The future of the brand benefits ladder: our view
Since the beginning of the 80s both marketing researchers and practitioners sought ways of moving beyond the practice of marketing products by features – what Kotler describes as Marketing 1.0. This movement represents the inception of the brand benefit ladder. And the term ladder derives from the ‘laddering technique’ of connecting product and brand attributes to the realm of consumers’ personal and social values. The traditional brand ladder includes three categories, bottom to top:
- Attributes: also known as technical benefits. This is about how fast your super-car speeds to 100 km/h; how much pressure per square inch your iron can produce;
- Functional benefits: those deal with the ability of a product and/or brand to accomplish a task. A laundry detergent is expected to clean and/or soften garments. Whitening toothpaste is expected to clean and keep white your teeth.
- Emotional benefits: this is how the product and brand experience make you feel. For certain consumers using a fabric softener delivers a sense of freedom, for others a brand is an important way of fitting in their peer group, it provides them with a sense of belonging.
In 2011 BCG consultants proposed to amend the model, by explicitly taking in consideration a fourth dimension: the social benefit. Given the increasing importance of segmentation of consumers based on their category adoption preference, they propose to consider a new set of benefits, which tell who we are as consumers: are we leading edge fashionistas? Are we an early majority technology enthusiast? Are we a fine liquors connoisseur?
While very important and relevant, we believe that there is a need for a forth category of benefits on top of the ladder, but one which deals with our values as citizens.
Before arriving to the new shape of the ladder, we want to consider two consumer trends and one rising marketing-industry development, which are the driving forces beyond the need to change the ladder:
1) Emergence of the ‘Lohas’ and their influence on consumption: Lifestyles Of Health And Sustainability are expected to represent 20% of developed countries population, with a potential market of ca. 400 Billion USD. These consumers make conscious choices of organic food, sustainable and efficient appliances, solar panels and eco-tourism. They are aware of their carbon footprint and this knowledge drives their consumption patterns. And while the LOHAS are happy to pay a premium for the right product or brand, more and more consumers are becoming sustainability conscious, although they are not willing to pay more for sustainable products and or brands. They just stop buying products and brands from companies whose values are not theirs. They want to be reassured that the workers conditions are proper, that they used energy-efficient manufacturing processes, and that these brands belong to good corporate citizens. In a nutshell, the bar is rising, and while only a smaller portion of the population is trading-up to the ‘sustainable’ category, the great majority is about to exclude from their basket of choice products and brands which are not in line with the common sustainability concerns.
2) Millennials: in the next 20 years they will be becoming the majority of the workforce, and the driving force behind many physical and digital purchases. And the way they enter the world is different. For example they use meta engines for checking different travel options, but then prefer to make a last minute purchase on-line and directly to the airline of choice. They also on average change their reservation more often then any other consumer demographic. In a recent study we produced on beer and cocktails, we discovered that Millennials tend to drink more premium brands, and while they are adopters of global brands, they will choose for a locally produced brand if it is available. This is because they care of what happens in their society and prefer to work for- and purchase from- companies that have a vested interest in their society.
3) Marketing 3.0: In Prof. Kotler’s recent work on the evolution of marketing, it is evident that the evolution from functional marketing to emotional (from ‘1.0 to 2.0’) it is now superseded by a new marketing dimension: how a company deals with their social responsibilities.
We therefore believe that a brand/product ladder needs to take in consideration a fourth category, the societal benefits: this set is composed by three subsets, each one delivering benefit on one association
a) The association of the consumer and the society: e.g. how the brand makes the consumer a better member of the society, by either means of education, self-promotion, and belonging. For example the Pampers Unicef campaign.
b) The association of the brand with the society: e.g. how the brand is ‘playing’ in its on community (e.g. Tide loads of Hope in support of families affected by disaster)
c) The association between the brand, the consumer and the society, where the three come to meet and identify e.g.: the FairTrade Mark from the FairTrade foundation
In conclusion, by including the societal benefit in the brand ladder, we can ensure that our positioning statements can deliver on essential dimensions from a consumer point of view, now and especially in the next 20 years.
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