Developing and Communicating a Positioning Strategy

All products can be differentiated to some extent.39 But not all brand differences are meaningful or worthwhile. A difference is worth establishing to the extent that it satisfies the following criteria:

^ Important: The difference delivers a highly valued benefit to a sufficient number of buyers.

^ Distinctive: The difference is delivered in a distinctive way. ^ Superior: The difference is superior to other ways of obtaining the benefit. ^ Preemptive: The difference cannot be copied easily by competitors. ^ Affordable: The buyer can afford to pay for the difference. ^ Profitable: The company will find it profitable to introduce the difference.

Each firm needs to develop a distinctive positioning for its market offering. Positioning is the act of designing the company's offering and image to occupy a distinctive place in the target market's mind. The end result of positioning is the successful creation of a market-focused value proposition, a cogent reason why the target market should buy the product.

The word positioning was popularized by two advertising executives, Al Ries and Jack Trout. They see positioning as a creative exercise done with an existing product:

"Positioning starts with a product. A piece of merchandise, a service, a company, an institution, or even a person. . . . But positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. That is, you position the product in the mind of the prospect."

Ries and Trout argue that well-known products generally hold a distinctive position in customers' minds; Coca-Cola, for example, holds the position of world's largest soft-drink firm. To compete against this kind of position, a rival can (1) strengthen its own current position in the consumer's mind (the way 7-Up advertised itself as the Uncola), (2) grab an unoccupied position (as Snapple did with its tea-based beverages), (3) deposition or reposition the competition, or (4) promote the idea that it is in the club with the "best."40

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