The concept of Positioning has been around since the 80s. And before that, companies relied first on their product/service and then on the attached image of it. Later, with new developments and crowding up of markets, consumers became confused about what to buy and whatnot. Even worse, marketers didn’t know how to establish their differentiation among so many competitors flooding the market. That’s when Ries and Trout came up with the concept of positioning, which allowed markets to create a powerful position in the minds of the prospects. Needless to say, positioning is very relevant even today and has proved to be a game-changer for many product/service companies.
So, what exactly is positioning?
Plainly put, positioning is the ability of the marketer to influence a consumer’s perception of the product/service being sold. Positioning is a way of creating a certain identity of the product/service in a consumer’s mind. For example, a premium car manufacturer may position the vehicle as a luxury status symbol. A laptop manufacturer may position it as an innovative and top-notch technology.
“You can’t be everything to everyone, but you can be something great for someone.” – Matt Cheuvront, CEO – Proof Branding
Here are some common positioning strategies widely adopted across the globe:
- Features and benefits: Associating products/services with its characteristics and the benefits of using them
- Price: Associating products/services with competitive pricing
- Quality: Associating products/services with superior quality
- Utility: Associating products/services with different uses and applications
- Competition: Informing consumers how products/services are better than that of the competitors
Detail out the Problem you’re solving
At the core, positioning is all about communicating the value of your product/service in the most articulate way. Christopher Escher, the former Head of Marketing & Communications at Google explains a formula for marketers to apply to get their positioning right. It goes as follows:
For (target customer) Who (statement of need or opportunity), (Product name) is a (product category) That (statement of key benefit). Unlike (competing alternative) (Product name)(statement of primary differentiation).
Using this formula often needs a few revisions until you nail it and can be confident about approving it. Amazon’s happens to have hit the bulls-eye and goes as follows:
For World Wide Web users Who enjoy books, Amazon is a retail bookseller That provides instant access to over 1.1 million books. Unlike traditional book retailers, Amazon provides a combination of extraordinary convenience, low prices and comprehensive selection.
The goal of such a statement is to make your external customers (Consumers) and your internal customers (employees) well-aware of the key components of the product/service and convince them about how special it is.
Understand the market you’re entering
Steven Blank is a seasoned entrepreneur and venture capitalist from Silicon Valley who has also write many insightful books for entrepreneurs and marketers. One of the fabulous books is about positioning called, The Four Steps to the Epiphany: Successful Strategies for Products that Win. In the book, Blank bluntly highlights that most startups spend too much time on building the product and then force-fitting it into the market. Many startups have failed because of adopting this kind of strategy. Instead, a more successful way is to first identify the market needs in detail, and then prune the product accordingly. For this, he suggests two simple steps for ensuring the right positioning for a product/service.
- Determine which is your market type:
- A new product/service in an existing market
- A new product/service in a new market
- A new product attempting to resegment an existing marketing via low cost
- A new product attempting to resegment an existing market by creating a niche
- Understand the specific positioning strategy for your market type
- For new product/service in an existing market – focus on differentiating yourself from the competitors
- For new product/service in a new market – focus on the problem that you’re solving and inform your consumers well
- For new product attempting to resegment an existing marketing via low cost – Eliminate competition by offering your product/service at a low price
- For new product attempting to resegment an existing market by creating a niche – focus on how your product is better than the specific elements of the incumbent’s product
Once your position is rolled put in the market is equally important to take a stock of the consumers reaction to the positioning. Understanding the consumer’s perception about your offering can bring in several valuable insights for your marketing as well and product development team to work further on. But, consumers come in all shapes and sizes. Therefore, it is necessary to first shortlist your customers from different segments, and different personas. Then, take and in-depth feedback from each segment and persona. You can assign this task to your Customer Advisory Boarch (CAB), since it needs constant and dedicated research. Compile your customers’ responses to questions like:
- How do you know about us?
- Which problem do you think our product/service is solving for you?
- Do you think there is a better solution than the one we’re offering?
- If our product/service was not available, which other product/service would replace us?
Through these questions, you will know what your customers value the most and the least about your product/service. This in turn will help you create a more powerful positioning.