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CHAPTER 1

Brand Positioning

ALICE M.TYBOUT and BRIAN STERNTHAL

W

hen TiVo launched its digital video

recorder (DVR) system in 1999, the leading technology market research firm

Forrester predicted,"These hard-drive machines will take off faster than any

other consumer electronics product has before."Forrester projected that there

would be greater than 50 percent household penetration by 2005.They were

optimistic because TiVo allowed viewers to store a library of shows tailored to

their preferences,pause or rewind liveTV,and quickly skip through commer-

cials. In addition,TiVo was easy to program. In its initial advertising,TiVo an-

nounced that it would revolutionize television by empowering viewers to

"Watch what you want, when you want."

Although TiVo aficionados love it and recommend it with an almost evan-

gelical zeal, sales have fallen far short of Forrester's (and others') enthusiastic

initial forecasts.As of January 2005, only 2.3 million households (slightly less

than 2 percent) had TiVo.At the same time, the adoption rate of DVRs was

increasing as cable companies began to embrace the technology and offer

their own systems. But TiVo's future remained uncertain.We contend that a

critical factor in TiVo's lackluster performance was the absence of a clear

brand positioning.

Brand positioning refers to the specific, intended meaning for a brand in

consumers' minds. More precisely, a brand's positioning articulates the goal

that a consumer will achieve by using the brand and explains why it is supe-

rior to other means of accomplishing this goal. In the case of TiVo, the brand

was positioned as empowering consumers, but how and why it accomplished

this goal was never clear. Was TiVo like a VCR in allowing consumers to

record programs for playback at a later time? If so, what made it a superior

means of performing this function? If TiVo wasn't a better version of the

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VCR, then what was it and why was it uniquely empowering? Advertise-

ments used to launch TiVo failed to answer these questions.

This chapter addresses the challenge of developing a strong brand posi-

tioning.We begin by outlining the key elements of a brand's position.These

include the goal that the customer can expect to achieve by using the brand

(frame of reference) and an indication of why the brand is superior in achiev-

ing the goal (point of difference).This is followed by a more detailed assess-

ment of how to select an appropriate customer goal, create a superiority

claim, and orchestrate these elements to develop an effective position. We

conclude by discussing how a brand's positioning can be evolved over time.

Positioning Fundamentals

A statement of a brand's position is typically developed by the brand man-

ager.Ideally,it is grounded in insight about the goals and perceptions of a tar-

geted group of consumers. Managers develop formal positioning statements

to ensure a shared vision for the brand throughout the organization and to

guide tactical thinking. Accordingly, a brand positioning statement may be

distributed widely within the firm and even shared with the firm's partners

(i.e., advertising agency and retailers).Although the positioning may be writ-

ten in consumer-friendly language, consumers are not expected to read the

positioning statement. Rather, the consumer will see the end results of this

positioning statementÐ'--the brand design, pricing, communications, and

channels of distribution.

Formats and terminology for presenting a brand's position vary by com-

pany, but certain components are generally viewed as critical:

1. A brief description of the targeted consumers in terms of some identifying

characteristics,