What is Positioning in Marketing: Types, Benefits, and Applications

Market Positioning is the ability to influence consumer perception related to brand or product relative to its competitors. Such type of positioning establishes the image or identity of brand or product to help consumers perceive it in a particular way. Market positioning indicates the ability of a company to positively influence the perception of its consumers about its products and services.

Positioning in marketing aims at creating brand awareness, identifying target customers, and improving the company image.

Table of Contents

• What is positioning in marketing?
• Benefits
• Types of marketing strategies
• Steps to create marketing positioning strategy
• Algorithms used

What is Positioning in Marketing?

Positioning in marketing is crucial since it can either improve or degrade a brand’s image. This is why companies work hard toward implementing techniques for better positioning. Some brands may portray themselves as environmentally friendly brands, luxury brand, customer friendly or innovative brand. Market positioning is an effort toward creating an intended positive image by the company. 

Benefits

Following are the benefits of a better positioning in marketing:

1. Creates a specific image of the brand. 
2. Positively improves consumers’ perception of the brand.
3. Defines the target section of customers.
4. Understand your position amongst your competitors.

Types of Market Positioning Strategies 

Once you have understood the basics of positioning, let us learn about different strategies that are implemented by most companies.

1. Preemptive Positioning 

According to this strategy, the brand claims to be the first to provide a particular benefit, feature, new product, and service. This creates curiosity amongst customers about the product and the company that offers the prototype or new innovation. It also gives the company an upper hand to price the product/ service as it wants to. Let us see real-life examples of this marketing strategy. 

Seiko: In 1998, Japanese electronic giant ‘Seiko’ launched ‘Seiko Ruputer’ which is claimed to be the ‘first watch computer’. It can be claimed as the world’s first smartwatch. The company promoted this watch as a ‘wearable PC’.

IBM: In 1992, IBM and Belself together launched the world’s first touch screen phone called ‘IBM Simon’ Personal Cellular Communicator. This is the world’s first touch screen phone. The product sold 50,000 units in total.

2. Superlative Positioning 

In this strategy, the company presents its product as better than its competitors. They highlight their qualities in a comparative manner to showcase that their brand is better. Let us consider a real-life example of this strategy.

• Wendy’s vs. McDonald’s: In 2022, Twitter was taken over by Wendy’s billboards advertisement that states, ‘hot and crispy fries don’t arch, just sayin’. Since it is starting to be superlative to only one brand, it is a part of comparative advertising.

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• Dove: This is an ideal real-life example of superlative positioning, unlike Wendy’s comparative advertising. Here, Dove is stating its superiority over its competitors by referring to other brands as ‘harsher’.

3. Competitive Positioning

Competitive positioning is a strategy that is used by companies to differentiate themselves from their competitors. Through this positioning, companies define their niche where they can perform better than competitors. It also helps them in understanding the types of products and services that they need to provide to their customers.

Simple: Simple is an American neobank with no branches. To set themselves apart from their competitors, they differentiated themselves through their mobile app during a time when most mobile apps were not that functional. 

Steps for Creating Marketing Positioning Strategies

While creating a marketing positioning strategy, you need to follow the below-given steps in order.

1. Understanding the current marketing position

Primary market research, surveys, feedback forms, and data analysis helps in understanding your company’s current market position. Through this, you can learn about factors currently making your brand hit or flop. You can plan a new strategy based on these points to serve your customer better and improve your brand image.

2. Analysis of Competitors’ Positioning

It is an analysis of the market positioning of the competitors based on which companies make strategic plans. This analysis allows the company to rework its marketing strategy so that it can provide better services, products, prices, and market position. The company assesses the competitor’s current marketing strategies, pricing, client perception of products, strengths, and weaknesses as well. 

One of the methods to do so is by using Weighted Competitive Analysis. The company identifies the attributes that are the most important to its customers. They need to do the same for direct and indirect competitors as well. This analysis helps in identifying the attribute with the most weight, which indicates the highest importance. 

3. Perceptual Mapping To Understand Your Customers

Once you have understood your competitors’ and your own market position, you need to now understand your customers. For this purpose, companies use perceptual mapping. It is a diagrammatic technique used for displaying the perception of existing and potential customers. This mapping technique does not include the perception of the business. 

Market maps or perceptual maps are used by companies to identify the gap between them and their customers. The company can understand how its competitors are perceived among its customers. Based on this map, companies can create informed business decisions to suit their target audience’s needs. 

As you can see on this map, different brands are marked on the parameters of price and quality. Based on the customers’ perception, company can understand the position of its competitors.

4. Positioning Statement

It is a statement prepared by the brand about its services and products that uniquely defines it. It is the process of identifying the market niche for the product. The statement is one of the most important aspects of a marketing plan. Let us take a look at the real-life positioning statements:

Walt Disney:

Nike: 

While creating a positioning statement, you need to add the following elements for better statement:

1. Identifying your niche: It is important to identify your niche in which you will want to expand your business. You need to understand the types of services that you can offer to the customers. 
2. Identifying target audience: Once you have identified your niche, it is important to understand the audience that you are going to serve. This will help you in planning your market startegy for more profits.
3. Understanding their needs: You need to conduct research to understand your customer’s need so that you can offer better services that will create a positive brand image. 

5. Repositioning 

Once you have worked on your strategies for better positioning, one of the important aspects is to position your brand from time to time. This repositioning is important since strategies may fail to be practically successful in the future. The reasons behind the inefficiency of a strategy may be changing trends, new competitors or structural changes within the target market. To do repositioning, you can do the following:

1. Reinforce the features of your product. For this, marketing is an important concept.
2. Research more niches to enter. Do the market research and mapping to explore more areas where you can expand the reach of your brand.
3. Work on brand image in way that suits the need of recent times. Advertising can help in improving the image. 

Algorithms Used in Market Positioning

While companies develop strategies for improving their market positioning, there are algorithms involved in the process. Let us discuss them.

1. Cluster Analysis

Cluster analysis refers to the task of grouping set of similar objects in one group than the other group. Through this analysis, you will be able to divide the market into groups based on similar needs and want. Based on this, businesses can position themselves to appeal to different customer segments. You can determine the competitive sets by clustering brands and products. Based on this you can identify the possibility of creating new products. 

Learn different methods of clustering

2. Conjoint Analysis

Conjoint analysis helps in determining how people value the features, benefits, and functions of a product or service. It identifies the combination of attributes that are most influential on customers for making decisions. Through the final outcome of this analysis, businesses can make decisions of designing a product. It also helps in understanding preferences at individual levels.

Conclusion

We hope that through this article, you have been able to understand what is positioning in marketing. By correctly understanding the aspects of this concept, you will be able to improve your brand image, profits, and customer loyalty.