A marketing strategy that aims to make a brand occupy a distinct position, relative to competing brands, in the mind of the customer. Companies apply this strategy either by emphasizing the distinguishing features of their brand (what it is, what it does and how, etc.) or they may try to create a suitable image (inexpensive or premium, utilitarian or luxurious, entry-level or high-end, etc.) through advertising. Once a brand is positioned, it is very difficult to reposition it without destroying its credibility. Also called product positioning.
Positioning is defined as the act of designing the company’s offering and image to occupy distinctive place in the target market’s mind. A simple example of positioning would be If I say An expensive TV, what comes first to your mind probably will be A Sony or A Samsung TV whereas if i say a cheaper or VFM TV (value for money TV) you might think of an Onida or a Videocon.
The main points that you should remember are:
- Positioning is the final part of the SEGMENT – TARGET – POSTION or STP process
- Positioning is undoubtedly one of the simplest and most useful tools to marketers.
- Positioning is all about ‘perception’. As perception differs from person to person, so do the results of the positioning map e.g. what one perceive’s as quality, value for money in terms of worth, etc, will be different to any other person’s perception. However, there will be similarities in certain cases.
- After segmenting a market and then targeting a consumer, next step will be to position a product within that market. It refers to a place that the product offering occupies in consumers’ minds on important attributes, relative to competing offerings. How new and current items in the product mix are perceived, in the minds of the consumer, therefore re-emphasizing the importance of perception!! New Product-need to communicate benefits.
Importance of Positioning
- To Make Entire Organization Market-oriented
Product positioning is a part of the broader marketing philosophy. It concerns with identifying superior aspects of product and matching them with consumers more effectively than competitions. This philosophy makes the entire organization market oriented.
- To Cope with Market Changes
Once the product is positioned successfully doesn’t mean the task of manager is over. He has to constantly watch the market. As per new developments in the market place, new competitive advantages should be identified, discovered or developed to suit the changing expectations of the market. It makes the manager active, alert and dynamic.
- To Meet Expectation of Buyers
Generally, the advantages to be communicated are decided on the basis of expectations of the target buyers. So, product positioning can help realize consumers’ expectations.
- To Promote Consumer Goodwill and Loyalty
Systematic product positioning reinforces the company’s name, its product and brand. It popularizes the brand. The company can create goodwill and can win customer loyalty.
- To Design Promotional Strategy
More meaningful promotional programme can be designed. Based on what advantages are to be communicated, appropriate means are selected to promote the product.
- To Win Attention and Interest of Consumers
Product positioning signifies those advantages that are significant to consumers. When such benefits are promoted through suitable means of advertising, it definitely catches the interest and attention of consumers.
- To Attract Different Types of Consumers
Consumers differ in terms of their expectations from the product. Some want durability; some want unique features; some want novelty; some wants safety; some want low price; and so on. A company, by promoting different types of competitive advantages, can attract different types of buyers.
- To Face Competition
This is the fundamental use of product positioning. Company can respond strongly to the competitors. It can improve its competitive strength.
- To Introduce New Product Successfully
Product positioning can assist a company in introducing a new product in the market. It can position new and superior advantages of the product and can penetrate the market easily.
- To Communicate New and Varied Feature Added Later on
When a company changes qualities and/or features of the existing products, such improvements can be positioned against products offered by the competitors. Product positioning improves competitive strength of a company. Normally, consumers consider product advantages before they buy it. So, product positioning proves superiority of company’s offers over competitors. It may also help consumers in choosing the right product.