by Byron Sharp
•Which brand a buyer purchases (from the one or few brands they happened to consider on the day) depends on a myriad of factors that relate to the situation and circumstances. Sometimes a buyer is feeling extravagant, frugal, patriotic, etc. Evaluation criteria can, and do, change 'on the fly'. So any actual evaluation that occurs can vary wildly each time a customer goes to buy.
Evaluation is therefore less important and less predictable than our market research techniques assume.
So why are some brands much more popular than others? Why, in the US, are many more Fords sold than Renaults? A part of the answer might be that when buyers actively consider both Ford and Renault they prefer Ford – perhaps Ford is better? Yet this is odd because in some markets, like France, Renault outsells Ford. Also, Renault owners throughout the world report similar satisfaction to Ford owners. The main answer to the question is that many more car buyers remember to consider Ford than Renault. In most markets Renault seldom gets a look in. This is not because people dislike Renault or think that it lacks desirable features. It is just that, outside of France, few people think of Renault89. So the big marketing issue is how to get a brand thought of, more often, in more buying situations; in other words, how to build mental availability.
In any market, many more people buy one brand over another or an individual buys one brand more than he or she buys all the others. This phenomenon typically leads to the intuitive, but largely incorrect, conclusion that there must be a large perceived difference between brands. But differences in perceived product features (or brand image/positioning) only marginally explain why one brand is chosen more or less than another. It is screening out behaviour (and physical availability) that largely explains the vast and continuing market share differences that exist between even highly similar brands.
This suggests a simple prescription: get people to think of a brand. Yet there is nothing simple about this. One of the hardest ongoing battles any marketer faces is to get light, occasional and non-customers to think of their brand. Buyers have too many other more interesting (non-marketing) things to think about. Even brands with plenty of customers still have to fight for customers' attention. Buyers have so many other things going on in their lives that each category (let alone brand) purchase is trivial. What a battle it is for all the vast number of brands in the market to strive for snippets of attention90. This gives us a major clue into how brands compete for buying occasions.
How brands really compete
Decades of research into the patterns in buying behaviour and marketing metrics has led to the surprising conclusion that brands compete for custom primarily in terms of mental and physical availability.
Brands that are easier to buy, for more people in more occasions, get bought more often. Brands that have greater market share are better known (and more noticed) by more people and are more widely available. In other words, brands with larger market share have greater physical and mental availability, and also have larger marketing budgets to support these assets.
Surprisingly, other brand differences have little impact. As discussed in Chapter 8, McDonald's, Pizza Hut and KFC are differentiated in many ways, not least in that they sell different food (burgers, pizza and fried chicken respectively), yet they compete as fast food brands (with McDonald's maintaining its advantage of greater mental and physical availability). Each fast food brand sells to the same sorts of buyers (who hold similar attitudes about the brand(s) they use); fast food brands share buyers with each other as if their products are direct substitutes. Indeed, fast food brands spend considerable time reminding buyers of their similarities (e.g. McDonald's stresses that it offers chicken (burgers) and KFC stresses that it offers (chicken) burgers).
Competition in terms of mental and physical availability fits the empirical facts observed in all product categories (see end of book for a list of marketing laws):
•Brands within a product category sell to nearly identical consumer bases; each brand's consumer base varies from the others chiefly in terms of size (i.e. the number of buyers), not in demographics, psychographics, personality characteristics, values or attitudes (see Chapter 5),
•Buyers of a brand seldom view their brand as being different from its competitors – whether for symbolic, emotional or more prosaic reasons. Buyers very rarely view different brands as being unacceptable. Buyers of different brands express similar attitudes about their brand and similar reasons for buying it. When buyers adopt a new brand their attitudes change in favour of that brand. Buyers simply know and like the brands they buy, and they are vastly more likely to notice, consider and buy these brands over others. Regardless of a lack of differentiation at a brand level or added values, brands have real market-based assets and loyal buyers.
•Buyers are polygamously loyal; they have personal repertoires of brands that they purchase repeatedly; they are seldom 100% loyal, and are never exclusively loyal in the long term. Therefore, competing brands share consumers; they do so with every other brand in the category, and how much they share depends on the other brand's market share. For example, all soft drink brands share more customers with Coca-Cola than with Fanta. Also, when soft drink brands gain sales, they steal sales from all the other brands in proportion to the market share of the other brands. Partitions of brands that share more or less of their buyers with each other are weak – all brands in a category compete as if they were close substitutes in spite of their physical or perceived differences. Diet Pepsi and Diet Coke do share buyers more than predicted, but both still share far more of their buyers with Coca-Cola and any other brands with a large market share.
These empirical patterns show that brands largely compete as branded versions of the product category, with their function, image and price differentiation (within limits) being of surprisingly low importance.
Mental availability
Mental availability or brand salience is the propensity for a brand to be noticed and/or thought of in buying situations91. The term brand salience is sometimes used synonymously with top-of-mind brand awareness measures (e.g. the first financial institution recalled when asked, 'Which financial institutions can you name?'). However, in referring to mental availability we mean more than that. There is a real problem with all brand-awareness measures that assume the link to the name of the product category is all that needs to be measured.
Mental availability is based on the network structure in buyers' memories. For example, memory associations for a bank brand include:
•a branch near work
•home loans
•internet banking
•friends bank there
•a branch on high street
•someone I know worked there
•can get cash out
•Visa
•my first credit card (and the bike I bought)
•the colour, logo, staff uniform, etc.
A simple explanation about how memory works is that memory consists of 'nodes' that hold pieces of information. If two pieces of information are associated (e.g. Vodafone and red), links exist between these nodes. Buyers have a network of information (also referred to as brand associations) linked to a brand name. For example, McDonald's is associated with hamburgers, yellow arches and fast food. These links are developed and refreshed through experiences such as buying and using the brand, being exposed to marketing activities (such as advertising) and hearing about other people's experiences.
There are other aspects of memory, such as sensory memory for smell and taste, and the retrieval of emotions such as joy and pain, but they are more often recalled after a brand is thought of. For example, you think of McDonald's and you have fond memories of your child's last birthday (or not!); whereas for mental availability we are primarily interested in what makes McDonald's thought of and/or noticed.
The more extensive and fresher the network of memory associations about a brand, the greater the brand's chance of being noticed or thought of in the variety of buying situations e
xperienced by customers. Such memory associations also increase the chance of a brand being selected when multiple options are present.
Therefore, building mental availability is about developing different memory links (that relate to a brand) to increase the scope of the brand-related network in people's memories – the brand's share of mind.
More than awareness
Traditional awareness concepts of recognition and recall are typically driven by their measures92, which are invariably single cue measures (i.e. almost always the product category for recall, 'What brands of power tools are you aware of?') or the brand name for recognition ('Have you heard of the brand "Black & Decker"?'). Variations on this theme, like top-of-mind awareness or speed of recall, don't depart from this practice of using only a single cue. Not surprisingly, these measures crudely capture individuals' memory structures and poorly predict the frequency that a brand will be noticed or recalled in buying situations.
Mental availability depends on a brand’s share of people's minds, by which I mean the quantity and quality of memory links to and from a brand. Quantity refers to the number of associations a buyer has about a brand name. Quality has two aspects: strength of association and relevance of the attribute. First, some memory links are stronger than others, in that they are more likely to be activated. For example, for some people, the cue 'Elvis Presley' may always bring fried peanut butter sandwiches to mind and vice versa93. For these people, this is a strong association – yet for many others this may be a very occasional association. Second, some memory links are more relevant to buying situations than others. Elvis Presley is unlikely to be a cue that people encounter when they are in a position to buy peanut butter. However, this association is not entirely unimportant, as hearing an Elvis song increases the chance of people thinking about peanut butter, and by doing so, enhancing links to cues that do occur during buying situations.
When a brand scores well on traditional awareness measures but its sales are disappointing, the common conclusion is that buyers don't like the brand. However, the problem can be that, while buyers know of the brand (and find it acceptable), they seldom think of it or notice it when they are in buying situations.
Buyers use different cues when retrieving brands as buying options. For example, cues for something to eat in the morning may include something low in fat, something healthy and something quick. Buyers may also use more abstract cues – like colour and the style or size of the packaging – to identify and notice specific brands. They may be totally unaware of the cues they are utilising.
By building memory links to attributes marketers can increase:
•the number of people who think of a particular brand
•the number of times each person thinks of a particular brand as an option (to buy).
Linking a brand to attributes means the brand now has some probability to be bought; this is an infinitely higher chance of being bought than when the brand was not thought of at all.
No consumer is wedded to one attribute all the time. This is a common mistake made in segmentation research. For example, rarely is someone always interested in buying something healthy in a product category (or in life!). The typical buyer might be thinking healthy one time, convenient next time and a treat the time after. Buyers use different attributes at different points in time. Context can matter a lot; for example, ice-creams are more likely to be recalled as a food or treat option at the beach and during holidays. Buyers can also use multiple attributes on a single occasion (e.g. convenient and a treat). The attributes can come from anything relevant to the buying context. So it is necessary for marketers to have a broad understanding of the thought processes that consumers go through before they even think of any brands as options to buy. Researching this isn't just a matter of asking consumers, because much of this memory functioning is subconscious.
Cue competitors
Different cues also mean that different competitors are likely to be thought of as options by the buyer at any one time. Competitive options don't even have to be in the same product category. For example, 'something to wake me up' can conjure a coffee, or Starbucks, a Red Bull, a Pepsi, a brisk walk, or a swim. When marketers think of competitors they often think of functional look-alikes. However, it is better to think of competitors as 'cue competitors'. Competitors are all other options linked to the cue, as these are most likely to be thought of and compete for selection.
The importance of distinctive brand assets
Over time brands build memory structures; most of these are very simple, such as associations with colour, pack shape, fonts and tone.
These associations are vital because they allow consumers to recognise a brand and its advertising. In other words, associations allow a brand's communications to do their job of refreshing salience and building new memory structures. Without these distinctive brand assets it is difficult for consumers to digest a brand's communications. Failure to employ these distinctive elements in communication can also mean that existing customers screen out the communication as they do for the brands that they don't use.
So the maintenance of mental availability depends on the quality of branding and advertising. Distinctive, consistent icons and imagery build memory associations that allow a brand to be noticed and recalled in a range of buying situations. This is a huge part of brand custodianship, yet it is often overlooked; marketers often fail to deploy a brand's distinctive assets and, in effect, they sabotage them.
Physical availability
Physical availability means making a brand as easy to notice and buy as possible, for as many consumers as possible, across as wide a range of potential buying situations as possible. This includes more than retail penetration, but also presence in store. It includes hours of availability, and ease of facilitating the purchase. Being easy to notice and buy is essential, because buyers do not have strong preferences even for the brands they are loyal to; they are happy to buy alternatives from within their personal repertoires (and they regularly do).
There is a double jeopardy law that applies to distribution. An extremely reverse-L-shaped relationship between physical availability and market share has been observed using cross-sectional brand data in multiple countries, and across several categories (Reibstein & Farris 1995) and over time for a single brand that rapidly gained and lost share and distribution (Farris et al 1989). Researchers documenting the law have concluded that higher share brands tend to sell more “per point” of retail distribution than their smaller share rivals – an advantage of scale, bigger brands gain efficiencies. There are two things driving this scale advantage, one is that as brands gain very broad distribution they enter areas where they are stocked alongside very few competitors (e.g. convenience stores, vending machines), so the last points of weighted distribution deliver disproportional share gains. The other reason is similar, larger share and more widely distributed brands also are allocated more shelf space in the stores they are in.
However, there is a far more interesting implication of this empirical law-like pattern. It suggests that while high physical availability is an essential requirement for high market share it does not guarantee market share. What we observe is a large number of brands that suffer low market share (low sales). These brands vary greatly in their physical availability, some are in few stores, while some are in nearly all the stores (particularly all of the ones that sell a lot of their product category). Yet irrespective of their physical availability their sales are low. This suggests they are lacking mental availability, or may be very high price or low quality options with limited appeal.
Figure 12.1: Example of convex relationship between distribution and sales
Source: cited in Reibstein and Farris 1995, Detergent category in the Netherlands.
It is also observed that among the brands with very high levels of distribution there are enormous differences in market share. So brands require broad availability if they are to have a chance of high market share, but again it i
s not guaranteed. Every major consumer marketing corporation in the world has rolled out a new brand (or SKU) with extensive distribution only to see it languish on shelf. Indeed some of these firms will roll out hundreds, even thousands of such ‘innovations’ this year that will sell for only a while on the back of them paying for prominent positions in store, with accompanying promotions and discounts. The lesson is clear, physical and mental availability need to go hand in hand, advertising falls flat when the brand isn’t physically available, and brands sit on shelves when consumers don’t notice them.
Extending physical availability can be increasingly expensive, for example gaining distribution in the major supermarkets may give a grocery brand substantial availability while gaining beyond this will involve pushing into convenience stores which is logistically far more complex. There are offsetting advantages however, as a brand expands its distribution it tends to enter progressively less competitive retail environments (e.g. a vending machine that only stocks your brands) (Farris et al 1989).
I'm surprised how often marketers of consumer goods and services will say, “Oh well, we have practically 100% availability”. They point to their brand's presence in all the leading supermarket chains, or their national branch network or their web site that can take orders 24 hours a day. None of this comes close to 100% availability. Perhaps the problem is the word “availability”; I don't mean “available if a consumer is motivated to seek out the product”, I mean readily available. Like the often reported aim of Coca-Cola to be no more than an arm's length away. Against a standard like this, it's easy to see that every marketer has potential to improve the physical availability of their brand.