Product positioning is an important strategy for achieving differential advantage. Positioning reflects the "place" a product occupies in a market or segment. A successful position has characteristics that are both differentiating and important to consumers. Every product has some sort of position — whether intended or not. Positions are based upon consumer perceptions, which may or may not reflect reality. A position is effectively built by communicating a consistent message to consumers about the product and where it fits into the market — through advertising, brand name, and packaging.
Positioning is inextricably linked with market segmentation. You can’t define a good position until you have divided the market into unique segments and selected your target segments. Three key research issues must be addressed: |
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What does the "space" look like — what are the most important dimensions in the category? | |
What are the other products in that space and where are they? | |
What are the gaps, unfilled positions or "holes" in the category? | |
Which dimensions are most important? | |
How do these attitudes differ by market segment? |
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Some of the positioning opportunities for a product include: |
Finding an unmet consumer need — or at least one that’s not being adequately met now by competition | |
Identifying a product strength that is both unique & important | |
Determining how to correct a product weakness and thereby enhance a product’s appeal. (e.g., legitimate "new & improved") | |
Changing consumer usage patterns to include different or additional uses for the product | |
Identifying market segments, which represent the best targets for a product |
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Creating a new positioning can come from two sources: |
Physical product differences | |
Communications — finding a memorable and meaningful way to describe the product (e.g., calling 7-Up the "Uncola"). As Ries and Trout point out, "Positioning is not what you do to a product; positioning is what you do to the mind of the prospect." |
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