Examples of Repositioning
Here are three different examples of how and why products are repositioned. These are examples that are important to understand your marketing course, as discussed elsewhere, there are a number of viable alternatives to deciding to reposition product.
Mother Energy Drink (Coca-Cola)
The first example relates to Mother Energy Drinks, which was launched into the Australian market in 2006 by the Coca-Cola Company.
Coca-Cola used a heavy launch program to generate trials of the product. In particular, they had a series of TV commercials that have a look and feel similar to the Madagascar movie that was popular at the time. They leveraged their extensive distribution channels and were able to get the product in many retailers, with prominent point-of-sale displays. The can’s packaging had a tattoo look about it, again tapping into the popular culture of the time.
While the launch campaign was professionally and effectively executed, the taste of the product was not great and repeat purchases were quite low as a consequence.
Obviously, Coca-Cola is a major firm in beverage, so a poorly performing product is simply not suitable for them. Therefore, they had to decide whether to improve and reposition the product or to withdraw it and replace it with a new brand and product. The firm decided to reposition the product. This is because they had done such a good job with the launch, that the brand awareness (a key part of brand equity) was very high in the marketplace.
With the relaunch and repositioning project, their biggest challenge was to convince consumers to re-trial the product. As a result, they changed the packaging, increased the size of the can and, of course, improved the product’s taste.
However, they approached the problem of the product’s perceived poor taste head-on. For instance, on the can’s packaging, in quite prominent letters, they had “New Mother, tastes nothing like the old one". Their TV commercials for the relaunch (see below), which used a humor appeal, showed commandos breaking into the lab to get the scientists that invented the original formula.
As a consequence, they are able to reposition the product as having a great taste and many consumers were willing to re- trial the product and today the product enjoys a good share of the Australian market and is performing to the firm’s expectations.
Napisan is a laundry detergent product that was designed to wash baby diapers (called nappies in Australia, hence the name of the product). Napisan was a very popular product up until around the 1980s when there was a significant change in consumer lifestyles. As consumers became more time poor, as a consequence of both parents working, there was a big shift from using washable cloth diapers to using disposable ones.
Therefore, sales of the NapiSan product fell in line with the decrease in consumer demand. This is a good example of repositioning being required due to the change in the macro environment.
The firm had a good quality product, so they had to decide whether to reposition the product or to bring out the same product under a new brand name. They decided to reposition it because it had good brand equity (high awareness and it was trusted by consumers).
Over recent years the NapiSan product has been successfully repositioned for a new use; being the ideal laundry detergent for tough stains.
Repositioning a Credit Union
The final example demonstrates how a credit union was repositioned because it did not have a clear positioning space. As shown in the perceptual map (below), the credit union was competing in a local market with a local bank which was substantially bigger than itself. Both were best perceived as local and conservative, but the much larger financial institution was generating more market share.
As you can see, there was a clear market gap in the bottom right-hand quadrant and the credit union decided to reposition itself into that space. This move allowed them to keep the positioning aspect of being local, but required them to modify their positioning from being conservative to being more innovative.
As part of this repositioning process, the credit union introduced a range of new products, set up a customer relationship management (CRM) program, modified their sales and customer service staffing structure, and changed their tagline to “leading the way".
These marketing mix changes were able to clearly communicate their new positioning and the credit union grew by 60% over the next three years.