Product Positioning Strategy Example

On October 5, 2010, in Product Positioning, by Amanda

Product positoning is a part of market positioning.  Market positioning defines how your
business, product, and brand fit into the market. All three should work together seamlessly and
create the overall “image” about you, and your business. These help define your overall market
positioning, and from there you can create a working strategy:

Brand Positioning
Product Positioning
Business or Organizational Positioning

Pretty easy huh? In other words, all 3 of these positioning strategies should be taken into account
for overall market positioning success. A good market positioning strategy takes all these
aspects, with the customer’s needs first. Your business should cater to that target customer.

Let’s start with the product, since that’s usually the “idea” that gets Entrepreneurs and businesses
going.

Product Positioning

Product positioning is how your product fits into the market. Why will customers buy your
product? What value does your product offer? Is there additional values that enhance your
product positioning? Can your product be positioned to compete? Further, do you have the
resources in place to compete on pricing?

Start by asking yourself is your product disruptive, or is it streamline? Disruptive products

disrupt traditional markets, and are known to be “out of the box” or “never heard of”. There’s
alot of risks associated with positioning these products, so it’s important to prove your concept
first. Steamline products are similar to other product positioning in the market, but they need a
competitive advantage to survive: the competitive advantage is usually given by product
positioning as added value, and less costs.

It’s very likely you’re a steamline product, so I’ll use that example in our product positioning
strategy.

Product Positioning Strategy Example

Start by defining each component of your product positioning provided in this example:

Pricing Example
Is your product a luxury item (Macy’s is an example of product positioning in the luxury
market), direct cheap (example here would be a goodwill or value store, such as Ross or
Marshall’s), or in the middle (Target’s product positioning is in the middle of the market).

Quality Example

What’s the overall quality of your product? How is your product positioning against the other
products quality in your market? Total quality is a much used and abused phrase. But is your
product well produced? Do you back your quality claim with money back guarantees? 
Warranties?  Do you charge for those warranties?

Service Example

How does your strategy position your product in terms of service?  Do you offer the added value
of customer service and support? Is your product customized and personalized?  Does the
customer’s name appear when they log into your site?  How you deliver service to the customer
is an important part of customer segments and customer relationships.

A good example of product service is support forums. Many companies are converting to these
as means of service, and allow customers to help solve one anothers problems.

Distribution Example

What’s your strategy to help customers obtain your product? The channel or distribution is a
very important part of product positioning.  You need to make it easy for customers to find your
product, and it needs to be easy to deliver your product.

Product distribution channels can include partners, teams, and affiliates.  As well as internet
marketing strategies.

Packaging Example

Packaging makes a strong statement. Make sure it’s delivering the message you intend.  Also,
your product packaging is very important in appealing to customers.  Does it visually appeal to
them?  How well is your product positioning against other’s in terms of your packaging?

Product Positioning is really just a competitive strategy for your product or service. What’s the
one thing you do best? What’s unique about your product or service? Identify your strongest
strength and use it to position your product.

A large part of your success as an Entrepreneur involves defining your product positioning, and

developing a strategy around this. Developing a product positioning strategy can be challenge for
any business. Espcially a new business or start up; but this can apply to businesses repositioning
themselves in the market as well.
Examples of marketing objectives follow:
Increase product awareness among the target audience by 30 percent in one year.

Inform target audience about features and benefits of our product and its competitive
advantage, leading to a 10 percent increase in sales in one year.

Decrease or remove potential customers' resistance to buying our product, leading to a

20 percent increase in sales that are closed in six months or less.

If you have multiple objectives, make sure they are consistent and not in conflict with each other.
Also, be sure that the remainder of your marketing plan components - the marketing strategy,
budget, action programs, controls and measures - support your marketing objectives.

Setting your marketing objectives and finalizing the remaining components of your marketing
plan may serve as a reality check: Do you have the resources necessary to accomplish your
objectives?

The marketing strategy section of your plan outlines your game plan to achieve your marketing
objectives. It is, essentially, the heart of the marketing plan. The marketing strategy section
should include information about:

 Product - your product(s)and services

 Price - what you will charge customers for products and services
 Promotion - how you will promote or create awareness of your product in the
marketplace
 Place (distribution) - how you will bring your product(s) together with your customers.

These are the "4Ps of marketing":

 Product
 Price
 Promotion
 Place (distribution)

However, brief explanations of what should be included in the marketing strategy section of your
marketing plan pertaining to the 4 Ps appear below.

Product Description
A product can be a physical item, a service, or an idea.
  Describe in detail your products or services in terms of the features and benefits they
offer customers.
 Describe what you need to have or do to provide your product or service (how it's
produced).

Pricing
List the price of your products and describe your pricing strategy. List price ranges for product
lines. For example, if your product is a line of cosmetics, include information in this strategy
section about your lipsticks "ranging in price from $5.00 to $15.00 per item" rather than a
detailed product price list. (You should, however, consider including a detailed price list in the
Supporting Documents section.)

Describe any price flexibility or negotiating room, as is common with large purchases such as
houses or cars. Outline any discounts you offer for long-term customers, bulk purchases or
prompt payment. Also, include the terms of sale, such as "net due in 30 days," extended payment
plans, and whether you accept credit cards.

Promotion Plan
A promotion plan describes the tools or tactics used to accomplish your marketing objectives.

If your marketing objective is to: Then tools or tactics might be:

Create awareness of baby care
products among mothers of newborns.
 Advertise in baby care or motherhood magazines.
 Distribute product samples to obstetricians.
 Offer free baby care seminars to expectant
mothers.

 Distribute free samples or discount coupons at

high school football games.
Increase sales of potato chips to teens.
 Sponsor an event attended by teens.

In your Action Programs section, you will describe the steps that need to be taken in detail, when
they should be done, who will do them, and so on.

Placement (Sales and Distribution)

In this section, describe how your products and customers "meet" or come together through sales
and distribution.

Describe your sales philosophies and methods. Do you employ an aggressive sales method for a
large number of quick sales, or a relaxed method where the emphasis is on having customers feel
comfortable to come back another time even if they don't buy now? Do you use contract sales
people or employees? Explain your approach to sales issues.

Describe your distribution system. (Where will your product be placed so customers have access
to it?) A few points about distribution to address in your marketing plan are:
 Is the exchange of the product made in a store? Through the mail? Through a direct sales
representative?
 What are your production and inventory capacities? (How quickly can you make products
and how many can you store?)
 Are there cyclical fluctuations or seasonal demands for your products? For example, if
you produce Christmas decorations, how will you manage peak production and sales
periods as well as slow periods?
 Do you sell to individuals or to re-sellers? Your company may use more than one
method. For example, you may sell directly to customers who place large orders but also
sell to customers who buy small quantities of your product through retail outlets.