Chapter 5 – Our Buyers Are Different

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These posts are a collection of notes and summaries from the book “How Brands Grow: What marketers don’t know” by professor Byron Sharp. This work is a must read for any marketer. My personal goal when I embarked on this series of posts was to get a deeper understanding of the book and its lessons, and as I have worked through them I have not only gained that understanding, but also an idea of the areas I need to investigate more deeply in the future. Sharp is always very insightful, but I feel the need for more perspectives on many of the topics he covers. You can buy How Brands Grow here.

The fifth chapter of “How brands grow” highlights how similar the customer base is for analogous category products. This thesis has important implications for how we think about market competition: rival brands sell to very similar customer bases

Yet, this isn’t equally true for every pair of ‘analogous’ products.

If you take Gucci and Zara they are both two fashion companies, but their target is completely different. The author, probably, would argue that they are not similar.

Indeed if we want we can say that the first one is a luxury brand and the second is not, but this for me depends on the level of focus that we want to have in the discussion. We can say, at the same time, that they are comparable products or not, choosing a different level of detail. 

The idea of sharing the same customer base might appear strange because the commonly held belief in marketing theory is that:

Differentiated brands sell to different groups of people.

Nevertheless, Bryon Sharp’s thesis that similar companies end up chasing (after) the same potential customers is supported by an experiment led in 1959 by a professor at University of Hawaii.

The research focused on the relationship between personality characteristics and car ownership. 

Thanks to Anna Shvets for this picture

The starting assumption was the existence of a strong correlation between brand and personality characteristics. 

To prove the thesis the research selected people who owned Ford and Chevrolet cars. 

The research ended showing how personality and demographic profiles of Ford and Chevrolet were essentially identical. 

Several other studies conducted during the following years are quoted and they showed the same results.

Again: competing brands sell to the same sort of people. 

Within each brand’s customer base there is a lot of variation, but each brand has the same variation”. 

The fifth chapter is rich of additional analysis providing strong robustness to the thesis.

Owners of:I cannot bear untidinessI keep up with technologyI judge people by the car they driveA car is only to get from A to B
% Agreeing% Agreeing% Agreeing% Agreeing
Rover1611118
Escort199321
Sierra179217
Cavalier1710317
Average1810218
Owners of different car brands hold similar values, UK 1990s Source TGI

For the authors there are also obvious exceptions, for example Scottish newspapers have more readers in Scotland than the average newspaper brand or very expensive brands have fewer poor people in their customer base.

I don’t know how obvious it is, but it is a really good point.

Target customer base and target market exist

It explains that a target customer base and target market exist, but they are not “unique”, instead they are shared through the other similar categories (same luxury products, same local newspapers etc….).

If I correctly understood the author’s goal, he doesn’t want to deny the importance of branding or understanding a brand’s customer base, but he wants to avoid overthinking on differentiation and its role for growth. 

And I really understand the author’s point because it happened also to me to hear very strange justification masked under “market segmentation” or “market niche” words, while actually they were just very small markets. 

It’s not a niche market, is just a small one

But you should not underrate the importance of understanding your customer base, just don’t be overconfident on the loyalty and behaviour of them compared with your competitors.

To conclude, this chapter highlights a key point on competition: although some brands claim their customers are unique, this is not always the case.

In fact, very often (but not always) customers could be yours and vice versa.

For that reason, brands need a strong marketing department to defend and grow their customer base. 

Additional Readings

Evans, F 1959, ‘Psychological and objective factors in the prediction of brand
choice Ford versus Chevrolet’, The Journal of Business, vol. 32, pp. 340-69.

Kennedy, Rachel, Ehrenberg, Andrew & Long, Steven 2000, ‘Competitive
brands’ user-profiles hardly differ’, Market Research Society Conference,
Brighton, UK.

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