Aug 28, 2017
Low differentiation, decreasing relevance and reducing loyalty are all factors contributing to the commoditization of brands in certain product categories, as identified by latest findings from Y&R Singapore’s BAV business intelligence.
The categories where brands are most at risk of becoming less relevant to Singaporean consumers include Department Stores, Insurance, Banks, Beauty, Newspapers, and Alcoholic Beverages. This is based on comparative BAV Singapore data over the past ten years, measuring brand perception based on various key attributes and characteristics.
Commenting on the findings, Mittu Torka, Y&R Singapore’s Head of Planning says, “2017 BAV data indicates that brands in each of these categories now hold less power to pull and retain consumers across segments, affecting their ability to charge a premium for their products. Over time, the only factors distinguishing these categories’ brands from each other will become pricing and availability.”
The situation looks promising for categories where brands are leading in relevancy, differentiation, and trust among Singaporeans, namely Educational Institutions, Payments Solutions, Chocolates, Mobile Phones, and Computers.
“Consumers are excited about brands from these categories because they’re constantly offering something new and exciting while continuing to stay relevant and trustworthy. If the commoditized brands apply the learnings from these category leaders, they would be able to gain greater relevancy and improve their standing in the consumer’s eyes,” explains Mittu.
She continues, “In the category-neutral minds of consumers, brands from the 6 categories mentioned above would need to spend extra media dollars just to compete with the trailing brands in leading categories – which amounts to ineffective marketing economics. And if the comparative set was from the same category, it wouldn’t solve the larger issue of commoditization. BAV and Y&R help brands learn from leaders beyond their category and elevate their brand while disrupting the market.”
Adds Shirley Tay, CEO, Y&R Singapore, “We’re excited for what BAV means for clients. It is an invaluable business tool for mapping perceptions of brands compared to their peers. Most importantly, it allows brands to shape their future by uncovering and adopting attributes of leading brands. It can also be used to spot opportunities for portfolio expansion and strategic partnerships, which is good news for hyper commoditized categories. A powerful data platform that helps businesses move beyond category limitations, BAV can help brands forge more meaningful relationships with Singaporean consumers.”
Originally posted on WPP