Imagine you’re browsing through a crowded marketplace, surrounded by various products vying for your attention.
Suddenly, your eyes land on a particular item that instantly captures your interest.
It stands out from the rest, appealing to your unique needs and desires.
Have you ever wondered how some products effortlessly position themselves in the minds of consumers?
In this article, we will embark on a journey to unravel the secrets of effective product positioning.
Through ten carefully crafted steps, you will learn how to create a compelling product positioning strategy that sets your offering apart, resonates with your target audience, and ultimately leads to success in the competitive marketplace.
Get ready to discover the art of strategic positioning and unlock the path to capturing the hearts and minds of your customers.
We’ll be covering the following topics (click on a bullet point to jump to that section):
What is Positioning in Marketing?
Positioning in marketing is the process of identifying a target market/audience and creating an image of your product that fills the target market’s unfilled need.
Positioning is the other half of a brand along with a brand image.
I discuss how a “brand” equals both a positioning strategy and a brand image strategy.
A product positioning strategy can be better understood with the analogy of a lock and key.
In this case, the lock would be the target market/audience with the unfilled need and the key would be the image of the product you are trying to position as the solution to their unfilled need.
10 Steps for a Product Positioning Strategy
What are the steps in positioning? Let’s dive into 10 steps and positioning tools that will allow you to implement a successful product/service positioning strategy.
1. Understand the Market & Target Audience
The first step is to understand the market and target audience.
This is important because you need to identify what the “lock” is so you can provide a key for it.
This step will also allow you to understand who the direct and indirect competitors are.
2. Understand Mission
The second step is to understand the company’s mission.
If you don’t know your mission statement as a company, how can you expect your target audience to know?
For personal brands, this is similar to personal brand statements.
Each product or service a company is trying to position should fall within its mission and should align with it.
Using a simple example, if I own a vegan restaurant and our mission statement is to “Provide the best meatless hamburgers to inspire more users to go vegan,” then as a product, I wouldn’t start introducing Double Cheeseburgers with real meat on the menu. It doesn’t align.
The third step to successfully positioning a product is the name.
An example of a company such as Apple, which has a strong corporate image, names all its products with “i” before it to align its new products with the existing corporate identity/image that Apple carries.
Such examples include the iPod, iPhone, etc.
Another example is a fish called the Patagonian toothfish. In 1977, they started calling this fish the “Chilean Sea Bass” in restaurants to make it more attractive to seafood consumers.
The name should align with the mission statement, actual product, price, target audience, brand, and other components discussed in the Marketing Framework.
The fourth step to successfully positioning a product is to determine the logo.
Just like the name, the logo should align with the brand to help position it in the minds of the target audience.
For example, AT&T’s logo of the globe.
It was created to show that they have a “global presence” and position their products in that same way.
The slogan is also important.
Slogans should be memorable, include a key benefit, and help differentiate the brand providing that “uniqueness” that was mentioned earlier.
Difference Between Slogan and Tagline
The difference between a slogan and a tagline is that a slogan should encompass what it stands for or even encompass the company’s mission. Slogans are often generally longer.
Taglines are usually catchy quips that can enable people to make an association with the brand/business in a lighthearted manner.
Companies don’t need both slogans and taglines and oftentimes companies just have a tagline without a slogan or vice versa.
The choice is yours.
An example is Dollar Shave Club. They provide razors and other grooming products to customers by mail. Their tagline is, “Shave Time. Shave Money.”
Another example is MasterCard, the financial services corporation most known for its credit card. Their slogan is, “There are some things money can’t buy. For everything else, there’s MasterCard.”
Color is an important positioning tool and is often related to color theory and the psychology behind colors.
Reds can capture attention and are often associated with excitement, passion, danger, or energy.
Orange represents creativity, adventure, and enthusiasm.
Yellow represents happiness, optimism, and positivity.
Pink often represents love, playfulness, and femininity.
Green represents growth, health, fertility, and nature.
Blue represents harmony, peace, and calm.
Purple represents royalty, nobility, luxury, and wisdom.
White represents innocence, cleanliness, and goodness.
Black represents mystery, power, and sophistication.
Grey represents neutrality and balance.
Brown represents comfort, earth, and security.
It has even been found that red and yellow combined make you hungry.
Have you ever noticed how all the top fast-food chains are red and yellow such as McDonald’s In’n’out, or Pizza Hut?
Coincidence? I think not.
The typography that is used also plays a factor in the positioning and brand of a product.
Typography can convey meaning, set a mood, and even change perceptions.
Font size, font style, font spacing — they all play a part.
If your company has a mascot, the mascot type plays an important role as well.
Think Tony the Tiger, Mickey Mouse, or the Pillsbury Doughboy. They all align with the product and brand messaging to help better position their products.
For example, the Pillsbury Doughboy aligns with the position of Pillsbury’s cookie products.
Imagine if the Pillsbury Doughboy was instead a hard-chiseled, muscular rock? It wouldn’t align with the positioning.
9. Product Shape
The product shape is also important to the positioning of the product.
An example of this can be seen with Absolut Vodka and its bottle shape.
They wanted to promise an entirely new experience in their positioning strategy, and their bottle design was one component of their positioning strategy.
For those who see the bottle now without the logo, they would instantly recognize it’s Absolut.
If the company is going to have a jingle, then it must also align with the positioning of the product and brand image.
Jingles can be a very important part because if successfully implemented, then every time someone hears a jingle or looks at the logo, they can hear the jingle in their head.
For example, one of the most popular jingles is McDonald’s “I’m Lovin’ It” jingle.
I’m sure just reading those words on the screen, you can hear the jingle in your head.
The jingle you choose should align with the product positioning strategy and it can be a great positioning tool to add and solidify your position with the market and what your company stands for.
What is Repositioning in Marketing?
Repositioning involves changing your target market/audience’s perception of your product or service.
This is important because it’s a chance to show off your “uniqueness” and how it compares to direct and indirect competitors’ products.
Reasons to reposition include a product performing poorly or because there has been a shift in the tastes of the target market.
Either way, it’s important to know how to effectively reposition your product.
How to Reposition?
In order to complete a successful repositioning strategy, you need:
- Solid marketing plan using the components of the Marketing Framework
- A Promotion Strategy Plan
- Use of 3rd-Party proof
- If you are making a claim that your product can do something that the competition can’t, you need proof to back it up.
- An example can be seen when Tylenol took the #1 spot from Bayer by publishing an article in the New England Journal of Medicine that detailed the negative side effects of Aspirin.
- If you are making a claim that your product can do something that the competition can’t, you need proof to back it up.
- The product itself actually needs to be of high quality and better than the competitors
- Great customer service
If all these components are in-play, then a repositioning strategy can be effectively pulled off and David can beat Goliath.
What Influences Positioning?
There are many components within the Marketing Framework that influence a product position that is important to understand.
Such components are pricing strategy, promotion strategy, the actual product/service, and distribution.
It’s important to understand these components to see how they all work in unison like cogs in a wheel.
Why is Positioning in Marketing Important?
Having a product positioning strategy is important because it allows you to have a focused and targeted approach.
“If you fail to plan, you’re planning to fail” – Benjamin Franklin
Benefits of a Product Positioning Strategy
Benefits of a strong product positioning strategy include competitor lockout and top-of-mind choice in your target audience/market’s mind.
1. Positioning as a Competitive Weapon
Positioning in marketing is also important because you can use your product positioning as a competitive weapon.
If a product positioning strategy is successfully implemented, then your target audience will have an image of the product that is memorable.
When this happens, the benefits of the product will be in the mind of your target audience making it hard to copy by competitors, and you can lock out the competition.
2. Positioning to Create Uniqueness
Positioning can also be used to create uniqueness.
The goal is to show your target audience/market that you provide all of the benefits of your competition plus something else unique.
In my Marketing Framework Guide (mainly for photographers but applies to everyone), I give the example of a Kangaroo’s pouch.
Let’s say the Kangaroo’s pouch is its most unique/distinguishing feature (which it is for the most part)
Hypothetically, let’s also say all the other Kangaroos in the world didn’t have pouches but yours did.
You can “sell” the Kangaroo by focusing on the pouch and the capability of the pouch — essentially saying “Hey I have a Kangaroo just like the rest of them, plus mine also has the capabilities and benefits of this pouch.”
When planning a product positioning strategy, think about what the product’s unique benefit is, and what the “plus” is.
Let’s dive into some examples.
1. Toothpaste Market
Let’s look at the toothpaste market as an example.
Within the market, there are companies such as Arm & Hammer, Crest, Colgate, and Aquafresh.
These are all toothpaste products, yet each position themselves having a unique benefit for different target audiences.
They all clean your teeth, right? Some just offer “extras” on top of cleaning your teeth.
For example, Crest’s toothpaste promotes fighting cavities with fluoride, Colgate’s toothpaste promotes being the total solution, and Aquafresh’s toothpaste promotes providing fresh breath and clean teeth for when you are in those close, intimate situations such as a date.
2. Automobile Market
Using the example of the car brand, Honda, they have positioned their different cars based on different socio-economic target audiences.
Honda has the Honda Accord and Honda Civic as its more middle-class option, and Honda positions its Honda Acura cars as the more upper-class option.
They’re all still cars at the end of the day, but some offer more “bells and whistles” to market to different target audiences.
Providing those “keys” for different “locks.”
How to Position a New Product Within the Market?
When offering or introducing a new product to the market, it can be tricky to figure out how to position it since there are no current direct competitors.
The best way to position a new product within the market is to position it in terms of the old.
For example, when automobiles were introduced, they were called “Horseless Carriages,” positioning them in terms of the old way of transportation.
Using this same example, the movement was also called “Horsepower” so people could understand it better since it was a new product within the market.
Types of Competitors to Be Aware Of
When it comes to positioning a product successfully, it’s important to know who and what the competition is.
There are three main types of competitors to be aware of.
The first two are external competitors and the last is an internal competitor.
1. External Competitors
The external competitors include direct and indirect competitors.
Direct competitors are competitors that offer products that can fit the same “lock” as your products.
Examples of direct competitors are the Toyota Camry and the Honda Accord.
Another example is the McDonald’s Big Mac versus Burger King’s Whopper.
Indirect competitors can be the most difficult to compete against because indirect competition includes substitutes or the target market keeping their money and doing nothing.
Examples of this include owning a burger restaurant, the indirect competition would be a substitute of the target market grabbing take-out sushi instead of going to your restaurant or picking up a frozen pizza from the market and cooking it themselves.
These products compete indirectly with one another but they are all indirect competition because they are offering “keys” to fit the “lock” which in this case would be hunger.
2. Internal Competitor
The internal competitor is yourself.
This competitor can often be forgotten but it’s important to know in order to have a successful position within the market.
An example of this can be described as “product cannibalization.”
This is when one of your products competes with another. So rather than an external competitor taking business away from you, you’re taking business away from yourself.
You may be thinking, “Well the company is still making money because the products are from the same company at the end of the day.”
In our Brand Image guide, I mention how the brain is hardwired to prefer simple, easy choices.
This product cannibalization can lead to confusion amongst buyers because it’s targeting many of the same customers. When there is confusion, users may choose to go with direct and indirect competitors.
An example of this can be seen with Coca-Cola with their products of Coke Zero, Cherry Coke, and Vanilla Coke which target many of the same customers.
Due to this, they end up taking sales and market share away from each other.
Ensure each product provides a key for a lock. If you have two keys for one lock, buyers can get confused each time about which key works for the lock.
- Market Research Tools
- Competitive Analysis Tools
- Customer Feedback Tools
- Analytics Tools
- Social Media Monitoring Tools
- Identify Your Target Audience: Begin by clearly defining your target audience. Conduct market research to understand their needs, preferences, and pain points. Consider demographic factors, psychographics, and behavioral patterns to create detailed buyer personas.
- Analyze Competitors: Thoroughly analyze your competitors to identify gaps and opportunities for differentiation. Assess their product offerings, positioning strategies, strengths, and weaknesses. This analysis will help you determine how to position your product uniquely in the market.
- Define Unique Value Proposition: Develop a compelling and unique value proposition that sets your product apart from competitors. Identify the key benefits and features that resonate with your target audience. Clearly communicate how your product addresses their pain points and delivers value in a way that competitors cannot.
- Craft a Brand Story: Create a compelling brand story that connects emotionally with your target audience. Develop a narrative that highlights the purpose, values, and mission of your brand. Incorporate your unique selling points into the story to create a strong brand identity that resonates with customers.
- Choose Positioning Strategies: Based on your target audience, competitive analysis, and unique value proposition, determine the positioning strategies that align with your goals. Consider whether you want to focus on differentiation, cost leadership, niche targeting, or other positioning approaches. Develop a clear positioning statement that conveys your product's unique position in the market.
This was an in-depth guide discussing positioning a product or service within the market.
I hope you enjoyed this guide and learned some new concepts that you can apply to your business.
Frequently Asked Questions
What are the 3 C’s of product positioning?
The 3 C’s of product positioning are Customer, Competitor, and Company. Customer focuses on understanding the needs, preferences, and behaviors of your target audience. Competitor involves analyzing the strengths and weaknesses of your competitors to identify opportunities for differentiation. Company refers to evaluating your own unique capabilities, resources, and value proposition to effectively position your product in the market. By considering the interplay between these three elements, you can develop a strong and distinct product positioning strategy.
What are the two major types of product positioning?
The two major types of product positioning are Differentiation and Cost Leadership. Differentiation positioning focuses on highlighting unique features, benefits, or qualities of the product that set it apart from competitors. Cost Leadership positioning emphasizes offering the product at a lower cost or better value compared to competitors. Both approaches aim to create a distinct market position for the product based on either unique attributes or competitive pricing.
Nate Torres is an entrepreneur, growth marketer, and photographer and writes mostly on those topics. Nate runs his own professional photography business and photography blog called Nate Torres Photography. Nate enjoys learning about new digital marketing strategy and new ways to think creatively. He is also a photography speaker and author on Photofocus.