When companies position their products or services, they are trying to create associations in the minds of their prospective customers. They typically initiate the positioning process by coming up with a great message or tagline—hoping that does the job.
Even if you don't purposely position your products, they are positioned anyway... because all products already have associations in customer's minds. The question is whether those associations are the ones you want people to have.
If you don't purposely position your product, your competition and your customers will do it for you. What's more, you won't like it—because your competitors have an incentive to make sure your position isn't very attractive. Your customers, meanwhile, will have no idea what your products stands for, so they'll come up with something on their own.
Positioning is strategic
There is some confusion about how a position is created. Many people think that a great message is your position, but it's not. A tagline, brand name, or logo are not a position either.
Also, choosing a position without first correctly segmenting the market and targeting a specific segment is just a message; it's not a position.
Positioning is not a tactic; it's a strategic process—the goal of which is to create benefit associations in the minds of your prospective customers. The position should tell them why you can provide those benefits better than your competitors—now and in the future.
The reason you start with positioning is the same reason you start with a foundation for your house: You need an underpinning that can hold up the house of your dreams.
Just like the foundation of a house, positioning statements aren't beautiful, but they provide something to build on.
Craft a positioning statement based on benefits
In your positioning statement, you must first include exactly what customers want and, second, ensure you can provide that better than your competitors, now and in the future. Much like the foundation for your house, it has to stand strong in all situations, even those that change over time.
Your competitors should not be able to override your positioning statement with their own messages. You should be prepared to do what it takes to defend your position over time, and you should have the competencies to do so.
Because positioning is part of a marketing strategy, a good position also takes into account how to purposely migrate your position over time. That's important because positioning happens in people's minds: It's a perception they have, the way they see the world. Unlike preferences (things they care about), which are usually slow to change, perceptions can change much more quickly. Which is why you need to consider the future, not just the present.
The foundation of a positioning statement starts with customer benefits. Benefits relate to basic human needs, goals, and desires. When you start with those benefits, you become customer-focused and obsessed with providing what your customers want.
As I mentioned in an earlier article, the benefits approach helps you to avoid being blindsided by new competitors and substitute products. New competition typically enters by providing different benefits (or enhanced amounts of current benefits) rather than simply new features.
Segment your market on benefits to derive the right messaging
Segmenting the market is a must if you want to create a defensible position.
Here is an example of why it's so important. Several years ago, after I had been positioning the products of technology companies for a few years, the president of Texas Instruments in Europe emailed me and said, "Teach my people to say no!"
What he wanted me to do was segment the market for his digital signal processor (DSP) on benefits to see which ones his marketing and sales force should be targeting, and then position the DSP for that segment (and say no to others). The company had previously broken up the market by size, which created unclear messaging—what happens when you expect one size to fit all. He was also concerned that there might be customers they were missing—i.e., those whom the company's traditional approach could not identify.
Many B2B marketers are asked to focus on vertical markets (e.g., retail, pharmaceuticals, education) or firmographic categories (company size, geography, etc.). As it did for Texas Instruments, that method will result in a message that doesn't target the right market. (Need help with positioning and messaging? Simply contact MarketingProfs DNA.)
Bonus: A focus on benefits also helps you see how to extend your product into new growth areas. Take the classic case of Arm & Hammer, a brand that made baking soda. By noticing that the product provided the benefit of odor control, the company extended the core product into several other markets, including kitty litter, toothpaste, laundry detergent, and more. If they had thought about baking soda merely as a product (what it is) rather than what it does or what it can do—its benefits—they wouldn't have imagined or foreseen growth into new markets.
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As I noted earlier, positioning statements are not beautiful. But, like the foundation of a house, which isn't attractive either, they allow you to build a beautiful house—your messaging—on top of it.
Once you have a solid positioning foundation that will withstand changes over time, you can build a wonderful and deeply powerful message that both connects with customers and remains defensible against competitors.
More Resources on Positioning Strategy
MarketingProfs DNA: Positioning consulting service
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