What is product positioning? What are the different types of product positioning? How do you create product positioning? Why product positioning is really important in marketing? You will find all of your questions answered in this article.
Product positioning plays a crucial role in the success of a product or service in any competitive market.
Companies place their products strategically to a target audience to effectively reach out to them. Positioning basically refers to placing the product rightly in a specific space.
Read: Types Of Market: How Market Plays An Important Role?
Often companies fail to succeed in spite of quality products due to poor marketing segmentation.
Here, we have thoroughly discussed why a company needs to position its product or service rightly to be successful against its competitors.
What Is Product Positioning?
According to Wikipedia, Product Positioning refers to the place that a brand occupies in the minds of the customers and how it is distinguished from the products of the competitors. In simple words, it’s to position a product to a particular target audience.
Brands use product positioning to create an image of their product in the minds of the consumers.
But why do they do it?
To distinguish itself from other brands. It helps to create an identity for their product or brand. What’s the first thing that comes to your mind when you hear about Apple?
Yes, that’s product positioning.
When a company positions its product in a specific market, it helps them to create an impression in the minds of the consumers. Brands use positioning helps to inhibit the perception of a product or service by mentally inducing it in you.
This will help you to understand what actually product positioning is.
Here are a few brands. Read one at a time and see what comes to your mind first.
- Coca Cola
- American Express
What Are The Different Types of Product Positioning?
A company needs to carry out thorough market research and process to establish their own target market and how to successfully position products or establish services against their competition.
Product Positioning is primarily done to segregate branding, advertising, promotion, pricing, product development, sales, distribution, and operations.
The most common types of product positioning are:
Pricing is the most common form of product positioning. If a market is already loaded with competitors selling similar products at a lower price, you cannot stand out as a brand priced in a higher category. Low prices and average quality products always take up a higher market share.
b. Consumer Needs
As a new brand or even an existing company, it’s really important to understand what customers need. You just make and sell what you feel like. You need to fulfill a set of needs to establish in the market.
c. Brand Recognition
This form of product positioning is done when a lot of competition already exists. Companies use something so that consumers can recognize their brand. These can be ads or visual symbols or something which would help them stand out in a crowd.
d. Customer Perceptions
A good way to target customers is by letting them have a prior perception of your brand. Supposedly you donate a part of your profits to help the unprivileged. This would affect a consumer’s buying decision whenever he or she is about to choose your product among others.
While pricing is a primary positioning factor, there are people who always prefer quality and are ready to pay for it. You as a brand can position your product or service as something which offers a superior level of quality and can target customers who prefer quality over price.
f. Customer Service
There are customers who often choose brands that have very strong after-sales or customer service. If you are able to offer friendly and professional services, this would impact customers to choose you over others.
Lastly, convenience. There are supermarkets where you can buy your items, and they will deliver them to you. Even you can directly order online. That’s convenience. Maybe you have nothing unique to offer but have great services that will help users, it will help your brand to stand out among others.
Here are the 7 Steps to Follow to Position Your Product
It’s a whole process. You need to carry the following steps out one by one to create your own product positioning.
1. Identify What You Got
You need to chalk out the benefits your products offer. If you are not convinced to buy what you make, why others will? Supposedly you make chairs. You first need to use them yourself and see if you are convinced or not.
Start with finding what you have and what are the best features in it.
2. Find Out The Best
You need to have a USP. Your product or service has to be unique to score higher against the competition. So, find out what the best you have got and list the USPs. You have to use these features to communicate with the target audience.
3. Finding The Target Audience
Now have to identify who’s your target audience. You need to do this to understand what the needs and what they prefer. Your offerings need to match up to a level of what your audience prefers.
As a marketer, you have to gap up between what customers expect out of you and what you are doing to fulfill them.
Suggested Read: Understanding Consumer Behaviour: How It is Used In Marketing?
4. Creating What Users Want
You can’t make a product and expect it to sell if it’s of no use to the user. The foremost thing to understand is the demand: what customers want and need. You can’t position a product in the minds of the individuals unless you deliver what they are looking for.
Several brands make a common mistake. While they create what customers want, price it affordable but do not communicate. You have to reach out to your target audience. This could either be through social media, advertising, or content.
Put the word out. This may cost you high initially. But in the long term, this will help you to maintain a steady base of customers.
6. Competitor Analysis
Before you choose to position your products, you have to be well aware of all the competitor products available in the same space. Evaluating competitors will provide you with a clearer of what you should do and where’s the gap.
7. Positioning The Product
So finally, after complete evaluation and analysis, it’s time to position your product or service. You now have a clear idea about the target market and the competitors existing in the space.
Pick up your differentiating factor and position the product.
Read: Market Segmentation: How To Maximize Market Share?
Why Product Positioning Is Really Important In Marketing?
The importance of positioning a product can be numbered into the following reasons.
- Reaching out to the right kind of customers.
- Effective positioning to the target audience.
- Letting users know about your product better than others.
- Getting an edge over their competitors.
- Effective advertising and marketing.
- Target users know about the benefits of the product.
- Brand recognition.
- Right pricing depends on the market.
So you need to start by identifying the target market and understand the needs and preferences of the customers to position a product effectively!
Editorial Staff at NextWhatBusiness is a team of Business Consultants having years of experience in small and medium scale businesses.