Product Positioning

Effective product positioning is a key ingredient of successful marketing today. This article discusses the importance of positioning as it relates to the segmentation process and discusses several approaches to the process.

The Interrelationship of market Segmentation and Product Positioning:

Segmentation is essentially the accommodation of different consumer groupings in a marketing plan or strategy. Knowing that different consumers respond differently to products, promotions, prices, and channels mean that the marketer should not consider just the overall population’s reaction to, say a product, but also the reaction among different market segments. Market segmentation, therefore, is both the process of defining the characteristics of various segments in the marketplace and the allocation of marketing resources among these segments. Product positioning is closely linked with market segmentation. A product’s position is the place that it occupies relative to competitors in a given market as perceived by the relevant group of customers, that is, by the target market segment. Positioning involves determining how consumers perceive the marketer’s product ad also developing and implementing marketing strategies to achieve the desired position in the market. Product, price, distribution, and promotional ingredients should all be viewed as potential tools for positioning a company and its offering. Positioning therefore, has no value in itself, only in its effect on the target market segment. Marketers must look at segmentation and positioning in tandem. The process may start either by selecting a target market segment and then trying to develop a suitable position, or by selecting an attractive product position and then identifying an appropriate market segment. Whether the product is new or old, positioning is a key ingredient for achieving successful market results.

Although business people have long been positioning their products to appeal to target market segments, these decisions have not always been made consciously or successfully. To increase the chances of success, a systematic approach to the decision is needed.

Strategies to Position Products:

Many ways exist for positioning a product or service (or even an organization). The following illustrate some of these approaches. It should be noted that combinations of these approaches are also possible.

Position on Product Features: The product may be positioned on the basis of product features. For example an advertisement may attempt to position the product by reference to its specific features. Although this may be a successful way to indicate product superiority, consumers are generally more interested in what such features mean to them, that is, how they can benefit by the product.

Position on Benefits: This approach is closely related to the previous method. Toothpaste advertising often features the benefit approach, as the examples of Crest (decay prevention). Close up (sex appeal through white teeth and fresh breath) and Aqua fresh (a combination of these benefits) illustrates. The difference between this and the features approach is illustrated by the edge. Don’t sell the steak sell the sizzle.

Position on usage: This technique in related to benefit positioning. Many products are sold on the basis of their consumer usage situation. Companies have sometimes sought to broaden their brand’s association with a particular usage or situation. Campbell’s Soup for many years was positioned for use at lunchtime and advertised extensively over noontime radio. It now stresses a variety of users for soup (recipes are on labels) and a broader time for consumption, with the more general theme. Soup is good food. Gatorade was originally a summer beverage for athletes who needed to replace body fluids, but it has also tried to develop a positioning strategy during the cold or flu season as the beverage to drink when the doctor recommends consuming plenty of fluids. Arm & Hammer very successfully added a position to its baking soda – as an odor destroying agent in refrigerators and sales jumped tremendously.