Why Positioning is Used

Why is positioning important?

There are many reasons why positioning is very important to firms, as outlined in the following table:

Role of Positioning

How positioning can be used

Support overall strategy

Creating a clear positioning for a brand/product in the marketplace is often an integral part of an organization’s overall marketing strategy. (For example, some firms have a strategy of building strong brands and product positioning helps achieve that  result.)

Differentiate offerings

Clear positioning helps the consumer differentiate between competitive offerings (as well as between similar offerings from the same brand). As we know, part of the key to marketing success is the ability to differentiate on some important features/benefits to the target consumer.

Competitive position

Having a number of clearly positioned products/brands increases the competitive strength of the organization in the marketplace. Their brand equity is stronger and they ‘own’ more market space.

Increase sales and customer loyalty

Brands/products that are well understood by consumers will typically generate higher sales levels, as they are seen as the ideal product solution for particular consumer needs. As a result, these customers become less likely to switch to competitive offerings.

Avoid cannibalization

Positioning allows the firm to place more products in a related category, with a reduced risk of cannibalization. This is because consumers will perceive the difference between the firm’s similar offerings, rather than viewing them generically.

Clear communication and consistency

With clear positioning goals the firm can ensure that its IMC mix remains consistent, as opposed to the possibility of focusing on different benefits and offers with various campaigns over time.

Reduce price sensitivity

If a product/brand is clearly positioned as having distinct advantages over its competition, then consumers will see greater value and will become less sensitive to prices and competitive sales promotions.

Good for low-involvement purchases

Positioning is a great assistance when marketing low-involvement products. For the purchase of low involvement products, consumers often rely on their memory to make a quick or impulse purchase decision. By being well, consumers become more likely to select the firm’s brand/product.

Good for habitual purchases

Many supermarket style products (that is, FMCGs – fast moving consumer goods) are bought on a habitual basis. If a product is well positioned on key attributes/benefits, then the consumer can internally rationalize why they buy the same product on a regular basis without consideration of the competitive offerings.

Facilitate W-O-M

For products that are more prone to word-of-mouth (W-O-M) communication, being positioned around a few key benefits/features makes it much easier for the target market to communicate the advantages of the product to other consumers

Guide marketing mix development

Positioning needs to be implemented by the full range of the marketing mix, so a firm that outlines clear positioning intentions will be more likely to implement marketing mix that is consistent and supports its positioning goals.