Your brand positioning strategy all starts with your target audience

Your product positioning strategy must be done before launch and tuned as the strategy matures.

I believe that any company or brand can be differentiated with the right target audience and supporting positioning strategy.

There is no such thing as a commodity. Instead of thinking you are selling a commodity, you must see yourself as handling an undifferentiated product waiting to be turned into a differentiated offer.

Don’t believe me? Have you bought a bottle of water?

What is positioning strategy in marketing?

Positioning is a marketing concept that outlines what a business should do to market its product or service to its customers. The positioning is created through the use of promotion, price, place, and product. The more focused a positioning strategy is, the more effective the plan is for a company.

There are dozens of ways to differentiate an offer. Part of the answer lies and recognizing that buyers have different needs and are therefore attracted to different offers.

At the same time, not all brand differences are meaningful or worthwhile. Not every difference is a differentiator. Each difference has the potential to create company costs as well as customer benefits.

Therefore, the company must carefully select the ways in which it will distinguish itself from competitors. A difference is worth establishing to the extent that it satisfies the following criteria:

Many companies have introduced differentiations that failed on one or more of these tests. The Westin Hotel in Singapore advertises its hotel as the world’s tallest hotel, actually, this is not important to many target customers and in fact, turns many of them off.

Differentiation is the act of designing a set of meaningful differences to distinguish the company’s offer from competitors’ offers.

Not all buyers will notice or be interested in all the ways one-brand differs from another. Nor is it useful for a company to describe exhaustively to each prospect every detail of difference.

Each company will want to promote those few differences that will appeal most strongly to its target market. The company will want to develop a focused product positioning strategy. I’m going to simply call this positioning and define it as follows:

Positioning is the act of designing the company’s offer so that it occupies a distinct and valued place in the target customers’ minds.

Positioning calls for the company to decide how many differences and which difference is to promote to the target customer.

Positioning starts with a product. A piece of merchandise, a service, a company, an institution, or even a person. But positioning is not what you do to a product. Positioning is what you do to the mind of the prospect, that is, you position the product in the mind of the prospect.

The company must not only develop a clear positioning strategy, but it must also be communicated effectively. Supposed a company choose is the best in quality positioning strategy.

It must make sure that it can communicate this claim convincingly. Quality is communicated by choosing those physical signs and cues that people normally used to judge quality.

Here are some examples:

Choosing a Positioning Strategy

The positioning strategy combines the marketing mix components into a bundle of actions designed to achieve a particular positioning objective.

The positioning strategy (1) determines total resources to be used for the marketing program; (2) indicates how to allocate the resources among products, distribution, price advertising, and personal selling; and  (3) allocates the resources within each program component. These marketing positioning decisions:

Selecting a positioning strategy is a combination of management judgment and experience, trial and error,  some experimentation, and sometimes survey research.

Finding the ideal positioning strategy is probably impossible in most situations. Nevertheless, good strategies can be selected through sound analysis. The positioning process is shown in Exhibit 1 below.

Factors Affecting the Positioning Strategy

The positioning concept provides a unified theme for strategy design and implementation. The starting point is the target market that marketing management has selected.

Market opportunity analysis supplies information about the characteristics and the people and organizations in the target market.

The programming task is to estimate the responsiveness of the target market to alternative positioning strategies while taking into account the competition, management’s performance criteria (e.g., sales, market share, profit contribution), and available resources.

The same factors are considered in making the target market decisions. Marketing management is considered with finding the best fit between the market target and a positioning strategy.

[et_bloom_inline optin_id=optin_12]

The positioning concept management selects is focused on customer needs. The characteristics and needs of the target market indicate the nature of the marketing program necessary to gain a favorable response from the target market.

For example, if the people in the target market want a high-quality product, then meeting their expectations requires a marketing mix that is perceived as providing high-quality.

The market target also helps to identify existing key competitors. Similarly, the choice of the market target will establish a feasible objective for sales and market share.

Finally, the selection of the target market must consider the company’s resource capabilities for serving the target market. The objective in building the marketing program is to work within guidelines established by the market target strategy.

The stage of the product market lifecycle often alters the role and importance of the different marketing program components. In moving through the introductory, growth, maturity, in declining stages, the role of the marketing mix must be adjusted to respond to changing conditions.

Price, for example, typically declines as the product market matures. Advertising is initially used to create awareness of a new product into interest potential buyers in the offering. At later stages, advertising may stress the advantages of one-brand over competing brands.

Management’s performance criteria for the market target also have a major influence on the positioning strategy selected.

Depending on management?s priorities, emphasis may be on expanding market share, holding a position and generating profits, reducing the firm’s commitment, or actually leaving the product market.  

Thus, the positioning strategy is tied to the strategic business unit (SBU) strategy. Each alternative calls for a quite different marketing program.

If marketing management is shaping a major growth program while the SBU management favors a stabilizing position, conflict is inevitable. What top management wants to do in an SBU must correspond to the selected positioning strategy.

Wrap Up

Positioning is the act of designing the company’s offer and image so that the target market understands and appreciates what the company stands for in relation to its competitors.

The company’s positioning must be rooted in an understanding of how the target market defines and makes choices among vendors. The positioning task consists of three steps.

First, the company has to identify the possible product, services, personnel, an image of differences that might be established in relation to its competition. Second, the company has to apply criteria for selecting the most important differences. Third, the company has to effectively signal to the target market how it differs from its competition.

The company’s product positioning strategy will then enable it to take the next step, namely, plan its competitive marketing strategies.

When I?m working with clients during a positioning strategy session, I ask ?what comes to mind when I say computers?? And I get an answer like Apple or Dell or IBM.  

What is the first word that pops into your head? That single word is called mindshare. What do your target customers to target audience think about your brand?

There are different positioning strategy types, repositioning strategy, and competitive positioning strategy.

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General FAQ’s

How you classification your products has an impact on your marketing strategy implementation.

I will examine the classifications of products. An explanation of each marketing mix element as it relates to the classification of durable goods, nondurable goods, and services.

You can download this article as a product classification pdf. We will go through the classification of consumer products and B2B products. Product classification marketing is dependent on what channel you choose to activate.

A product (a good) is anything that can be offered to a market for attention, acquisition use, or consumption that might satisfy a want or need.

Most products are physical products (or goods), such as shoes, automobiles, skis, mountain bikes, and books. But services—such as marketing services, concerts, and vacations are also products (sometimes called services products).

Marketers have traditionally classified products based on varying product characteristics.

Each product type has an appropriate marketing mix strategy marketing concepts and tools present the major classifications for Consumer and Industrial Products and their marketing strategy implications.

With this background, we are ready to examine company decisions regarding the product mix product lines and individual products.

Durable Goods, Nondurable Goods, and Services

You can classify products into three groups according to their durability or tangibility.

• Nondurable Goods:  Nondurable goods in one or a few uses. Examples include coffee, soap, and salt. Since these goods are consumed fast and purchased frequently. Therefore, the appropriate strategy is to make them available in many locations, charge only a small markup, and advertise heavily to induce trial and build preference.
• Durable Goods:  Durable goods are tangible goods that survive many uses. Examples include machines clothing, and machinery. Durable products require more personal selling and service demands a higher margin and requires more sellers guarantees.
• Services: Services are activities, benefits, or satisfaction that are offered for sale. Examples include oil changes for your car and home repairs. Services are intangible, inseparable, variable, and as a result, they require more quality control, supplier credibility, and adaptability.

Consumer Goods Classifications

Consumers buy a vast number of goods and services. A useful way to classify these goods is based on consumer shopping habits, because those habits have implications for marketing strategies.

We can distinguish between convenience, shopping, specialty, and unsought goods.

Classifications of Products

Goods that the customer frequently purchases with a minimal amount of effort in comparison shopping. Examples include soda, candy, and newspapers.

Convenience goods can be further divided into impulse goods, emergencies goods, and staples. Staples are products that consumers purchase regularly. For example, one buyer might routinely purchase Heinz Ketchup, Colgate toothpaste, and Ritz crackers.

Impulse goods are purchased with no planning or search effort. These goods are usually available in many retail outlets because customer typically doesn’t look for them.  

You will find candy bars and magazines place next to the checkout counters because shoppers may not have thought of buying them until they spot them in a convenient location.

Emergency goods are purchased when they need is urgent. For example, umbrellas during a rainstorm, salt for icy driveways, and aspirin if you have a headache. Manufacturers of emergency products will place them in many outlets to capture the sale when the customer needs the products.

Shopping Goods

Goods that the customer, in the process of selection and purchase, characteristically compares on the basis of suitability, quality, price, and style. Examples include clothing, appliances, and automobile.

Shopping goods can be divided into homogeneous and heterogeneous goods. The Buyer sees homogeneous shopping Goods as similar in quality but different enough and price to justify shopping comparisons. The seller has to talk price to the buyer.

However, when shopping for clothes, furniture, and more heterogeneous goods, product features are often more important to the consumer than the price if the buyer wants a plain suit the cut, fit, and look are likely to be more important than the small price differences.

The seller of heterogeneous shopping Goods must there for carrying a wide assortment to satisfy the individual taste and must have well-trained sales Personnel to provide information and advice to customers.

Specialty Goods:

Goods with unique characteristics and our brand identification for which a significant group of buyers is habitually willing to make a special purchasing effort.

Examples include specific brands and types of fancy goods, cars, audio components, and men’s suits.

An Audi, for example, is a specialty good because buyers will travel far to buy one. Specialty goods do not involve the buyer and making comparisons. Buyers invest time only to reach dealers carrying the desired products.

The dealers do not need convenient locations, however, they must let prospective buyers know about their locations.

Classifications of products for sporting goods will help keep things organized.

Unsought Goods:

Goods that the customer does not know about or knows about but does not normally think of buying.

New products, such as carbon monoxide detectors and paper shredders, are unsought Goods until the customer is made aware of them through advertising.

The classic examples of known but unsought goods are cemetery plots, life insurance, and encyclopedias.

Unsought Goods require substantial marketing efforts in the form of advertising and personal selling. Some most sophisticated personal selling techniques have developed from The Challenge to sell to sell unsought goods.

Industrial Goods Classifications

Companies by a vast variety of goods and services. The useful industrial good classification would suggest appropriate marketing strategies in the industrial market.

Industrial goods can be classified into how they enter the production process and their relative costliness.  We can distinguish three groups: materials and parts, capital items, and supplies and services.

Materials and Parts:

Materials and Parts: Goods that enter the manufacturer’s product completely. They fall into two classes:  Raw materials and manufactured materials and parts.

Raw materials fall into classes: farm products (e.g., fruits, cotton, livestock, corn, and wheat) and natural product (e.g., crude petroleum, fish, and lumber). Each is marketed somewhat differently. Farm products are supplied by many producers.

They turn over their products to marketing intermediaries, who provide assembly, grading, storage, distribution, and selling services.  Farm products are somewhat expendable in the long run but not in the short run. Farm product’s perishable and seasonal nature gives rise to special marketing practices.

Their commodity characteristics result in little advertising and promotional activities, which some expectations. From time to time, commodity groups will launch campaigns to promote the consumption of their products–potatoes, milk, and peaches. And some producers brand their products, for example, Chiquita bananas and Sunkist oranges.

Natural products are limited in supply. They usually have great bulk and low unit value and require transportation to move them from producer to customer. They are fewer and larger producers, who often market them directly to industrial customers.

Because the users depend on these materials, long-term contracts are common. The homogeneous materials limit the amount of demand creation activity. Price and delivery reliability are the major factors influencing the selection of suppliers.

Capital Product Items

Capital product items need to have classifications of products.

Goods that enter the finished product partly. They include two groups of installations and accessory equipment.

Installations consist of buildings (e.g., manufacturing plants and offices)  and fix equipment (e.g., drill presses, computers, elevators, and generators).  

Installations are major purchases. They are usually bought directly from the producer, with a typical sale preceded by long negotiations.

The producers use a skilled sales force, which often includes sales engineers. The producers have to be willing to design to specification and supply postsale service. Advertising is used, but it’s much less important than direct selling.

The accessory equipment comprises portable factory equipment and tools (e.g.,  Forklift trucks, and hand tools) and office equipment (e.g., Desks and computers).  These types of equipment do not become part of the finished product. They help in the production process.

They have a shorter life than installations but longer life than operating supplies. Although some accessory equipment manufacturers sell direct, more often they use middlemen because the market is geographically dispersed, the buyers are many, orders are small.

Quality, features, price, and service are major considerations in vendor selection. The sales force is more important than advertising, can be used effectively.

Supplies and Services:

Items that do not enter finished products at all.

There are two kinds of suppliers and services:  Operating supplies (e.g., pens and paper, coal, and lubricants) and maintenance and repair items (cleaning supplies, nails, and paint). Supplies are the equivalent of convenience goods in the industrial field.

They are usually purchased with a minimum effort on a straight re-buy basis in the purchasing department. It’s commonly called an open purchase order or open PO.  

These products are normally marketed through intermediaries because of the large number of customers, the geographic dispersion, and the low unit value. Price and service are important considerations, since suppliers are quite standardized, and brand preferences are not high.

Business services include maintenance and repair services (e.g., computer repair and office cleaning)  and business advisory services (e.g., advertising, management consulting, and legal services). Maintenance and repair services are usually supplied under a contract.

Maintenance services are often provided by small producers, and repair services are often available from the manufacturers of the original equipment. Business advisory services are normally new buying situations, and the industrial buyer will choose the supplier based on the supplier’s reputation and people.

Therefore we see that product characteristics will have a major influence on marketing strategy. The marketing strategy will also depend on other factors, such as a product’s lifecycle stage, competitors’ strategies, and economic situation.

Wrapping Up for Classifications of Product

The classifications of products and their marketing strategy implications are essential to marketing managers. Market structure definition and analysis establish an important foundation for market segment identification and analysis of competitive advantage.

So whether you are launching or marketing a mature product, the classification for durable goods, nondurable goods, and services is critical and will impact your marketing strategies and budgets.

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General FAQ’s