not surprising to see an increasing number of brands opting to advertise on OTT platforms. But this new way of providing media content brings new challenges and opportunities. So, what does the Indian OTT landscape look like?

  1. Content with no boundaries

Compared to a pre-OTT era, now the boundaries of national and international content are blurred.

In India, regional content is on the rise, with an increase of regional titles in the digital space emerging in a very short time-period. What we’ve noticed is that regional media effectively brings together the three main elements of the media ecosystem: brands, consumers, and broadcasters.

Brands can reach their addressable audience effectively through these platforms with better targeting at higher frequency for optimized spends, as opposed to traditional touchpoints like TV, Print and Radio amongst others, for example. OTT has democratized marketing levers too, this is due to the creating of a new advertising ecosystem. Whereas previously brands would advertise blind to viewers on networks through typical broadcasting avenues, brands can create targeted ads to OTT subscribers. Consumers have access to more diverse and relatable content, having access to untold stories that cut across cultures. Broadcasters now have the chance to represent a demographic which is completely unrepresented in mainstream media.

However, to make regional content go global it is important to keep the cultural nuance intact, this treatment can have mass appeal to audiences.  So that means dubbing or subtitles won’t do the trick, what viewers are looking for is authenticity and content that cuts through.

  1. The challenge of paying premium

The challenge of today’s media consumption is that viewers expect to have entertainment at their fingertips without having to pay a premium for it. But high-quality content is expensive.

With 27% of Indian viewers paying for subscriptions, we see willingness to pay for good quality content is increasing, but at a very slow pace.

  1. Different content means different devices

The choice of content and device in India is often determined by socio-economic conditions, even family dynamics and identity play an important role.

We’re in a market where mobile is the be all and end all, it’s almost the choice by default. But when it comes to media consumption there are different factors that influence the choice of device.

It’s not only about what’s the best technology available, but it’s more about the type of content and genre the viewer wants to see. Is it a movie to watch with the whole family? Is it a sports match to watch with friends? Or is it a show that only you are interested in?

Depending on the type of content and moment of the day, the device of choice will be different. Of course, watching something with a group of people means a bigger screen, while mobile is reserved to individual use.

The OTT situation in India is varied and presents untapped opportunities for brands and broadcasters. We’re just at the start of what is shaping up to be a media consumption revolution with more diverse and authentic content for all. Literally, watch this space!

By Esha Nagar, Managing Director Nepa India


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