Positioning for Competitive Advantage

The final step in target marketing involves market positioning. Once the company has decided on segments to enter, it must decide what “position” it wants to occupy in those segments.

A product’s position is the way the product is defined by consumers on important attributes—the place the product occupies in consumer’s minds relative to competing products.

Because consumers cannot reevaluate products every time they make a buying decision, they “position” products, services, and companies in their minds.

1). Consumers position products with or without the help of marketers.

2). Marketers do not want to leave their products’ positions to chance.

3). They plan positions that will give their products the greatest advantage in selected target markets, and design marketing mixes to create those planned positions.

Choosing a Positioning Strategy

The positioning task consists of three steps:

Step 2. Choosing the Right Competitive Advantage

1). The first step is identifying a set of possible competitive advantages upon which to build a position.

a). The key to winning and keeping customers is to understand their needs and buying processes better than competitors do and to deliver more value.

b). A competitive advantage is an advantage over competitors gained by offering consumers greater value, either through lower prices or by providing more benefits that justify competitive advantage.

c). Not every company will find many opportunities for differentiating its product offering and gaining competitive advantage.

d). Most companies do not hope to gain a permanent advantage, only a temporary one.

e). Specific ways that a company can differentiate its offer from those of the competition are:

1]. Product differentiation involves differentiating a company’s physical product. Methods include variety of standard or optional features, performance, style and design, or attributes (such as consistency, durability, reliability, or repairability).

2]. Services differentiation is the way the firm differentiates the services

that accompany the product. Methods include:

a]. Speedy, reliable, or careful delivery.

b]. Installation service.

c]. Customer training service.

3]. Channel differentiation gains competitive advantage through the way

the company designs its channel coverage, expertise, and

performance.

4]. People differentiation involves hiring and training better people than

the competitors do.

5]. Image differentiation requires working to establish images that

differentiate them from competitors. Symbols can be used.

2). The second step is choosing the right competitive advantage. In so doing, the organization must decide on the following:

a). How many differences to promote? Many marketers think that companies should aggressively promote only one benefit to the target market.

1]. Ad man Rosser Reeves called this benefit the Unique Selling Proposition (USP).

2]. Go for the number one attribute.

b). Others believe that more than one differentiating factor is fine. However, avoid:

1]. Underpositioning —failing to ever really position the company at all.

2]. Overpositioning —giving buyers too narrow a picture of the company.

3]. Confused positioning —leaving buyers with a confused image of a company.

c). Which differences to promote? Not all differences are meaningful or worthwhile. A difference is worth establishing if it satisfies the following criteria:

1]. Important.

2]. Distinctive.

3]. Superior.

4]. Communicable.

5]. Preemptive.

6]. Affordable.

7]. Profitable.

3). The final step is selecting an overall positioning strategy. Once

a position is chosen, the company must take strong steps to deliver and

communicate the desired position to target consumers.

a). The company must select an overall positioning strategy.

1]. Consumers typically choose products and services that give them the

greatest value.

2]. The full positioning of a brand is called the brand’s value proposition

(the full mix of benefits upon which the brand is positioned).

3]. Typical brand propositions can include:

a]. More for more.

b]. More for the same.

c]. The same for less.

d]. Less for much less.

e]. More for less.

Communicating and Delivering the Chosen Position

Once a position is chosen, the company must take strong steps to deliver and communicate the desired position to target consumers.

1). All the company’s marketing mix efforts must support the positioning strategy.

2). Positioning calls for concrete action, not just talk.

3). Companies often find it easier to come up with a good positioning strategy than to implement it.

4). The positioning strategy must be monitored and adapted over time to match changes in consumer needs and competitor’s strategies.

5). Abrupt changes that might confuse consumers need to be avoided.

6). A product’s position should evolve gradually as it adapts to the ever-changing environment.

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