The Three Laws of the Marketing Chain of Being
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Quick Summary: Read about the five levels in the Marketing Chain of Being, and the three laws that govern how brands move between them.
In an earlier post, I had written that, like the Renaissance Chain of Being, there is also a Marketing Chain of Being.
In this post, I’ll explain the five levels in the Marketing Chain of Being, and the three laws that govern how brands move between them.
There are five levels in the Marketing Chain of Being –
1. Commodity Hell, in which brands basically focus on price and channel promotions to sell more (think groceries).
2. Differentiation, in which brands highlight product features and benefits to command a price premium (think automobiles).
3. Engagement, in which brands use service (in both its customer service and conversation meaning) to develop relationships with customers (think Dell).
4. Cultural Currency, in which brands become shared social objects and help customers define their individual and group identities (think Nike+iPod).
5. Meaning, in which brands become the tools that customers use for self-realization or restoration (think Google).
There are three laws that govern how brand move up the levels in the Marketing Chain of Being.
The first law is that all brands want to move up the Marketing Chain of Being.
As a brand moves up the Marketing Chain of Being from a lower level to a higher level, it unlocks additional degrees of freedom to increase revenues, profits and customer satisfaction.
For instance, when a brand moves up from commodity hell to differentiation, it adds product features and benefits to its marketing arsenal which had only price and channel promotions earlier.
This doesn’t mean that the brand suddenly stops using price and channel promotions. It just means that the brand can choose to use the price and channel promotion strategy when it wants to and the product features and benefits strategy when it wants to, based on the demands of the specific situation.
This freedom is important because it allows the brand to use the optimal strategy in any given situation. Since the product features and benefits strategy is fundamentally more powerful, the brand will tend to use it predominantly until it is forced to rely upon the price and channel promotion strategy in a specific situation.
What’s also important is that until the brand moves to the engagement level, it can only use these two strategies; it cannot use the service experience strategy which is a fundamentally more powerful strategy than either of the strategies available to it.
Therefore, there’s no reason for a brand to want to stay at a lower level in the Marketing Chain of Being if it is possible for it to move to a higher level.
The second law is most brands can move up the Marketing Chain of Being.
All brands do not start at the same level in the Marketing Chain of Being.
Some brands compete in product or geographical markets dominated by a particular strategy. Other brands are owned by organizations that have strengths and weaknesses in a particular strategy. Still other brands are in the right organizations/ markets but are forced to follow a particular strategy because of other legacy issues.
What’s important is that most brands can move up the Marketing Chain of Being.
It’s not very difficult to draw a roadmap for how a brand can move from commodity hell to differentiation to engagement. The movement up the lower half of the Marketing Chain of Being involves a mix of art and science that can be mastered with the right degree of discipline backed up the required amount of resources.
It’s almost impossible, on the other hand, to draw a roadmap for how a brand can move from engagement to cultural currency to meaning. The movement up the upper half of the Marketing Chain of Being moves away from the realm of discipline into the realm of inspiration. Brands that are at the cultural currency and meaning levels seem to have appeared there out of thin air, as if by magic.
The third law is that very few brands do move up the Marketing Chain of Being.
Typically, within and across product or geographical markets, the number of brands at a lower level is much larger than the number of brands at the next higher level.
It’s difficult to put numbers against this argument, but I won’t be surprised if for every 1 brand that is at the meaning level (and probably we can count them on our fingertips), there are 10 at the cultural currency level, 100 at the engagement level, 1000 at the differentiation level and 10000 at the commodity hell level.
Therefore, the Marketing Chain of Being can also be represented as a pyramid.
Why do only a few brands move up the Marketing Chain of Being when all of them want to and most of them can?
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