Today, in our data-abundant, Internet-oriented world—driven increasingly by the evolving nature of personally applied technology—marketers must have more than a shallow or superficial understanding of the customer or consumer. In this new post Great Recession world, the three P’s (penetration, preference, and price-value) must replace the three A’s (availability, acceptability, and affordability) because they are more relevant to driving sales and to creating consumer or customer demand.
Penetration and the Digital World
Penetration does not simply refer to how deeply a brand has penetrated a market. It also refers to how deeply a brand has penetrated the consciousness of the consumer. And, in this new digital world, to drive penetration, marketers must create a desire for the product that stimulates purchase. To accomplish this, marketers must enter the consumer or customer’s mind by making connections that are relevant to the environment and to their mind-set. Marketing must create an “ownable” environment for the product or service, which requires the right brand, right package, right configuration, right channel, and right message—oftentimes in 140 characters or less.
The Penetration Master
Nowhere is this better substantiated then in the July 26, 2011, Bloomberg story “Apple Tops $400, Chases Exxon as World’s Most Valuable Company” which affirms Apples ascendancy and confirms that consumer taste has overtaken the needs of business as the leading force shaping technology:
“Apple, on the brink of bankruptcy when Chief Executive Officer Steve Jobs reclaimed the top job more than a decade ago, now has a bigger market value than Microsoft Corp. (MSFT) and Intel Corp. (INTC) combined, fueled by new products such as the iPhone and iPad. Shares are up from a stock-adjusted $5.48 on Sept. 16, 1997, the day Jobs returned after his 1985 ouster [to $403.41].
The stock price gives Cupertino, California-based Apple a market capitalization of about $374 billion, trailing by $41.6 billion the $416 billion value of Irving, Texas-based Exxon.”
Critically, Apple creates a pervasive environment that compels and drives the consumer to buy and matches it with unparalleled manufacturing and distribution prowess and exquisite industrial product design. And with Apple, it’s always about reinvention-led innovation—that’s its core essence, and the key attribute consumers associate with the brand.
Preference and Brand Reinvention
In building or reinventing a brand, while differentiation may be a motivating factor, preference is even more crucial. Consumers will pay a higher price for the brands they prefer. Simply, affordability is not about price; it’s about the value derived from the product or service by the consumer or customer.
This is particularly applicable to Apple, which uses an interesting method to drive value. Michael Gartenberg at Macworld .com discusses Apple’s approach:
The key to Apple’s success is that the company often takes the time to explain things to the consumer that no other vendor bothers to do. By keeping a laser focus on key features and introducing them one at a time over a period of years, Apple taught and evangelized everything the consumer needed to know to understand the iPad from day one. Without that foundation, it’s not likely the product would have been nearly the success it has been.
Conversely, other competitors like Dell and Lenovo have failed miserably because they weren’t as effective at story-telling or at providing a successful hands-on retail experience.
Price Value and Brand Values
Microsoft is, without a doubt, a behemoth. But consumers don’t brag about upgrading to Microsoft Office like they do about getting the newest iPhone on a 4G network. With Apple, it’s about a total experience, not a product. With Microsoft it’s about—well, it’s about attempting to reinvent itself. If any company has lost its way, Microsoft has. Its advertising featuring a broad spectrum of typical users promoting that “Windows 7 was my idea” pales when compared to Apple’s creativity and pervasiveness. The idea that Microsoft listens to its customers is greeted with skepticism, while Apple’s intrusiveness is welcomed—as a window into the new world.
For these reasons, as well as for many others, price should be communicated in context of other brand values—never in isolation. Consumers need reasons—functional and nonfunctional, rational and emotional—to buy a brand. And, these reasons must come from the brand positioning.
The New Rules of Marketing: Principle # 9
Penetration, preference, and price-value must be the key drivers of any marketing plan in today’s global marketplace. Why? Penetration creates the pervasiveness for the product or service that stimulates purchase. Acceptability is not a differentiator. If you don’t know your company’s or your brand’s value proposition, you can’t determine new ways to leverage it or expand on it to create differentiation and drive preference. Lastly, emphasizing value creates a brand; emphasizing price creates a commodity.
Author: Timothy R. Pearson is founder and president of Pearson Advisors || Partners, a marketing management consulting firm serving Fortune 1000 and brand-driven clients; a highly sought advisor to senior management; and a frequent keynote speaker at industry conferences, at leadership meetings, and on the lecture circuit. The rules that are summarized in this post along with the 23 underlying principles are explored in greater depth in his new book The Old Rules of Marketing are Dead: 6 New Rules to Reinvent Your Brand & Reignite Your Business. (McGraw-Hill 2011) Visit www.pearsonadvisorsandpartners.com.
 I believe this was originally used at Coca-Cola marketing in the 1980s; it was also used by Zyman Group, the marketing consulting firm that I led, during my time there as president and CEO (2005–2007).
Adam Satariano, “Apple Tops $400, Chases Exxon as World’s Most Valuable Company” Bloomberg, July 26, 2011, http://www.bloomberg.com/news/2011-07-26/apple-tops-400-gaining-ground-on-exxon-as-world-s-most-valuable-company.html
 Michael Gartenberg, “Apple’s Secret Weapon: Consumer Education,” Macworld, May 27, 2010, http://www.macworld.com/article/151606/2010/ 05/gartenberg_ipad.html