In this article we analyze positioning marketing through a practical example. We will explain in detail how to apply the right positioning strategy to your business.
Position marketing is critical to reaching our audience and consequently attracting potential new customers.
Positioning marketing “marketeering” definition:
Positioning is the marketing strategy by which a company strives to occupy a unique and well-defined space in the minds of potential customers with its offerings of goods and services.
Now let us take off the shoes of marketeers and see, therefore, with a simple example, what positioning strategy is.
Let us introduce three simple concepts:
- Product or service: that which is produced by a company
- Target audience: our potential customers
- Market: where we want to sell our product or service
We start with the concept that “I can’t sell everything to everyone, otherwise I risk selling nothing to anyone.”
This should be a mantra we use whenever we are carrying out strategic planning for our company.
If I cannot sell everything to everyone, we get that in order to position a product, or define its communication, we have to prepare a market segmentation strategy.
Strategy that matches the classification of existing products, based on certain characteristics that are meaningful to the consumer.
This is part of the company’s strategic positioning.
Purpose of the positioning marketing process
The purpose of the positioning marketing process, is to differentiate one’s product or service as much as possible, from that of competitors.
The goal is for them to occupy a distinct position in the mind of the potential buyer. This process, through the focus strategy, can also lead to the creation of a new market niche.
One of the key elements we need to keep in mind is that the approach should not be from the selling point of view, but from the buyer’s point of view.
It is necessary to consider the product not for what it can offer, but for what customers expect to receive.
As we have seen above, positioning refers to the creation of an image of the product, in the mind of the potential consumer, within the target market, as compared to the competition. This is also referred to as market positioning.
Competitive positioning, on the other hand, occurs when a market is highly competitive, and positioning has the function of emphasizing the positive sides of the product to distinguish it from the competition.
In both the case of market positioning and competitive positioning, one never addresses the entire market, but always a target market.
There are several Modes of positioning against competitors that involve differentiation on the basis:
- to the product, we could call them tangible characteristics such as performance, reliability, design, technology, etc.
- to price, one need only think of Poltronesofà’s strategy.
- To image, where it is difficult to differentiate by tangible features
The important thing is to define your strategy, as clearly as possible.
In the mind of the Italian entrepreneur, mainly due to cultural issues, there is a desire to preside over as many markets and targets as possible. This leads to maximum de-focusing and the worst positioning strategy.
It is essential to have courage, make choices and pursue them to the end.
If we want to open a restaurant in Milan, what is the distinctive element that will allow us to get into the consumer’s head? Which Marketing and Communication Strategy should we use?
If our restaurant has no differentiating elements, it will be yet another restaurant. The words “typical Milanese cuisine,” or “seafood restaurant,” are no longer enough.
Positioning marketing example in the restaurant industry
I’m an entrepreneur, I have some money to invest, and I want to do it in the restaurant business:
- Ethnic restaurant type Vietnamese, Turkish, Kazano. In this case we are targeting a narrow but very specific audience. We will have very little competition and a chance to quickly become a leader in our market.
- Couples-only restaurant. This is a strong countertrend to the all-you-can-eat and giro-pizza restaurants that cater to the whole family and are appearing like mushrooms. Sure, families are definitely larger, but on average they have a lower spending capacity. They can also afford fewer dinners “away from home.”
- Restaurant that caters only to same-sex couples. It is definitely a focused choice. You have identified a specific niche market. Probably 10 years ago it would have been more problematic, not today. Precise, focused target audience with above-average spending capacity and definitely broad. Homosexual people correspond to about 10 percent of the population.
In all three examples, we have defined some strengths that enable us to generate important competitive advantages, compared to “traditional” competitors.
Our Brand, in this way, occupies a very specific position in the mind of our possible customer. It stands out from competing products and very clearly reaches the target audience, our buyer persona.
If this strategy seems absurd to you, or difficult to apply, simply go to a search engine, and search for seafood restaurant. If you are in Milan, the search will return hundreds of results. Try Vietnamese restaurant, and it will be a different story.
Example positioning marketing: how to implement the strategy?
As we mentioned earlier, there are 3 basic elements in strategic marketing: Product or Service, Target and Market.
Let us bring them into our practical example by creating the placement map.
- The Product is represented by Marco, who wants to find a new girlfriend.
- The Target in this case is women, but Marco will have to define in detail what it is like. Then we will see.
- The Market is where Marco will go to propose, or rather hunt, to find a new girlfriend.
Let’s look in detail at how these aspects help define
Example positioning marketing: the 3 main factors to consider
And now let’s look at three basic elements of positioning marketing analysis, the creation of the positioning map, and the different types of positioning marketing.
(a) Market
It represents territoriality. Where the company offers its products and services. It can be local, regional, national or international. While the local market is specific to small businesses, the regional, national and international market is the preserve of both small and large companies.
In Italy, for example, there are SMEs (small and medium-sized enterprises), which generate most of their turnover in foreign markets. Conversely, there are large companies, which only preside over the domestic market. So it is not a dimensional aspect of the Company, but purely strategic and positioning.
(b) Target
They are the people we target. The target audience in marketing is encapsulated in two macro categories:
- B2B (Business to Business), where companies reach out to other companies
- B2C (Business to Consumer), where companies target individuals
Apart from this aspect, it is always crucial to keep in mind that even in B2B we are addressing people. Companies are not abstract entities.
(c) Competitors
These are the companies that offer the same products or services as we do, in our own target markets and to our own potential targets.
Simplifying the concept, if my company produces oil and targets the Italian market, the company next door that produces oil and targets the international market is not my competitor.
On the contrary. A foreign company, which produces oil and distributes it in the Italian market, will be my competitor.
Identifying our competitors, before the advent of the Internet, was definitely clear and easy.
With the advent of the Web and social media, it has become significantly more complicated.
Through positioning analysis and web and social media marketing strategies, a company that has recently positioned itself in the market could very quickly gain important shares, to the detriment of companies that have been manning the same market for years.
This is a key element to keep in mind, because often, when we meet with Entrepreneurs who ask us to help them grow their Business, when asked: what are your competitors? they list only the historical ones.
Those they met at trade shows or those who, oftentimes, steal a customer from them.
They have never bothered to check the “invisible” competitors, those who through the web and social media are gaining the right positioning at the expense of them.
Returning to Wikipedia’s definition of positioning, and analyzing the meaning of market, target and competitors, the importance of defining the strategic positioning of one’s company emerges more clearly.
Want to learn more about how marketing is evolving? Don’t miss these articles:
- The fastest way to become a Market Leader?
- The Power of a Brand: The Focus Strategy
- Branding and target audience targeting
- Market Positioning: Focusing Strategy
- Description of menu dishes: you have to give value to your Product
- Market positioning: what is it for?
- Evolving and focusing to do business. The Sears case
- Strategic positioning: how to design it for your business