Category strategy

The category strategy is to start from the consumer 's cognition, find opportunities for category differentiation, and use the consumer's mental operation rules to preemptively occupy mental resources to form a strong brand in the market .

The category in the traditional sense is mainly the concept of sales management , which refers to the classification of physical attributes of products . Marketing strategy in the category, is the "father of the positioning of the" Iris given a new concept called "the mind of a small grid" is the perspective of the customer mind the distinction between different products. For example, in the sense of traditional sales management, Mercedes-Benz and BMW belong to the category of high-end cars, but from a mental point of view, Mercedes-Benz belongs to the "riding machine" and BMW belongs to the "driving machine".

Mr. Reese further pointed out that the behavioral characteristics of customers are "thinking by category and expressing by brand ". For example, when customers expect to buy beverages, they first choose among different categories such as tea, pure water, and cola. What was expressed after Ding Cola was a brand representing the category, such as Coca-Cola . Therefore , the competition in marketing is not so much a struggle for brands as a category competition. Based on this discovery, Mr. Iris re- positioning the brand as a "representative of the category name", and pointed out that brands can not survive in case of the demise of the category, not the brand of eternal life, business best strategy is to save the business rather than brand.

On this basis, Ai Reis and his partners formed a brand new strategic idea and method—category strategy system, and put forward the idea of ​​enterprises to build a strong brand by grasping trends, innovative categories, development categories, and dominant categories. The category strategy subverts the traditional brand theory, which emphasizes communication. The brand is replaced by image and brand. It provides practical and effective guidance for companies to create brands. The category strategic thinking and methods are also the most advanced strategic methods of the positioning school today . Used in actual combat.

Today's marketing is not so much about managing a brand as managing a category, rather than promoting a brand strategy , rather than promoting a category strategy. To achieve the success of a category strategy, the following four points can effectively help you.

Brand is the name of the category in your mind, so the first choice to create a brand is to create a category. Because once you become the pioneer of a category, you have a preconceived advantage, and being born is a leader .

The pioneering category can first take advantage of the trend of differentiation. Is there any major invention or innovation of Terensu ? This is not important. What is important is that it differentiates and focuses on the high-end milk market in the ordinary milk market. Product, but not an independent high-end milk category. Why is Baidu successful? From a marketing or market perspective, Baidu's success is because it has become a differentiated search market and focuses on Chinese search.

You can also create a category tricky, he said before Xizhilang is an example, when a promising category has been born, but not when the brand in the minds of consumers represent this category, companies have advantages in resources can be spread through resources , Be the first to occupy this category. Kizhiro later repeated the trick and introduced the good time seaweed to seize the convenient seaweed category. However, the situation is different. The mental status of convenient seaweed such as Sizhou and Libo is far stronger than the original Jinwa .

To build a new category, you should use a new brand, but companies generally believe that using existing brands can effectively use brand equity . This is not the case. If using a new brand means building awareness from scratch, use The original brand started from a negative number, as if repairing a house is far more difficult than rebuilding the house.Using the original brand means repairing the original cognition, which is a huge project.

When Quanxing Winery, which started from the production of low-end wines, launched an ultra-high-end brand “ Shuijingfang ”, it not only adopted an independent brand, but even registered an independent company —Shuijingfang Winery, which completely avoided the “ Shuijingfang ” wine industry. The negative impact of The new category launched by Foton Motors, which started from the production of agricultural vehicles, is the economical micro-card, which uses a new brand name "Time". This brand has achieved unprecedented success, occupying 30% of the market in this category in the highest period.

The essence of marketing competition is category disputes. The market for new categories usually comes from the old categories. The “enemy” of the categories is defined, and the source of business is determined. Where does the premium milk market come from? It may be the high-end crowd in the ordinary milk market, it may be other high-end breakfast drinks, or it may have both, but a phased emphasis must be determined.

Not only are new categories and new brands, but also old categories and brands that have established status, they also face the problem of defining competitors , otherwise, both categories and brands will be in danger of decline. Who is Lulu's opponent? It seems uncertain that it is not a good thing to actually enter the so-called "blue ocean" without opponents. The huge and urgent problem facing Lulu is to find a suitable opponent for itself.

Once create a new category, the focus of marketing is to expand around the new class, created a ripple in the domestic vitamin water category, it is almost Robust recent years, the most successful brand, before it succeeds, hardly had any advertising of Publicity and promotion, this brand is all the rage.

The bad thing is the next ad promotion , the theme is "Always meet the challenge", I don't know what it wants to say? What should pulsation do? Should promote the benefits of vitamin water compared to other mainstream beverages such as pure water and sports drinks and even tea drinks ? In other words, promote the category rather than the brand. However, most advertising companies will not accept this suggestion and idea, because in their opinion, doing so is not creative. Or you may feel that the appeal is too rational and affects the brand extension space.

A similar example is the Australian Lee, the brand created a glucose drink category, becoming the pace of development of the fastest growing beverage brands, but soon it put the focus turned to the brand promotion, this category is not much business concern and Followed up, so there was not much development, and eventually the brand disappeared.

Consumers will not refuse new product entrants , as the company envisions . Entrepreneurs ' passion for launching new categories will not resolve the indifference from the market. When the category strategy became popular in the Chinese market, SMEs had to be reminded that innovative categories are only valuable if they are accepted by consumers , otherwise, they are worthless; and only by implementing the correct tactics to advance the pace, Can be perfectly listed, otherwise, the category of strategic risks is heavy.

Launching a new category of products, through the planning of rhythmic tactical advancement, gradually achieving coexistence with leading brands, and even replacing the position of leading brands, the advanced marketing strategy that leads the entire category is called category strategy. However, many entrepreneurs are beginning to wonder: the success rate of new product launches is extremely low, let alone new categories that consumers have never seen?

According to a foreign study, the failure rate of new products is between 40% and 90%, depending on the category. The failure rate of some categories is as high as 90%. US packaging categories of goods , for example, there are 30,000 new products each year, of which 70% to 90% in the shelf placed on time is not more than 12 months. Many products are very innovative , which is equivalent to creating a new category or subverting the old category, but 47% of the market pioneers ended in failure. In other words, about half of the companies that opened new categories withdrew from the market.

"Chinese-style" new product listing methods have caused new products or categories to be listed quickly and then quickly perish.

So, how should the correct category strategy avoid the risks of the category strategy ? First, we will clarify what is the culprit for the high failure rate of category strategy; then, analyze the quality of new categories that have high success rates; finally, summarize the seven principles for avoiding category strategic risks.

Companies that want consumers to embrace innovative products face a fundamental problem: Although developers have identified these products as a necessity, consumers are reluctant to abandon existing products. Consumers usually overestimate the "psychological conversion cost " of new categories replacing old ones by three times; on the contrary, enterprises have tripled the assessment of "product performance advantages" of new categories replacing old ones. At the same time, in the face of the view that new categories are listed, the two minds have an error of "3 times × 3 times = 9 times". This contradiction leads to a misalignment between the innovator 's prediction of market demand and the actual demand of consumers , with an error of up to 9 times! This is the " nine- fold effect " proposed by Joho T. Gourville , a professor of marketing at Harvard Business School .

The "nine-fold effect" caused by mental cognitive errors is the root cause of the failure of most new product listings. Consumers' minds are difficult to change, and he will also become more and more serious according to the length of time he chooses to choose a brand. For example: If you are a young man who has preferred Coca-Cola since childhood, Wang Laoji wants to persuade you to switch to herbal tea through advertisements, which will be extremely difficult. This threshold is greater than the "nine times effect".

Consumers still choose existing brands in accordance with their original shopping habits, which is the most direct response of the human brain to avoid consumption risks. At the same time, the corporate side still does not consider the laws of consumers' minds, and according to their wishful thinking, strides into the trap of listing new products. What's more dangerous is that companies are usually unaware of this.

In the 1970s, the "Cola War" in the United States gradually heated up. Coca-Cola launched the "New Coca-Cola" campaign. In order to respond to the tooth, and respond to the "challenging" campaign of Pepsi 's taste, Coca-Cola developed a new formula that better meets people's tastes. And after a blind taste test of 200,000 people , consumers who prefer new flavors are basically three times more likely to prefer original flavors. Using the method of exposing the label and then testing, the situation is that the preference for the original Cola is 4 times that of the new flavor. With a long history of Coca-Cola, consumers have invisiblely expanded the influence of the brand's tradition and overestimated the value of the original Cola 4 times. If the first test method is in line with the thinking of the enterprise (better product), then the second method should be the true response of the market (cognition is fact). In the cola category, the cognitive error between the two minds is 3 times × 4 times = 12 times!

Later, less than 3 months, Coca-Cola announced that the original Coca-Cola was named "Classic Coca-Cola", and the original flavor returned to the market. At the same time as the Coke battle in the century-old battle, a new marketing philosophy has also begun to form, and people are thinking. What is the key force that affects the success or failure of marketing? The answer is: mind.

The premise for enterprises to avoid category strategic risks is that new categories launched must be accepted by consumers' minds. The new category is undoubtedly changed in two aspects: the change of the product itself and the change of consumer behavior. Successful categories are usually those in which the product itself changes significantly, but the usage behavior does not change much, so that such categories are easily accepted by consumers' minds.

The most obvious example is the launch of digital cameras. From film cameras to digital cameras, the product itself has changed a lot (from analog imaging to digital imaging), but the consumer's behavior has not changed much, and it can still freeze instantly and be convenient to print. What's more, it doesn't require the cost of film purchase, and it doesn't need to worry about film exposure.

In addition, some innovative categories have many advantages, but require very few behavior changes. Such products are doomed to success. The invention of the mobile phone has all the advantages of a fixed phone, and adds the convenience value of "movable" and "anytime, anywhere". Mobile phones are now one of the most dynamic categories of technology products. "Non-fried" instant noodles that can meet the health requirements of modern urban people choose to be soaked or cooked like traditional instant noodles, without any change in behavior, but consumers seem to get more benefits-health. (Regardless of the "healthier" authenticity, the advantages of the "non-fried" category undoubtedly exist.)

Generally, the failure of new product listing cases in marketing history usually means that the product has not changed much. Instead, it requires consumers to change their usage behavior greatly. Enterprises also consider themselves to be "better products."

In 1936, the Americans invented the Dvorak keyboard. This is a "perfect keyboard" that is most ergonomically proposed by analyzing the probability of using letters on a computer keyboard and combining the structure of human fingers. But it is only slightly faster than the traditional QWERTY keyboard we use today. Consumers simply do not realize its benefits, but require users to make great behavior changes. The revolution in technology was eventually "reinforced" and its "life" has not yet been promoted.

To sum up: When companies choose innovation category, to assess the innovative value of the product itself (product has obvious benefits, please?), But also to minimize consumer behavior change ( consumer behavior changed?), This is to ensure that The key to avoiding strategic risks in the category is.

I. Credibility Principle-The first issue facing the listing of new products is credibility, and new products, new concepts, and new ideas are not credible. Especially when it was first launched with advertising. At this time, the new category must be trusted by a third party. All generations of customers Konka color TVs we serve , during the Olympic Games, plan to launch "the most suitable for watching sports events" color TVs, in order to increase the credibility of new products, the use of credibility to enter the Olympic venues. "The only supplier of Water Cube " has become a major reason to overcome consumers' psychological concerns in choosing a new category of "HD Sports".

Second, the principle of opposition-the current competition is customer-oriented as the basic weight of the game, competition-oriented as the ultimate marketing idea of commercial war. The listing of a new category is necessarily a competition for customers of an existing category, and there must be sufficient alternative reasons. Often contradicted by the leading brands , they can obtain alternative positions. When a new category is listed, it is first necessary to determine the replacement object. Wang Laoji's initial stage was to set all sodas as his own opponents, and to launch an antithesis of "cooling in the body" (a beverage to prevent getting angry) for "cool surface".

Third, the principle of independence-when new category opportunities arise, if there is no independent brand, the opportunity to build a brand will be lost . If the new category is important enough, the final winner is always a new brand created specifically for the new category. The mobile phone just mentioned is an important category. The old brand Motorola has not launched a new brand, but continues to extend its brand . The new brand Nokia narrowed the battlefield, focused on the mobile phone category, and eventually became the winner. After Hisense missed the opportunity to occupy the "inverter air conditioner" category (now Midea is launching an offense), he did not look at the next-generation display technology "LED TV" independently, but continued to use this brand that has crossed several major categories-Hisense. This misses the opportunity of LED light source TV to build a new brand. Hisense, which has always attached importance to technological innovation, once again missed a good opportunity at a crucial time when Chinese home appliance companies were required to launch high-end independent brands and bid farewell to the low-cost image. Will Hisense's mistakes create opportunities for other Chinese color TV brands?

Fourth, the principle of legality-for the launch of some new categories, in order to give consumers a stronger alternative reason, hesitate to take risks, exaggerate publicity, and even illegal publicity, resulting in the failure of the final listing of the category. Harbin Pharmaceutical Group 's "slim lady" is a "slimming health drink" aimed at "simple obese people", and as soon as it was launched, it caused a sales boom. In 2005, he was investigated by a provincial bureau of industry and commerce for "suspected exaggeration". As soon as media reports came out, the supermarket was taken down. According to relevant experts, the active ingredient in slim ladies is "L-carnitine" (an important nutrient substance similar to vitamins that exists in human muscle and liver tissues). Most of the weight-loss health products are used, and it is also true With weight loss. However, before going public, the company failed to pass the inspections of relevant departments, which resulted in "slimming" becoming a company's self-talk and "misleading consumers." It was later reported that the slim lady was not filed in the relevant department and had no health permit issued by the health department. In the end, this product also disappeared.

Fifth, the principle of test marketing -insight into consumers' minds is sometimes very simple, just use common sense. However, facing the launch of new categories, entrepreneurs, because of their own roles and internal thinking, have created a situation of "I don't know the true ideas of customers and are willing to push new products together." Through trial sales, companies can determine and verify the market's acceptance and consumers' true ideas. Marketing genius Shi Yuzhu has always advocated the role of trial sales. Both Metplatin and Gold partners have determined the product form, marketing strategy, and advertising strategy through trial sales . Melatonin has been on trial sales in Jiangyin, Changzhou and other regions for up to one year. Shi Yuzhu visited more than 300 aunts in person. The combined packaging of capsules and oral solution, and the advertising slogan “Receiving gifts only for melatonin” for 10 years are the results of trial sales.

Six, the principle of time-the new category will inevitably face a long and long process of market recognition, the longer the time, the deeper the education, the more difficult it is for latecomers to shake your position. New Oriental was established in 1993 and went public on the New York Stock Exchange in 2006, which took 13 years. Even the industry's fastest growing network, the superstar Alibaba , was founded in 1998 and went public in 2007, after 9 years. If you want to shorten this process artificially, you are doomed to fail. The "Biao Wang" created by CCTV in the 1990s has fallen, which is why. However, there are still many companies try to shorten this process, "explosive", "carpet" of advertising bombardment , if the market will not be achieved overnight, funds can not keep up, marketing to a halt, new products embarrassed retreat City , which is typical Chinese style new category failed.

VII. Funding Principles—To make the new category popular, enough funds need to be invested; subsequently, to make the marketing wheel of the enterprise run, it also needs funds as a motive force for maintenance. For small businesses with a passion for innovation in new categories, the marketing world is unfair. The idea of ​​"juice + milk" born in Xiaoyangren in 2003 has produced China's earliest new category of "fruit and milk drinks". Now, it is occupied by the relatively powerful "Nutrition Express" of Wahaha 's "Pure Fruit Juice + Fragrant Milk". Later, in order to strengthen the occupation of this category, Wahaha developed the "Samo C".