Do brands really need to differentiate in a meaningful way? Nigel Hollis, chief global analyst at Millward Brown, considers the evidence.

This statement is both provocative and memorable, but in setting difference versus distinctiveness Sharp is creating an unnecessary conflict. Difference and distinctiveness are two individual qualities often associated with the same brand.

Perceived differentiation is driven more by whether people view the brand as unique: think Burberry or, setting the trends for its category, think Apple.

Difference can be driven by an innovative product, positioning or even tone of voice. Distinctiveness is driven by sensory and semantic cues that make the brand easy to recognise, for example colours, packaging, logo, design or taglines. Given those definitions it becomes obvious that Burberry and Apple are both different and distinctive. Similarly, design spans both qualities, on one hand informing how the brand is used and on the other how it looks.

Sharp downplays the role of differentiation in marketing because he defines marketing success as capturing a high market share and ignores the role of pricing. Our research confirms that perceived differentiation has relatively little influence on current demand in most categories, but finds that it is strongly related to a brand’s ability to command a price premium over close alternatives. Integration of attitudinal survey data with behavioral sales data finds that people will pay up to 40% more for brands that they perceive as meaningfully different.

In part this is because people buy different brands. Upmarket brands are more likely to be seen as meaningful and different and are valued more highly by most shoppers. However, even when dealing with value brands that are cheaper than the category average people will pay more for a brand if they perceive it to be more meaningful and different.

Even if the price paid is only a couple of percent higher, that will have a far bigger profit impact than selling more volume because all the money falls to the bottom line. When it comes to brands a feeling of difference can be worth a lot.

Distinctive brand

Sharp champions distinctiveness on the grounds that distinctive brand cues help the brand to be salient, easily recognised and triggering an instinctive, positive reaction from potential buyers. No argument there; distinctiveness helps prime people to buy.

However, while Sharp offers no measure of distinctiveness in How Brands Grow, the available data suggests his juxtaposition of difference and distinctiveness is completely unnecessary.

Last year’s BrandZ survey (WPP’s global brand equity study) included measures of both difference and distinctiveness. Comparing the two for nearly 5,000 brands finds that while most brands are slightly more likely to be seen as having a distinctive appearance than standing for something unique, the two concepts are strongly correlated – even when we remove the influence of brand size (r=0.78).

Admittedly, distinctiveness might be better measured by implicit methods rather than explicit questions but even so, the data suggest that the two qualities are related.

In the US, some like Amazon and cereal brand Kashi are more likely to be seen as different than distinctive, while others are more distinctive than different, including Jaguar and Fiji Water. Many of the strongest brands in BrandZ are seen as both distinctive and standing for something unique – for instance, Guinness, Pampers, Trader Joe’s, Under Armour and the Apple iPhone – but these are the exceptions, not the rule. Unfortunately, the overall finding from the comparison must be that most brands are perceived to be weakly different and weakly distinctive.

Looking at the BrandZ data, my overall conclusion is somewhat different from Sharp’s. Marketers need to strive to make their brands both different and distinctive: different in order to justify a price premium over close alternatives, distinctive in order to trigger pre-existing, positive feelings during search or shopping.

The two qualities are both highly desirable but, sadly, most brands are lacking in both. Remedying that situation starts with knowing what the brand can stand for – what will make it meaningfully different to its consumer – then reflecting that difference in all aspects of the brand experience, from product design to advertising and point of sale. That way your brand will be able to deliver a one-two punch that is both different and distinctive.