Positioning is the physical and perceived qualities of your product or service. Your positioning depends on how you adapt the marketing toolbox or the ‘sacred’ 4P’s* of marketing according to which segment you are targeting. Got it?
This is the third part of the trio that started with segmentation and targeting.
Each element of the 4P’s need to be carefully developed. Decisions for each dimension will flow from your discovery during the segmentation process and from the decisions you make during targeting, be in line with your overall branding values and your company strategy.
So, for example, you may have a dilemma to target between the largest but slowest growth market or the smallest but fastest growing market. How to choose? If I’m aiming for the low volume/high margin business, I’m likely to focus on prestige, quality, performance and durability at a premium.
Comparison of the 4P’s situations and example strategies for a Premium and Value product/service:
| Dimension | Prestige segment | Value segment |
| Strategy | Differentiation | Market penetration |
| Market size | Small | Large |
| Market growth | Strong | Modest |
| Margin | High | Low |
| Market saturation | Low (few competitors) | High (lots of competitors) |
| Brand perception | Exclusive, prestigious | Good value |
| Critical Success factor | Prestige, quality, service | Price, basic performance |
| Product | Perceived quality, prestige, performance, durability, value-added services, consulting | Core/basic needs met, no frills, product is pared down to a minimum to serve its function |
| Price | Premium pricing range, less elastic to price differences/changes | Value pricing, competitive, |
| Place | Specialist distributors or partners that can provide a high level of service, advice, guidance, training | Mass distribution, easy to buy, no guidance needed |
| Promotion | 2 goals:
Increase awareness and customer loyalty by levering emailing, social networking, face time, TV, SEO, encourage sponsoring, WOM (word of mouth) , selected press and websites, Press releases |
Focus of price and availability. May need substantial expenses to differentiate from competitors, SEO, TV, general press, banner ,buy 2 get a third free |
Product decisions will be based in those product characteristics that are meaningful and discernable to the target audience. The decisions can be physical (eg. Colour, size, weight, shape, performance) and abstract (brand values, prestige).
Pricing decisions depend on the consideration you provide for the amount paid.
The most important element to remember is to avoid ‘following the crowd’ and to create a USP (unique selling point) that reflects your brand, your image (or the image you want to project).
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