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Positioning of Service

Positioning your service is the first step in the marketing process. More
specifically - defining your best target client. Once you do that tailoring the rest
of your marketing mix becomes pretty straight forward. When defining a target
niche, identifying too wide a base, means you specialize in none. Think of Sears..
the original low cost department store. In their Halcyon days they dominated the
landscape... but over the years Sears added more and more services to appeal to
more and different clients... adding better fashions to their lower cost items for
example.
Next thing they knew, along came Wal-Mart, Target, and Home Depot. These new
competitors all focused and stole customers from Sears. The take away narrowing your sights can establish a beach head and increase your success.
One more thing about niches - do the difficult thing. That is, focus on being able
to service the niche that requires greater skills. It reduces competition for those
specific clients... and prospects in all the niches that are easier to serve will
implicitly know you can fulfil their needs... So focusing can actually broaden your
prospect pool.
POSITIONING:
Positioning is about communicating your unique selling advantage or proposition
to your target audience in everything you do. Marketing, sales, customer service.
The consistency helps your customer remember. Positioning allows a marketer to
think about why a customer would want to do business with them. What do you
offer that the other producers don't? What does a potential client get by doing
business with you, that will serve their needs well?
Positioning has three components:
What are your strengths? Your distinctive competencies? What about your
offerings provide value to your customers?
Who is your target customer? What about them, makes them an ideal fit for the
value you offer?
How are you different from your competitors in ways that your customers and
potential customers will value? In other words, what is your unique selling
proposition? Your competitive advantage?
When all three are put together, you have a positioning statement. Positioning
statements are the basis for all marketing messaging, sales scripts, and at a
corporate level: branding. What we want are relationship customers. No one
survives in business with out a strong reputation and referral customers.
When you consider the big picture, positioning is everything. It drives marketing
plans, websites, recruiting and sales scripts. It is the basis of every conversation,
every sales call, every customer service interaction.

ROLE & IMPORTANCE OF POSITIONING:


Importance of Positioning can be described in following points:
(1)Underlines the search for competitive advantage
(2)Market segmentation forms the basis for focused strategies
(3)Distinguishes a brand from its competitors
(4)Conduct internal, market & competitor analysis
(5)Plot competitive strategies

Four Principles of Positioning Strategy


1.
2.
3.
4.

Must establish position for firm or product in minds of customers


Position should be distinctive, providing one simple, consistent message
Position must set firm/product apart from competitors
A company cannot be all things to all peoplemust focus its efforts

POSITIONING MAP:
Products or services are 'mapped' together on a 'positioning map'. This allows
them to be compared and contrasted in relation to each other. This is the main
strength of this tool. Take look at the basic positioning map template below

The marketer would draw out the map and decide upon a label for each axis.
They could be price (variable one) and quality (variable two), or Comfort
(variable one) and price (variable two). The individual products are then mapped
out next to each other any gaps could be regarded as possible areas for new
products
Trout and Ries suggest a six-step question framework for successful positioning:
1.What position do you currently own?
2.What position do you want to own?
3.Whom you have to defeat to own the position you want.
4.Do you have the resources to do it?
5.Can you persist until you get there?
6.Are your tactics supporting the positioning objective you set?

STEPS IN DIFFERENTIATION
Porter recommended an eight-step approach to determine the bases of
differentiation and selecting a differentiation strategy. More specifically, the
differentiation exercise would follow the following steps:
The first step is to determine who the real buyer is. In other words, within the
overall buying cycle who would interpret your offer and decide. It is possible that
apart from the end user, channel members may also be the buyers.
The second step in this process is that the firm must identify the direct and
indirect impact on its buyers value chain to determine the value the firm should
create for its buyers. A firm must explore all possible options to influence the
buyers value chain in its direction. Such an analysis of buyers value chain would
provide a foundation for determining the buyer purchase criteria (BPC).
Therefore, logically, the third step is to rank the buyer purchasing criteria. At
times, such an analysis might suggest purchase criteria that the buyer does not
currently perceive. However, the same must be identified in a manner that it can
be operationalized, and their list of buyer purchase criteria on a continuous basis
to sustain competitive advantage. Such an inventory of BPC is then divided into
two categories; use criteria and signalling criteria.
The fourth step is that the firm must identify its existing sources of uniqueness
in relation to its competitors and also the potential new sources of uniqueness,
because differentiation stems from the uniqueness of firms value chain. Since
differentiation is always relative, a firms value chain must also be compared
with the value chain of competitors. Such an exercise should result in the
identification of specific factors of uniqueness, termed as drivers.
The fifth step then is to study the cost implications of all the indemnified
factors, both use criteria and signaling criteria, which can lead to differentiation.
The sixth step is to choose the configurations of value activities that create the
most valuable differentiation for the buyer.
The seventh step is to check the sustainability factor of your chosen
differentiation strategy. Sustainability has to be checked against erosion or
imitation. Kotler has observed that in services industry imitation is easy to copy,
but some companies have been able to cross this stage successfully.
The last stage is that of cost reduction in activities that do not affect the
chosen forms of differentiation. Such a strategy would not only improve
profitability but also reduce vulnerability to competitors because of price
premium.
In fact, successful differentiation strategies communicate multiple forms of
differentiation throughout the value chain. After all, the value created for the
buyer must be perceived by the buyer if it is to be rewarded with a premium
which means that the firm must communicate their value to the buyer through

an appropriate marketing communication mix. If these stages are carefully


analyzed, then one can develop such differentiation strategies, which are not
only implementable but also sustainable, and give a competitive advantage to
the organisation