I recently read an article in the Harvard Business Review titled ‘A Better Way to Map Brand Strategy’ by
Niraj Dawar and Charan K. Bagga.
If you haven’t already, I’d recommend reading the article in full.
For the time being, however, I wanted to quote the article’s definition of “Centrality” and “Distinctiveness” when used in reference to a brand’s position within a category.
I’ve added a line break to separate the two definitions.
“Central brands, such as Coca-Cola in soft drinks and McDonald’s in fast food, are those that are most representative of their type. They’re the first ones to come to mind, and they serve as reference points for comparison. These brands shape category dynamics, including consumer preferences, pricing, and the pace and direction of innovation.
Distinctive brands, such as Tesla in cars and Dos Equis in beer, stand out from the crowd and avoid direct competition with widely popular central brands.”
One is an archetype, the other tries hard to not be.
But perhaps more interestingly:
“In both the car and beer markets, the higher a brand scores on centrality, the greater its sales volume. (…) In contrast, increased distinctiveness is associated with lower sales volume. (…) Why do so many brands aim for the crowded higher-distinctiveness quadrants? (…) The answer lies in the higher prices that more distinctive brands can charge.”
A simple rule of thumb.
Central brands command higher volumes, distinctive brands command higher prices.