Imagine you’re running a fast-food restaurant. Children love your snacks, and parents enjoy indulging them at your colorful café. Working professionals in the surrounding area consider your place whenever they step out for a quick break. Business seems to be doing well.
And then, one day… enter a competitor.
A coffee place. Within a month of opening, they start enticing your customers with their cheerful cappuccinos and lattes. Previously, your restaurant was the go-to place for office-goers who skipped breakfast at home. Now, it’s the new cappuccino place.
What would you do?
On a hunch, you’d probably add to your menu a variety of cappuccinos and lattes to be on par with this competitor. Sounds good?
This is a true story of how McDonald’s won its customers back by creating a point of parity with the competition.
Point of parity (POPs)? Why does that sound familiar?
Defining Points of parity (POPs)
Let’s discuss this with an example. Before the invention of the mobile phone, who would have thought a camera would be an essential feature in a phone? Would any manufacturer today dare to develop a mobile phone without a camera? This, right here, is a point of parity.
For a manufacturer to survive in the smartphone industry, having features like a touchscreen interface, internet connectivity, and a camera is a must. These are the basic expectations from a smartphone category.
The above examples are considered to be category-based points of parity.
Points of parity could also be competitor-based.
Let’s say, for a car brand, if leather interiors are a feature offered by all major competitors, this would be a competitor-based point of parity.
What’s the significance of points of parity?
Marketers go on and on about differentiating your brand – Points of Differentiation (PODs) and carving out Unique Selling Propositions (USPs).
While PODs and USPs highlight what makes your brand unique, points of parity highlight similar attributes or industry standards that you need, to be on par with your competitors.
These attributes are not exclusive to your brand, and they don’t necessarily make your brand better than the others, but then, your brand won’t be excluded on account of lacking a particular characteristic the customer looks for.
Let’s take the age-old rivalry between Coca-Cola and Pepsi as an example. While the two brands differentiate themselves through distinct flavors and marketing strategies, they also have numerous points of parity. Both offer cola-flavored beverages, come in similar packaging formats, and invest heavily in advertising and sponsorship deals to maintain their presence in the market.
With Points of parity, you can
- Establish your brand’s credibility
You satisfy the fundamental needs of your customers. You consistently serve your customers by meeting industry standards for a significant period of time. Eventually, you earn a place for yourself as a credible player in the industry.
- Adapt to evolving trends
Keep an eye on market trends and evolving customer expectations. What is considered a point of parity today might change, requiring your brand to adapt. Consistently highlight your shared attributes with the industry benchmarks and reassure your customers that your brand delivers the essential benefits they seek.
For instance, McDonald’s faced negative publicity from advocates of healthy eating, which threatened its market position. In response, McDonald’s introduced salads and fruit smoothies to its menu, ensuring it met the growing consumer demand for healthier options. This strategic move allowed McDonald’s to maintain its relevance and appeal to health-conscious customers without sacrificing its core offerings.
McDonald’s strikes again!
- Innovate beyond parity
Stop your competitors from eating into your hard-earned market sharẹ. Constantly monitor your competitors and stay ahead of them. Upgrade your offering to exceed customer expectations to enhance your customer loyalty.
For example, cup holders in cars weren’t initially considered a necessary feature by many manufacturers, who feared they might be seen as a distraction. They were wrong. Cup holders became a standard expectation, a point of parity in the automotive industry.
Identify your brand’s Points of Parity with Research
Bottomline
Striking a balance between parity and differentiation is essential to sustain in a competitive arena of brands.
Since Points of parity signify the essential attributes that align a brand with industry standards, identifying and implementing them helps in establishing market relevance and achieving competitive parity.
Overall, PoPs serve as a baseline for credibility, helping businesses navigate consumer expectations and build a strong position in the marketplace.
