Positioning (marketing)
Encyclopedia
In marketing
Marketing
Marketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...

, positioning has come to mean the process by which marketers try to create an image or identity in the minds of their target market for its product
Product (business)
In general, the product is defined as a "thing produced by labor or effort" or the "result of an act or a process", and stems from the verb produce, from the Latin prōdūce ' lead or bring forth'. Since 1575, the word "product" has referred to anything produced...

, brand
Brand
The American Marketing Association defines a brand as a "Name, term, design, symbol, or any other feature that identifies one seller's good or service as distinct from those of other sellers."...

, or organization.

Re-positioning involves changing the identity of a product, relative to the identity of competing products, in the collective minds of the target market.

De-positioning involves attempting to change the identity of competing products, relative to the identity of your own product, in the collective minds of the target market.

The original work on Positioning was consumer marketing oriented, and was not as much focused on the question relative to competitive products as much as it was focused on cutting through the ambient "noise" and establishing a moment of real contact with the intended recipient. In the classic example of Avis
Avis Rent A Car System
Avis Rent a Car System, LLC is a car rental company headquartered in Parsippany-Troy Hills Township, New Jersey, United States. Avis, Budget Rent a Car and Budget Truck Rental are all units of Avis Budget Group....

 claiming "No.2, We Try Harder", the point was to say something so shocking (it was by the standards of the day) that it cleared space in your brain and made you forget all about who was #1, and not to make some philosophical point about being "hungry" for business.

The growth of high-tech titties marketing may have had much to do with the shift in definition towards competitive positioning. An important component of hi-tech marketing in the age of the world wide web
World Wide Web
The World Wide Web is a system of interlinked hypertext documents accessed via the Internet...

 is positioning in major search engines such as Google, Yahoo and Bing, which can be accomplished through Search Engine Optimization
Search engine optimization
Search engine optimization is the process of improving the visibility of a website or a web page in search engines via the "natural" or un-paid search results...

 , also known as SEO. This is an especially important component when attempting to improve competitive positioning among a younger demographic, which tends to be web oriented in their shopping and purchasing habits as a result of being highly connected and involved in social media in general.

Definitions

Although there are different definitions of Brand Positioning, probably the most common is: identifying a market niche for a brand, product or service utilizing traditional marketing placement strategies (i.e. price, promotion, distribution, packaging,and competition).

Also positioning is defined as the way by which the marketers creates impression in the customers mind.

Positioning is a concept in marketing which was first introduced by Jack Trout ( "Industrial Marketing" Magazine- June/1969) and then popularized by Al Ries and Jack Trout in their bestseller book "Positioning - The Battle for Your Mind." (McGraw-Hill 1981)

This differs slightly from the context in which the term was first published in 1969 by Jack Trout
Jack Trout
Jack Trout is among the world’s most famous marketing gurus. Over the 40 years of marketing consultancy work, Jack Trout has engaged in hundreds of assignments all over the globe...

 in the paper "Positioning" is a game people play in today’s me-too market place" in the publication Industrial Marketing, in which the case is made that the typical consumer is overwhelmed with unwanted advertising, and has a natural tendency to discard all information that does not immediately find a comfortable (and empty) slot in the consumers mind. It was then expanded into their ground-breaking first book, "Positioning: The Battle for Your Mind," in which they define Positioning as "an organized system for finding a window in the mind. It is based on the concept that communication can only take place at the right time and under the right circumstances" (p. 19 of 2001 paperback edition).

What most will agree on is that Positioning is something (perception) that happens in the minds of the target market
Target market
A target market is a group of customers that the business has decided to aim its marketing efforts and ultimately its merchandise. A well-defined target market is the first element to a marketing strategy...

. It is the aggregate perception the market has of a particular company, product or service in relation to their perceptions of the competitors in the same category. It will happen whether or not a company's management is proactive, reactive or passive about the on-going process of evolving a position. But a company can positively influence the perceptions through enlightened strategic actions.

Positioning Statement (As written in the highly revered book Crossing the Chasm. Copyright 1991, by Geoffrey Moore, HarperCollins Publishers)
For (target customer)
Who (statement of the need or opportunity)
The (product name) is a (product category)
That (statement of key benefit – that is, compelling reason to buy)
Unlike (primary competitive alternative)
Our product (statement of primary differentiation)

Differentiation in the context of business is what a company can hang its hat on that no other business can. For example, for some companies this is being the least expensive. Other companies credit themselves with being the first or the fastest. Whatever it is a business can use to stand out from the rest is called differentiation. Differentiation in today’s over-crowded marketplace is a business imperative, not only in terms of a company’s success, but also for its continuing survival.*

Brand positioning process

Effective Brand Positioning is contingent upon identifying and communicating a brand's uniqueness, differentiation and verifiable value. It is important to note that "me too" brand positioning contradicts the notion of differentiation and should be avoided at all costs. This type of copycat brand positioning only works if the business offers its solutions at a significant discount over the other competitor(s).

Generally, the brand positioning process involves:
  1. Identifying the business's direct competition (could include players that offer your product/service amongst a larger portfolio of solutions)
  2. Understanding how each competitor is positioning their business today (e.g. claiming to be the fastest, cheapest, largest, the #1 provider, etc.)
  3. Documenting the provider's own positioning as it exists today (may not exist if startup business)
  4. Comparing the company's positioning to its competitors' to identify viable areas for differentiation
  5. Developing a distinctive, differentiating and value-based brand positioning statement, key messages and customer value propositions.

Product positioning process

Generally, the product positioning process involves:
  1. Defining the market in which the product or brand will compete (who the relevant buyers are)
  2. Identifying the attributes (also called dimensions) that define the product 'space'
  3. Collecting information from a sample of customers about their perceptions of each product on the relevant attributes
  4. Determine each product's share of mind
    Mind share
    Mind share, or the development of consumer awareness or popularity, is one of the main objectives of advertising and promotion. When people think of examples of a product type or category, they usually think of a limited number of brand names. For example, a prospective buyer of a college education...

  5. Determine each product's current location in the product space
  6. Determine the target market's preferred combination of attributes (referred to as an ideal vector)
  7. Examine the fit between:
    • The position of your product
    • The position of the ideal vector

Positioning concepts

More generally, there are three types of positioning concepts:
  1. Functional positions
    • Solve problems
    • Provide benefits to customers
    • Get favorable perception by investors (stock profile) and lenders
  2. Symbolic positions
    • Self-image enhancement
    • Ego identification
    • Belongingness and social meaningfulness
    • Affective fulfillment
  3. Experiential positions
    • Provide sensory stimulation
    • Provide cognitive stimulation

Measuring the positioning

Positioning is facilitated by a graphical technique called perceptual mapping
Perceptual mapping
Perceptual mapping is a graphics technique used by asset marketers that attempts to visually display the perceptions of customers or potential customers. Typically the position of a product, product line, brand, or company is displayed relative to their competition.Perceptual maps can have any...

, various survey
Statistical survey
Survey methodology is the field that studies surveys, that is, the sample of individuals from a population with a view towards making statistical inferences about the population using the sample. Polls about public opinion, such as political beliefs, are reported in the news media in democracies....

 techniques, and statistical techniques like multi dimensional scaling, factor analysis
Factor analysis
Factor analysis is a statistical method used to describe variability among observed, correlated variables in terms of a potentially lower number of unobserved, uncorrelated variables called factors. In other words, it is possible, for example, that variations in three or four observed variables...

, conjoint analysis
Conjoint analysis (in marketing)
Conjoint analysis is a statistical technique used in market research to determine how people value different features that make up an individual product or service....

, and logit analysis. POSE Analysis offers a somewhat more sophisticated approach than perceptual mapping and allows one to not only determine the positioning of a brand but also the overal strength of a brand's proposition.

Repositioning a company

In volatile markets, it can be necessary - even urgent - to reposition an entire company, rather than just a product line or brand. When Goldman Sachs and Morgan Stanley suddenly shifted from investment to commercial banks, for example, the expectations of investors, employees, clients and regulators all needed to shift, and each company needed to influence how these perceptions changed. Doing so involves repositioning the entire firm.

This is especially true of small and medium-sized firms, many of which often lack strong brands for individual product lines. In a prolonged recession, business approaches that were effective during healthy economies often become ineffective and it becomes necessary to change a firm's positioning. Upscale restaurants, for example, which previously flourished on expense account dinners and corporate events, may for the first time need to stress value as a sale tool.

Repositioning a company involves more than a marketing challenge. It involves making hard decisions about how a market is shifting and how a firm's competitors will react. Often these decisions must be made without the benefit of sufficient information, simply because the definition of "volatility" is that change becomes
cult or impossible to predict.

See also

  • Brand management
    Brand management
    Brand management is the application of marketing techniques to a specific product, product line, or brand.The discipline of brand management was started at Procter & Gamble as a result of a famous memo by Neil H...

  • Brand community
    Brand community
    A brand community is a community formed on the basis of attachment to a product or marque. Recent developments in marketing and in research in consumer behavior result in stressing the connection between brand, individual identity and culture. Among the concepts developed to explain the behavior of...

  • Customer engagement
    Customer engagement
    Customer engagement refers to the engagement of customers with one another, with a company or a brand. The initiative for engagement can be either consumer- or company-led and the medium of engagement can be on or offline....

  • Marketing
    Marketing
    Marketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...

  • Marketing management
    Marketing management
    Marketing management is a business discipline which is focused on the practical application of marketing techniques and the management of a firm's marketing resources and activities...

  • Target market
    Target market
    A target market is a group of customers that the business has decided to aim its marketing efforts and ultimately its merchandise. A well-defined target market is the first element to a marketing strategy...

  • Product management
    Product management
    Product management is an organizational lifecycle function within a company dealing with the planning, forecasting, or marketing of a product or products at all stages of the product lifecycle....

  • Market segment
    Market segment
    Market segmentation is a concept in economics and marketing. A market segment is a sub-set of a market made up of people or organizations with one or more characteristics that cause them to demand similar product and/or services based on qualities of those products such as price or function...

  • Product differentiation
    Product differentiation
    In economics and marketing, product differentiation is the process of distinguishing a product or offering from others, to make it more attractive to a particular target market. This involves differentiating it from competitors' products as well as a firm's own product offerings...

  • Proximity mapping
    Proximity mapping
    In marketing and business strategy, proximity mapping is a technique used by IBM, McKinsey and other corporations to illustrate the relative closeness of market segments or characteristics in a two-dimensional space -- typically a sheet of paper or a presentation slide.-Adjacent Markets:Here, for...

  • Marketing plan
    Marketing plan
    A marketing plan may be part of an overall business plan.Solid marketing strategy is the foundation of a well-written marketing plan. While a marketing plan contains a list of actions, a marketing plan without a sound strategic foundation is of little use....

  • Sustainable competitive advantage
    Sustainable competitive advantage
    Competitive advantage is defined as the strategic advantage one business entity has over its rival entities within its competitive industry. Achieving competitive advantage strengthens and positions a business better within the business environment....

  • Strategic management
    Strategic management
    Strategic management is a field that deals with the major intended and emergent initiatives taken by general managers on behalf of owners, involving utilization of resources, to enhance the performance of firms in their external environments...

  • Marketing strategies
  • Placebo (origins of technical term)
  • Points-of-parity/points-of-difference
    Points-of-parity/points-of-difference
    -Points of difference and points of parity:These can be utilized in the positioning of a brand for competitive advantage via brand/product.In essence:...

  • The 22 Immutable Laws of Marketing
  • List of renamed products
The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
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