POP and POD

Definitions for points-of-difference (POD) and points-of-parity (POP)

Points-of-difference (POD) and points-of-parity (POP) are essentially opposite in nature, with the
first referring to differences in the second referring to similarities. As a result, we can the following
definitions for our purposes as students of marketing:
When deciding upon a brands/products positioning in the marketplace, the organization must
ensure that end positioning has both sufficient points-of-parity (POP) and points-of-difference
(POD). What this means is that you want the brand/product to be consider equal/similar (on par
with, hence the word parity) with the major offerings in the category for the key attributes (POP),
but the brand/product also needs to have a number of unique or differentiated attributes (POD).
An appropriate balance is required for market success. Too much reliance on points-of-parity in the
products positioning and it could be perceived as a me-too product offering. And too little
emphasis on points-of-parity and the product might be perceived as not meeting the core needs for
the target market.
Points-of-difference (POD)

The aspects of the product offering that are relatively distinct to the offerings of like
competitors.

Points-of-parity (POP)

The aspects of the product offering that are largely similar to the offerings of like
competitors.

You will note that both definitions referred to the offerings of competitors, so these terms are
relative measures. And to clarify the word aspects; it refers to the various product features,
benefits, brand equity, and other marketing mix elements (including price and place, plus any
associated marketing mix elements of services).
Understanding PODs and POPs
Typically, a firm decides the positioning of a product when it is either: entering a new target market
for the first time or launching a new product into an existing target market. In either case, the
product will usually need to win market share from established competitors (which is referred to as
selective demand).
For the product to win market share, it requires existing consumers in the marketplace to change
their purchasing behavior. That means that customers who currently buy a competitive product will
need to trial the new offering and/or current non-consumers need to be activated to purchase in the
product category for the first time (which is primary demand).
To achieve this goal of changing established purchasing behavior, the firm has both meet the core
need of product, as well as bring something new to the marketplace. The following diagram
demonstrates this in visual terms. As you can see, the large circle in the middle of the diagram

represents the core needs of the market (points-of-parity) and the smaller circles represent new
features or benefits (points-of-difference).
Therefore, the positioning of any new entrant needs to have many points-of-parity (that is, it must
be seen to offer a relatively similar solution), but it needs to have something unique or different
about it (points-of- difference). (For more information, please refer to the example section below.)

The POD POP Trade Off

One of the challenges for a firm launching a new product offering is to the extent that they
differentiate the product. As outlined in the positioning section of this marketing study guide, one of
the purposes of positioning is to simplify the offering in the minds of the consumer.
As we know, marketing communication is a very competitive world and it is difficult to communicate
many messages about a product, particularly low-involvement one. Therefore, as it is necessary to
simplify the message, firms need be careful about overindulging in points of difference.
As shown in the following diagram, there is a distinct trade-off between the ability of the firm to
communicate points-of-parity and points-of-difference. This is because consumers are likely to only
remember a few elements about the product. .Ideally, an organization would like to communicate
everything about all of their products, but that is just not practical given the interests of the
consumer and the vast array of marketing messages being sent out.
Therefore, firms need to strike an appropriate balance and to position the product within the
product category as having sufficient points-of-parity, while highlighting one or two points-ofdifference.
The assessment of consumer desirability criteria for PODs should be against:

Relevance
Distinctiveness

Deliverability

Whilst when assessing the deliverability criteria for PODs look at their:

Feasibility
Communicability
Sustainability

These will help understand how successful these PODs are likely to be in the minds of the consumer.

Unique Selling Proposition (USP)

The concept of a unique selling proposition (USP) has become quite popular in terminology in recent
years. Essentially what this refers to is points-of-difference and you can use the terms
interchangeably if required. A point-of-difference is basically what is different about the firms
product, as compared to most competitive offers. The same meaning is applied to the term unique
selling proposition; that is, what is unique (that is, different) about the firms offer.
What to emphasize POD or POP?
Continuing on from the discussion on the previous section, while firms do need to balance their
emphasis between points-of-parity (POP) and points-of-differentiation (POD) there are occasions
when a firm should more heavily emphasize one of these elements. The following table outlines the
circumstances when a greater emphasis is required.

Situation
When the firm is a me-too

What to emphasize
In this case, being a weaker competitor, the goal is to piggyback
on the success of the market leader by highlighting many points-

competitor

of-parity

When the firm as a market leader This is the reverse situation from the one above. To maintain
market leadership, the brand/product needs to be seen in as
superior/different in key ways, thus highlighting the need to
focus on relevant points-of-difference
When the firm enters an
established and mature market

In this case, the likelihood of switching is relatively lower, so

points-of-difference are required to break their habitual loyalty

When the firm and is a fastgrowing market

Fast-growing markets have primary demand (that is, first-time

customers to the market), therefore points-of-parity positioning
will should be quite successful in capturing new customers

When there is a diversity of needs, When there is significant diversity of consumer needs, a pointseven when looking at fairly narrow of-difference positioning should ensure that reasonable market
market segments
share is generated
In a target market where the firm To reduce the risk of cannibalization of sales, the firm would
already offers multiple products need to have more emphasis on points-of-difference
In a relatively price sensitive
market

Our goal in this case would be to provide additional benefits, in

order to reduce the importance of price in the decision.
Therefore, a points-of-difference positioning emphasis would be
required

Kevin Keller and Alice Tybout[1] note there are three types of difference: brand performance
associations; brand imagery associations; and consumer insight associations. The last only comes
into play when the others are at parity. Insight alone is a weak point of difference, easily copied.
Putting these together, check their desirability, deliverability and eliminate contradictions.
Traditionally, the people responsible for positioning brands have concentrated on the differences
that set each brand apart from the competition. But emphasizing differences isn't enough to sustain
a brand against competitors. Managers should also consider the frame of reference within which the
brand works and the features the brand shares with other products.
Points of Parity Association
POPs come in four basic forms

Category related
Benefit related
Usage Occasion and Time of Use
Price / Quality by Usage Occasion and Time of Use

Category Related

Tanishqwatches sold as jewellery

Vaselinepetroleum jelly sold as lip salve and moisturizer
Sugar free.historically sold to diabetics through chemist outlets, now being sold as weight
control device, targeted at the figure conscious being sold through supermarkets

Benefit related
a)

b)

Functional
Lifebuoy (kills the germs you cannot see)
Pepsodent (12 hr protection against germs)
Fevicol (jod jo tootega nahin)
M-Seal (seals all leaks)
Emotional
Close-Up (confident)
Franklin Templeton Blue Chip (secure)
Liril (fresh)
J&J (caring)
Axe (irresistible)

By Usage Occasion and Time of Use

Kwality Walls.(post dinner treat.10 oclock)

Listerine (Night time rinse.Get fresh tonight)
Clorets (after drinking, smoking, eating.after anything)
Nescafe (great start to the morning)
Britanias Chai Biscoot (for tea times)
Dominos (when families are having fun, e.g. watching TV or playing scrabble

Price-Quality by Usage Occasion and Time of Use

Peter England (the honest shirt)

Big Bazaar
Westside (surprisingly affordable)
Indian Airlines (Apex fares)
Nirma

Why me ?
Points of Difference Associations
PODs are Strong, Favourable, Unique brand associations for a brand. They may
be based on virtually any type of attribute or benefit association.

Brand

Differentiating Parameter

Gillette

Double Edged Blade

Dove Soap
Orchid Hotels
Ariel Detergent
Ceat Tyres
Maruti Service
Maggi
McDonalds
Saffola
Asian Paints
ICICI Bank
Scotch Brite

One Fourth Moisturiser

Eco Friendly Hotel
Performance
Tough
After Sales Service
Food in two minutes
Burgers that taste the same
98% Fat free
Computerized Shade Cards
First Internet Banking Service
Scrub with Sponge & Coir

NEW
PRODUCT DEVELOPMENT (NPD)
Introduction
Improving and updating products is an ongoing task as consumer needs and wants continuously
change. A failure to develop products could result in a reduction in sales if consumers decide to buy
competitor products. The eight stages of new product development are described below.

Stage 1: Idea Generation

New product ideas have to come from somewhere. But where do organisations get their ideas for
NPD? Sources include:

Market Research
Employees
Consultants
Competitors
Customers
Distributors and Suppliers
Stage 2: Idea Screening
This process involves shifting through the ideas generated above and selecting ones which are
feasible and practical to develop. Pursing impractical ideas is expensive and a waste of resources.
Stage 3: Concept Development and Testing
The organisation may have come across what they believe to be a feasible idea, however, the idea
needs to be taken to the target audience. What do they think about the idea? Will it offer the
benefit that the organisation hopes it will? or have they overlooked certain issues? Will there be a
demand for the product? Note the idea taken to the target audience is not a working prototype at
this stage, it is just a concept.
Stage 4: Marketing Strategy and Development
How will the product/service idea be launched within the market? A proposed marketing strategy
will be written laying out the marketing mix strategy of the product, the segmentation, targeting and
positioning strategy and expected sales and profits.
Stage 5: Business Analysis
The company has a great idea, the marketing strategy seems feasible, but will the product be
financially worth while in the long run? The business analysis stage looks more deeply into
the Cashflow the product could generate, what the cost will be, how much market shares the
product may achieve and the expected life of the product.
Stage 6: Product Development
At this stage the prototype is produced. The prototype will undergo a serious tests, and will be
presented to a selection of people made up of the the target market segment to see if changes need
to be made.
Stage 7: Test Marketing
Test marketing means testing the product within a specific geographic area. The product will be
launched within a particular region so the marketing mix strategy can be monitored and if needed
modified before national launch.
Stage 8: Commercialisation
If test marketing is successful the product is ready for national launch. The following decisions
regarding the national launch need to be made

timing of the launch

how the product will be launched
where the product will be launched
will there be a national roll out or will it be region by region?

Conclusion
The eight stages of product development may seem like a long process but they are designed to save
wasted time and resources. New product development ideas and prototypes are tested to ensure
that the new product will meet target market needs and wants. There is a test launch during the test
marketing stage as a full market launch is expensive. Finally the commercialization stage is carefully
planned to maximize product success, a poor launch will affect product sales and could even affect
the reputation and image of the new product.

Q) What do you think of Young & Rubicams Brand asset Valuator? What do you see as its main
advantages and disadvantages?

Ans) The Brand Asset Valuator (BAV) is a database of consumer perception of brands created and managed
by Brand Asset Consulting, a division of Young & Rubicam Brands to provide information to enable firms to
improve the marketing decision-making process and to manage brands better. Brand Asset Valuator and
BAV also describe the Y&R group managing the database.
BAV provides comparative measures of the equity value of thousands of brands across hundreds of different
categories, as well as a set of strategic brand management tools for planning brand extensions, joint
branding ventures, and other strategies designed to maintain and grow brand value. BAV has now been
linked to a unique set of financial analytics, which allows determining a brands contribution to a companys
intangible value.
There are four key components of brand health in BAV the four pillars. Each pillar is derived from various
measures that relate to different aspects of consumers brand perceptions and that together trace the
progression of a brands development. These four components for determining brand value are

1. Differentiation:Differentiation is the ability for a brand to be distinguished from its

competitors. A brand should be as unique a possible. Brand health is
built, and maintained by offering a set of differentiating promises to
consumers. And by delivering those promises to leverage value.
2. Relevance:Relevance is the actual and perceived importance of the brand to a
large consumer market segment. This gauges the personal

appropriateness of a brand to consumers and is strongly tied to household penetration (the percentage
of households that purchase the brand).
3. Esteem:Esteem is the perceived quality and consumer perceptions about the growing or declining popularity of a
brand. Does the brand keep its promises? The consumers response to a marketers brand building
activity is driven by his perception of two factors: quality and popularity. Both vary by country and
culture.
4. Knowledge:Knowledge is the extent of the consumers awareness of the brand and understanding its identity. The
awareness levels about the brand, and what it means, shows the intimacy that consumers share with the
brand. True knowledge of the brand comes through building of the brand.
How Brands Are Built
Four Primary Aspects

Brand Strength
Differentiation and relevance taken together say a lot about a Brands strength (brand vitality). These two
pillars point to the brands future value, rather than just reflecting its past.
When Differentiation is greater than Relevance, the brand has room to grow. This is a healthy
pattern.

When Relevance is significantly greater than Differentiation, the brand has become commoditized.
Its Uniqueness has faded and price has become the primary reason to buy. This is an unhealthy
pattern.

Brand Stature
Esteem and knowledge together create Brand stature, which is a report card on a brands past
performance and which determines the current power of the brand.
When Esteem is greater than Knowledge, and the consumer says, Id like to get to know you
better. Consumers have motivation to find out more about your brand. This is a healthy pattern
for the brand.

When Knowledge is greater than Esteem, consumers are saying, I know you more than I like you.
The brand has become too familiar and consumers have no motivation to listen to you. Too much
Knowledge has become a dangerous thing.

Mapping a Brands Life: the Power Grid

BAV uses a two-dimensional plot to

measure Brand Strength and Brand
Stature.
The strength is measured on the
vertical
y-axis
*Differentiation,
Relevance] and stature is measured on
the horizontal x-axis *Esteem,
Knowledge].
The Power Grid provides a model for
mapping and diagnosing the life of a
brand. New brands begin in the lower
left quadrant with low strength, low
stature. As the brand develops, it rises
to the upper left quadrant where
strength is significantly higher than
stature. It is here where niche brands
and brands with unrealized potential reside. This is high margin territory. In order to maximize shareholder
value, brands should be strategically leveraged to move to the upper right quadrant, where powerful
leadership brands reside. When brands get into trouble, the first thing to erode is Differentiation, causing
leadership brands to decline. This loss in Differentiation reduces the ability to extend the brand across new
consumer and market segments. As a result, there is a huge loss in intangible value.

Advantages of Young & Rubicams Brand Asset Valuator

Brand Asset Valuator is an important tool to assess a brands current achievements and stature. It is
even more powerful when the future potential of a brand can also be measured. Y&Rs Brand Asset
Valuator offers this opportunity.
Combining exhaustive amounts of consumer data with a proven model of brand-building, Brand Asset
Valuator anticipates future operating earnings and operating margins. This can enhance the
marketing-decision process in a variety of substantive ways.
Brand Asset Valuator can help managers understand marketplace opportunities and the types of risk
that go with them. It can provide a deeper understanding of consumer behavior: for example, shedding
light on reasons why some segments are willing to pay a higher price for a highly differentiated brand.
Brand Asset Valuator stands apart from other brand study aids in a number of ways. It is predictive,
focusing on leading indicators instead of lagging. It is exhaustive in every way, size and scope. Most
importantly, it evaluates a brand in the entire world of brands, not in its category.
Brand Asset Valuator also helps to determine a brands elasticity and helps to explore beneficiary
brand alliances.
Lastly, Brand Asset Valuator is not only just useful for creating brands. It is useful for managing brands
in the long termthrough ups and downs.

Disadvantages of Young & Rubicams Brand asset Valuator

 The major disadvantage associated with Young & Rubicams Brand asset Valuator is that it is
proprietary in nature and can be employed only by Young and Rubicam.
Another disadvantage associated with BAV is that the measures underlying the four factors may not be
relevant across a wide range of product categories and thus these factors tend to be abstract in nature
and might not be related directly to product attributes or benefits and more specific marketing
concerns.

Nevertheless, the BAV model represents a landmark study in terms of marketers ability to better
understand what drives top brands and where their brands fit in with other brands.

FCB GRID
QUADRANT ONE

he FCB grid was developed by Richard Vaughn, a Senior Vice President of Foote, Cone and
Belding Advertising. It helps direct advertisings creative strategy and media strategy as it clarifies
how consumers approach the buying process for different products. Notice that the process is
driven by the TYPE OF PRODUCT, so product analysis is our first step understanding advertising
and its part in the 4P's and the C model, the C model includes Consumer, Cost, Convenience and
Communications.

roducts in Quadrant One of the FCB Grid are products that are of high importance to the
buyer (generally more expensive) and are decided on rationally. Generally, the buyer will research
competing products and will want lots of information before making a buying decision.

ASSIGNMENT
Using the web, find another well-designed page for a product that belongs in Quadrant One. Does it
provide all the information you want. How could this page be improved? (Make sure you record the
product and the WEB address to share with the class.)
FCB GRID
QUADRANT TWO

roducts in Quadrant Two of the FCB Grid are high involvement (expensive and an
important decision) but are more emotional in the decision making process. You buy designer
clothes because they will make you feel good about the way you look and feel or to show your
status--all emotional responses. Other examples would be engagement rings, Nike Galaxy
sneaker, fine perfumes or it could be a car (normally in Quadrant One) if it was a sporty red
convertible that you bought to make you feel young or sexy. If your product is in Quadrant Two,
you need to generate emotional responses and create an image that people are willing to buy.

Assignment:
Go on the web and list 3 product ads that fall into Quadrant two and explain why.

Identify product or service in the ad give details and explain why it conforms to Q2 advertising
strategy
FCB GRID
QUADRANT THREE

uadrant Three of the FCB Grid is for products that are lower involvement (not really a lot
to lose if you don't like the product) and rational decisions. Here we find many package goods,
such as detergents, paper products and other everyday items. Since these are rational decisions,
the consumer generally needs to be given a reason to buy (differentiate the product from others
and find market niches) and there is the need within the ad to generate brand loyalty and repeat
buying. Reminder ads and coupons or other sales promotion can help here. Even though this is a
rational decision, the lower importance means that consumers probably won't wade through long
copy print ads.

Assignment:
Go on line and find 4 product ads that conform to this mode of advertising appeal. List products and
give details from the ad that qualifies it to be classified under this quadran

FCB GRID
QUADRANT FOUR

uadrant Four of the FCB Grid is for products that are low involvement, emotional
decisions. These are items that aren't really very expensive and make you feel good or provide
self-satisfaction. Here, you would find entertainment, snack foods, fast foods, soft drinks, and
candy. Many times, these are impulse or convenience buys. Products in this catagory don't really

have a lot of rational reasons for you to buy, and rely heavily on "feel good" ads. Many times,
lifestyles are portrayed to attach an image to the product (such as, if you are young, drink Pepsi.)

Brand Extension: Advantages and Disadvantages of Brand Extension

by Smriti Chand Marketing Mix
Brand Extension: Advantages and Disadvantages of Brand Extension!
Brand extension refers to the use of a successful brand name to launch a new or modified product in
the same broad market. A successful brand helps a company enter new product categories more
easily. For example, Fairy (owned by Unilever) was extended from a washing-up liquid brand to
become a washing powder brand too.
The Lucozade brand has undergone a very successful brand extension from childrens health drink to
an energy drink and sports drink. Nikes brand core product is shoes, but it is now extended to sunglasses, soccer balls, basketballs, and golf equipments.
Advantages of Brand Extension:
Brand extension has the following advantages:
1. It makes acceptance of new products easy:
a. It increases brand image.
b. The risk perceived by the customers reduces.
c. The likelihood of gaining distribution and trial increases. An established brand name increases
consumers interest and willingness to try new products having the established brand name.
d. The efficiency of promotional expenditure increases. Advertising, selling and promotional costs
are reduced. There are economies of scale as advertising for core brand and its extension reinforces
each other.
e. Cost of developing new brands is saved.
f. Consumers can seek for a variety.

g. There are packaging and labeling efficiencies.

h. The expense of introductory and follow-up marketing programmes is reduced.
2. There are feedback benefits to the parent brand and the organization:
a. The image of the parent brand is enhanced.
b. It revives the brand.
c. It allows subsequent extension.
d. Brand meaning is clarified.
e. It increases market coverage as it brings new customers into brand franchise.
f. Customers associate the original/core brand to new products; hence, they also have quality
associations.
Disadvantages of Brand Extension:
1. Brand extension in unrelated markets may lead to loss of reliability if a brand name is extended
too far. An organization must research the product categories in which the established brand name
will work.
2. There is a risk that the new product may generate implications that damage the image of the
core/original brand.
3. There are chances of less awareness and trial because the management may not provide enough
investment for the introduction of new products assuming that the spin-off effects from the original
brand name will compensate.
4. If the brand extensions have no advantage over competitive brands in the new category, then it
will fail.