Weak Value Proposition #1 Reason for Ineffective Branding, 1/3 of Brands Have Unaided Awareness

A recent branding study found that a weak value proposition and lack of differentiation are the two most common reasons for ineffective branding. The study also found that only 30.7% of brands in a given category have unaided awareness.
 
Oct. 13, 2011 - PRLog -- A recent branding study found that a weak value proposition and lack of differentiation are the two most common reasons for ineffective branding. The study also found that only 30.7% of brands in a given category have unaided awareness.

The study, titled “Challenges and Opportunities in Effective Branding”, was conducted in July and August 2011 among 156 senior executives in marketing and sales, predominantly in the United States.  The study was conducted by Top-of-Mind Branding, a Yardley, PA-based consulting firm.

Among the key findings:

The four most common reasons for ineffective branding*
•   Weak value proposition - 47.3%
•   Lack of differentiation - 44.7%
•   Lack of brand/operations alignment - 35.3%
•   Poor communication of brand attributes - 32.7%

In this question on the internal factors impacting effective branding, weak value proposition and lack of differentiation were selected as the two most important reasons for ineffective branding. 19.3% of participants selected both weak value proposition and lack of differentiation and 72.7% selected either weak value proposition or lack of differentiation.

“Given that the value proposition and differentiation are the foundation on which branding is built, it is apparent that ineffective branding often happens at the very beginning of the branding process,” Bill Fellows, President of Top-of-Mind Branding, explained.

Even with an effective value proposition and differentiation, branding can derail when there is poor brand/operations alignment and poor communication of the brand attributes (the third and fourth most selected reasons). “These areas are often thought of as “living the brand”.  If these do not support the value proposition and differentiation, there is brand breakdown and ineffective branding,” Fellows said.

The percentage of brands in a given market category that are:
•   Mentioned when given the market category - 30.7%
•   Known when mentioned - 37.1%
•   Unknown when mentioned - 32.2%

When asked generally about the percentage of brands in a given market category that have unaided awareness, aided awareness and are unknown, study participants divided brands roughly equally in each group.  However when asked specifically about the brand or brands on which they are working today, participants were more positive and put more brands (49.7%)  in the “known when mentioned” group but still put only about one-third (33.1%) of brands in the “mentioned when given the market category” group .

The four major trends impacting branding today*
•   Pace of technological change - 46.0%
•   Market saturation/Increasing competition - 38.0%
•   Changing customer wants/needs/likes - 37.3%
•   Cheap/free media creating “noise” in the marketplace - 34.7%

In this question about the external trends impacting branding, the pace of technological change was the trend selected most often. Market saturation/increasing competition, changing customer wants/needs/likes, and cheap/free media creating “noise” in the marketplace were tightly grouped as key trends impacting branding.

“Surprisingly, pressure to hold or reduce prices (22.3%) garnered less than half the responses of the leading trend, which is interesting given economic conditions of the past three years,” Fellows said. “The participants thought that the current economy, where companies are being forced to hold or reduce their prices due to lower demand, is impacting their branding far less than other trends.”

Marketing “buzz” is generally
•   Effective in long-term brand building - 67.1%
•   Neither helpful nor harmful in long-term brand building - 31.6%
•   Harmful in long-term brand building - 1.3%

More than two-thirds of participants felt that marketing “buzz” is effective in long- term brand building, with almost another one-third expressing that “buzz” is neither effective nor harmful to long-term brand building. Only 1.3% felt that marketing “buzz” is harmful to long-term brand building.

“The key question is whether the “buzz” is supporting the value proposition and differentiation of the brand,” Fellows explained.  “If so, it clearly can be effective in brand building. If not, the “buzz” is probably going to have a neutral or negative impact on brand building.”

The full study, including graphics, can be found at www.topofmindbranding.com.
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