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Successful businesses know that having a good product is only part of the battle. Even if you are the best at what you do, that could mean very little if your brand is unable to set itself apart from the competition and capture customers. Positioning your product in the proper market context can help with that.
- Determine what your brand stands for.
“The goal of market positioning is to have your customers perceive your brand as distinct and superior,” Susan Ward, co-owner of the Cypress Technologies IT consulting business, writes in an article for TheBalance’s Small Business.
Most consumers tend to follow a specific brand for years, or even throughout their lives. This highlights the importance of making the right impression from the start, and to refine it — or, if necessary, redefine it — over time.
The first step in positioning your product is to ask yourself the following: What is your customer really buying from you? The odds are good that you are not the only business that sells a product like yours, so it’s possible that your customers are coming to you for other reasons. “Remember that McDonald’s isn’t just selling burgers and fries,” explains Entrepreneur.com. “It sells fast food that tastes the same, no matter when or where it’s ordered, in an environment that’s clean and friendly to families.”
From price and quality to customer service and availability, you should assess the key attributes that set you apart from your competitors.
- Analyze the competition.
The next step in positioning your product is to analyze the competition’s strengths and weaknesses. Ward recommends organizing the information in the form of a matrix or table that compares how strong each of your competitors is across various categories. “Competitive analysis can clearly demonstrate … segments of the market you may wish to avoid, such as those where there is already significant competition, where one competitor has established a dominant position, or where larger competitors exist that have the advantage of economies of scale,” she explains.
This can also help you identify areas of the market that none of your competitors are addressing — or addressing very well — which you could use to your advantage when choosing your positioning strategy.
- Choose your strategy.
Once you have found the gaps in the marketplace, you can use these to focus your positioning strategy. Some typical strategies include quality, service, and value positioning, each with their own demographics. For instance, value positioning targets cost-conscious consumers with competitive pricing, while service positioning targets markets that desire high levels of customer service. “This approach is commonly used by small businesses that are competing with larger chains or big-box stores,” Ward writes.
You can also tailor your positioning strategy to target particular demographic strata, such as education, income level, age, or gender. Whatever you do, don’t try to appeal to everyone. In an article for Business Insider, business owner Denise Lee Yohn explains that “some businesses try to reach everyone because they don’t want to limit their appeal — but history shows, if you try to be everything to everyone, you end up being nothing to no one.” On the other hand, targeting a particular type of person or group gives your brand a stronger identity.
Positioning your product in the proper market context is key to capturing the right customers, the ones who will continue coming back to your business and advertise for you via word of mouth. That being said, the type of marketing strategy you choose may also depend on your financial capability, so be sure to consult with your financial institution while drafting your plan.