Unit 9: Positioning Decisions
and
1. What is Positioning
A customer buys a product to fulfil
his needs or expectations. Now in a market
that is full of products and brands how can he
differentiate between what he should buy and
what not to buy. In addition, a customer
makes his decisions not in a logical manner
but in an emotional manner. He does not go
very much in the specific merits of a product
but rather he makes his decision based on
perceptions about a product and its qualities.
Thus it is very important for a brand to create
the right perception about their product in the
customer’s mind so that when he thinks about
a particular need he recalls the marketer ‘s
brand. It is this creation of an image or
identity for the product, service, brand or
organization in the minds of the target
customer that is called positioning.
Before the product or service is
positioned, the marketer should answer the
following strategic questions about his
market and his products or services:
 What's the customer really buying
from him?
 How is the product or service
different from those of the
competitor?
 What makes the product or service
unique?
Once these strategic questions have been
answered based on the market research, the
marketer can begin developing a positioning
strategy for the business plan. The
positioning statement for the business plan
should not to be long or elaborate, but it must
point out:
a) What the target market is
b) How will we reach the target
customers?
c) What is the customer really buying
from the company?
d) Who are the competitors?
e) What is the Unique Selling
Proposition of the product?
Please understand that the right image or
positioning is powerful marketing tool. To
make it work the marketer must follow these
steps:
1. Create a positioning statement for
the company. A short statement that
differentiates the product or
company from your competition.
2. Test the positioning statement. Does
this positioning appeal to or resonate
with the target audience or not? This
process must be repeated until we
have a statement that communicates
the fulfilment of customer ‘s wants
and needs.
3. Use the positioning statement in
every form of communication that
the marketer makes to the
customers. This reinforces the
message at several levels to the
customers.
4. Create visual materials that
communicate your positioning to
your customer and sales channel. A
visual is remembered far more than
a written communication and so
must be used effectively.
5. Include your people while creating
the communication – both visual
and written – plan. This helps
employees understand how to
communicate your positioning to
customers.
2. Product Positioning Process
Generally, the product positioning process
involves:
2.1. Define the market
 The first step in defining the
positioning is to define the market in
 which the product, service or brand
will compete. We must understand
who the buyers are in the market. This
market comprises of all the products
and services that can interchangeably
be used by the customer because of
similar usage characteristics or prices.
The market needs to be defined
because it is in this sphere that all
products and services will compete
with each other for business and
market share. The extent of
competition and substitute products
in this market will determine the
pricing of the product and the
premium over other organizations
that the company may be able to
charge.
2.2. Identify product attributes that define
product 'space'
 When we define the market we
consider ‖all the products and services
that can interchangeably be used by
the customer‖ and we know that each
product comprises of several
attributes. Thus we can say that the
market in which the product exists is
a space made up of a combination of
attributes. In order to define the
boundaries of the space in which the
product will function if we can define
the right attributes it will help us in
defining the competition better and
therefore positioning our product.
2.3. Collect information about customer
perception
 Customers perception about products
is an important element in the
positioning of the product. In order to
position we need to understand which
attributes the customer gives greater
weight age. One important tool used
to map these is the technique of
Perceptual mapping. In order to make
the perceptual maps we need to
collect customer information about
his perceptions about each attributes
not only for the company’s product
but also about competing products.
However, since perceptual maps have
a limitation in terms of how many
attributes can be shown at any time,
we must select key attributes that will
have a significant impact on
positioning and provide a position
that is sustainable in the long term. A
sustainable positioning will also
impact profitability of the product and
company. Information on customer
perceptions is collected through
detailed market surveys and several
statistical methods but we must be
careful to construct the research
carefully otherwise data collected will
give data that will seem to validate
decisions that the company already
knows. The data collection can be
done based on perceived differences
between products or between
perceived similarities between them
from a sample of customers by
surveying them about their
perceptions of each product on the
relevant attributes.
2.4. Determine each product's share of mind
 One of the main objectives of
advertising and promotion is to
establish what is called share of mind.
When people think of examples of a
type or category of product, they
think of a limited list of products or
brands. Any product included in this
list has mind share. Hence while
positioning it is important to estimate
the various mind share of competing
products and to see what position you
can create for your product that will
be distinct from others and will be
sustainable over the life of the
 product. Sometimes in certain
product categories a certain product
or brand has a dominant mind share.
A dominant mind share is when a
product or brand name becomes
synonymous with the category, for
example, Kleenex brand tissue was
only a brand but it has since become a
common to use it as a term to identify
any tissue similarly Xerox has
become synonymous with
photocopying.
2.5. Determine each product's current
location in the product space
Perceptual mapping is a graphics
technique used by marketers to visually
display the perceptions of customers or
potential customers relative to their
competition. For a marketer to understand the
relative position of various products in the
market becomes easier if we plot these
attributed on a two dimensional plot called a
Perceptual Map.
2.6. Determine the target market's preferred
combination of attributes
For every target market there is a
combination of attributes that is ideally
preferred. In order to achieve a position of
strength and occupy a large space in the
consumers mind the positioning must aim to
come as close to this ideal combination of
attributes as possible. If we undertake the
preference regression to map the market the
ideal vector will give us the direction for
positioning. However, we still need to arrive
at a set of attributes that we must consider
based on research that has been conducted
amongst the target audience/ market segment.
The most important of these must be
considered while making a perceptual map
for arriving at an ideal vector.
2.7. Examine the Fit and Position
Once all the data is available about
the attributes desired by the customer in the
target market and the competing products in
the market with the space they are already
occupying the marketer is ready to position
his product. He has with him the ideal vector
desired and also the spaces available in the
market where he can position his product.
Now following an iterative process of
positioning his product in a position and
evaluating it in comparison with other
competing positions and the ideal vector he
must arrive at a position that can be used by
the company to profitably launch and sustain
the product through its life cycle. It may to
always be possible to get an ideal fit because:
 Some competitor may already be
occupying a position close to the ideal
vector.
 It may not be possible for the
company to produce a product that
will be close to the ideal vector.
 The customer expectation may not be
realizable given the stage of
technology available at present.
3. Positioning and Repositioning
Positioning means creating a position,
image or identity in the consumer ‘s mind.
Most of the time and effort of a marketer is
spent in creating this position or reinforcing
it. Positioning is an important part of the
product strategy and must be undertaken
carefully because any change in the position
is an expensive, difficult and time consuming
process. We are not sure that a change in
position will be accepted by the customer.
Repositioning
 competitive pressures – because of
new competitor entering the market,
new channels and changing
customers’ needs sometimes push
 the marketers towards wanting to  Making the brand serious
reposition the brand. However, this  Bringing in new customers into the
is not an easy task. Many marketers target segment
despite their increased spend on  Making the brand contemporary
trying to reposition their brand are  Differentiate the brand from other
not successful. brands
Some of the key factors to be kept in mind  Changed market conditions.
while repositioning the brand are:
o Any change in positioning must
continue to stay relevant to the
customer. The Marketer must
evaluate the customer‘s current
attitudes and the status of the market
with its competing products.
o Any brand repositioning must be a
logical extension of the existing
position. If the customer sees that the
position does not have a relevance to
the earlier position then he will reject
the product. The product will
therefore lose its existing set of loyal
customers.
o The company or product must be able
to live up to the new position created.
For the company to ensure that they
are delivering on the new positioning
they must closely monitor the market
an also give the customer enough
metrics by which to measure/
understand that the company is
delivering on the new positioning.
o The repositioning must be based on
goals that the company sees as
realistic rather than exclusively on
what the management think they want
the goal to be.

There are several reasons for repositioning‖

 Mostly falling or stagnant sales is
responsible for repositioning
exercises.
 Image mismatch between current and
desired position
 For increasing product relevance to
the consumer
 For increasing occasions for use