What is positioning?
Positioning (or product positioning) is how the product is designed to be perceived in the marketplace by the target market against its main competitors. In other words, it’s basically how consumers understand the product offering and how it differs from similar competitive offerings.
Positioning is built by the organization designing and promoting their product by highlighting various product features, benefits, and/or other competitive advantages. Ideally, firms like to create a clear and distinct product positioning. If they can achieve this positioning goal, then their product becomes the ‘product of choice’ for certain target markets or consumer needs.
Positioning is the final main phase of the overall STP process (which stands for segmentation, targeting and positioning). Positioning is typically more important in cluttered and competitive markets, particularly for low-involvement purchase decisions.
Definition of positioning
Positioning was ‘popularized’ by Trout and Ries in the 1980s. The two authors are still considered experts in the areas of positioning and branding. The following quote was sourced from Ries’ Pieces, a related website, which specializes in branding issues. The website quotes the following positioning definition from Al Ries himself:
- “Positioning is not what you do to the product; it’s what you do to the mind of the prospect. It’s how you differentiate your brand in the mind. Positioning compensates for our over-communicated society by using an oversimplified message to cut through the clutter and get into the mind. Positioning focuses on the perceptions of the prospect not on the reality of the brand.”
As you can see, this view of positioning is strongly related to image and communication and its impact on consumer perception. However, it is important to recognize that a clear market positioning is achieved through combined effort of the entire marketing mix, not just via promotional activities. This is because it is difficult (in the long-term) to convince consumers of the quality, unique features and benefits, and competitive advantages of a product, unless the communication claim has some substance to it.
Other than that clarification, please note the essence of the definition from Ries: that positioning is a battle for the mind of the consumer. Let’s now look at another definition of positioning as a point of comparison.
- “Positioning can be defined as how a product or a company’s offer appears in the mind of the target customer with respect to other brands in the market. Positioning is critical to brand building because it is responsible for projecting the brand identity and creating the perception and image of the brand in people’s mind.” (Vashisht, 2005)
Note the important similarities of these two positioning definitions: that positioning is in the mind of the target market and that the consumers’ understanding of the product is on a relative or differentiated basis (that is, some comparison to competitors.) Therefore, we can summarize the definition of positioning as being:
- Positioning is the target market’s perception of the product’s key benefits and features, relative to the offerings of competitive products.
The important aspects of this definition are:
- Positioning is the perception (their knowledge and understanding) of consumers,
- The focus is on the perceptions of the target market,
- Only the key features/benefits can be effectively communicated, and
- Perception, relative to competing products, is very important.
Positioning and the STP process
Positioning is the third and final major phase of the overall STP (segmentation, targeting and positioning) process. By this stage of the process, the firm would have a good understanding of the overall marketplace and have a sense of what positioning goals would work in this market. (This understanding would have been primarily achieved through the segmentation process and the evaluation and selection of one or more target markets.)
Also, as part of the target market selection phase, the organization would have considered the competitiveness of the various segments and thus would be aware of the competitive offers and their behavior. On the basis of this information, in conjunction with the firm’s strategy and competitive strengths, various positioning options would probably have been considered already.
As a recap, the basic model for the STP process is shown below: