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Three Questions You Need to Ask About Your Brand | Part Two

The agency was focusing almost exclusively on Subway’s key point of difference from other fast-food restaurants: healthfulness. But Subway’s executives were concerned about the brand’s competitive frame of reference and the attendant points of parity. While they were eager to reposition the brand—sales had been flat for two years—they saw taste as the sine qua non of the fast-food frame of reference and believed that taste is more important than healthfulness to core fast-food customers. Subway’s research suggested that the company, which has more stores than any other fast-food operation, could successfully compete on taste with the burger giants, whose sales dwarf Subway’s. And executives knew that fast-food consumers often perceive good taste and healthfulness to be at odds. Management feared that a strong health-centered campaign would jeopardize the perception of Subway as a fast-food establishment.

Subway began running the agency’s advertisements nationwide. But recently it has been simultaneously running another campaign promoting new products on the basis of taste. Whichever approach turns out to be right for the brand in the long term, the example shows that brand positioning focusing only on a point of difference leaves out important issues. Sound competitive positioning requires the identification of an appropriate frame of reference and associated points of parity and points of difference. Subway can continue to differentiate, of course—differentiating is a smart way to keep other potential health-focused fast-food purveyors out of its business—but it can’t forget what business it’s in.