Market Positioning - Definition, Types, Benefits, Examples & How-to (2023)

Imagine you want to be, let’s say, a detergent manufacturer, and there are thousands of other detergents in the market. Why do you think customers will buy your detergent from a cluster of “million options”?

However, if your detergent has unique features that can give your customers unique benefits, then that is a different story. People don’t want to buy a product that claims to do “everything.” Instead, they want a better solution that can tackle at least “something.” You just need to show them that your detergent can specifically do “this.”

To cut it short, you need to position your product or service uniquely. In marketing terms, this is called market positioning. Why is market positioning important, and what are your options regarding market positioning? Let’s find out.

Table of Contents

What Is Market Positioning?

Market positioning, in simple words, is a marketing strategy that focuses on creating a unique image or perception of a brand, product, or service in the customer’s mind. A business can create that unique image by any means.

For instance, the four Ps of marketing (promotion, product, price, and place) are important factors in market positioning. The more a business focuses on these 4 Ps, the will better will be its positioning in the market. Still not getting a clear picture of market positioning? Here are some examples for basic understanding:

  • A shoemaker specializes in making formal shoes for highly sophisticated or formal events.
  • A fast-food franchise that makes unique grilled beef burgers.
  • A car manufacturing company specializes in manufacturing luxury cars with unparalleled features.

So, what was the basic theme in these examples? The sellers in these examples are focusing on a specific niche rather than catering to a general audience.

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Types Of Market Positioning

Different businesses use different techniques for market positioning. However, here some of the most common types of positioning in the market.

Quality of A Product or Service

Amidst the fearsome price wars, many brands strive hard to provide quality. Yes, when you please your customer with unparalleled quality, price becomes a less-concerned issue.

Example. Chipotle has quickly gathered immense fame and climbed to the 14th spot in the list of top 50 fast-food franchises in the USA (ranking from QSR magazine). This quality-oriented brand has already captured a significant market share and causing trouble for “big boys.”

Innovation and Uniqueness

Many brands focus on providing innovation and uniqueness. If you can bring something new and fascinating, you can charge higher prices and people will pay for it happily.

Example. What would be a better example of innovation than Apple? The electronics industry’s juggernaut has captured a massive global market just because of its mind-blowing and surreal innovations.

Price of A Product or Service

When a brand is not enriched with innovation or superior quality, then pricing is an excellent option to challenge your competitors. Whether you accept or not, price is still one of the most critical factors that affect many consumers’ purchase decision.

Example. Dollar Shave Club has proved to be a nightmare for Gillette because they offer the cheapest razor cartridge refilling (20 cents) while Gillette was doing it for $2-$5. Due to this massive difference, Gillette has seen a decreasing market share.

Product Differentiation

Similar to innovation, product differentiation is another excellent marketing strategy to take the lead. A different product or service can easily kill the competition.

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Example. Tesla has revolutionized the automobile industry with its electronic cars. This has sidelined many economic cars such as Toyota Prius.

Customer Service

Customer services, if appropriately managed, can create a massive and defining image in consumers’ minds. In fact, this category is fundamental in specific industries such as banking and restaurants.

Example. Zappos, an American online shoe company, has unique customer service practices. They respond to every single email they get, even if the email is directly for the company’s CEO.

Niche Segregation

Targeting a micro-level market segment is another super-effective way of market positioning.

Example. Axe, also known as Lynx, is a famous British brand that focuses on male grooming products such as body sprays, deodorants, etc., for young males.

Advantages of Market Positioning

Market positing can help a brand in “countless” ways but here top five of them:

Increase in Revenue

Marketing positioning is purely dedicated to creating a unique image of any specific brand. When a brand succeeds in creating a unique market position, its revenue increases due to a boost in sales volume.

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Built A Competitive Edge

Market positioning also helps brands to create a competitive edge. Either you are following a pricing strategy or focusing on providing quality products or services, you develop a competitive advantage when you position your brand in the market. Everything your competitors don’t have is a competitive advantage, whether it is your offering’s price, uniqueness, or quality.

Easy to Promote A New Product

A company that has already positioned itself in the market can launch a new product and penetrate the market easily. This significantly reduces marketing costs as well.

Create A Brand Identity

Brand identity is highly dependent on market positioning. Only proper marketing positioning can develop an image or perception in a customer’s mind.

Marketing Positioning Simplifies the Purchase Decision for Customers

Customers want easy options and solutions while making a purchase decision. Positioning allows them to determine what kind of benefits they will get from a specific product or service. It ultimately simplifies their buying process.

How To Create A Successful Market Positioning Strategy

The market positioning strategy of any brand should be based on its core objectives. Companies should be clear as to how do they want their customers to perceive them. Here are some “must-do” practices to develop a thriving market positioning strategy.

Identify Your Strengths Through Competitor Analysis

Identifying the differences between you and your competitors is mandatory. This ultimately helps you to determine your strengths and how you can use them to take advantage of opportunities.

Analyze the Current Market Position

Before you decide to position yourself in the market, it is better to evaluate your current position. This will assist you in differentiating yourself from your competitors.

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Detailed Competitor Positioning Analysis

Apart from identifying your strengths, it is equally important to analyze your competitors’ strengths and how they can challenge you.

Create Your Market Positioning Strategy

Once you have examined the factors mentioned above thoroughly and understand your position, strength, and opportunities, develop your positioning strategy accordingly.

Positioning Errors That A Company Should Avoid

Excess of everything is bad, and the same is the case with market positioning. If a brand makes too many “promises” and claims to be the best, things may go south easily. So, here are some of the common mistakes marketers commit while developing positioning strategies:

  • Confused Positioning. Making too many claims and frequently changing the product features can make the customers confused about brand image.
  • Over Positioning. Over positioning means that a firm has gone way too specific in niche selection that only appeals to very few customers. It becomes challenging for a company to achieve its sales target with such a low number of potential customers.
  • Under Positioning. Under position, in simplest terms, means that a brand has failed to create a unique or differentiated image in customer’s mind. That said, the customer fails to differentiate a specific brand from others.
  • Doubtful Positioning. Doubtful positioning can be best described as “it’s too good to be true.” That said, it is a situation where customers become doubtful about the claims made by the brand because they look suspicious or unreal. This usually happens when a product’s price, physical features, etc., fail to match with the company’s claim.

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Examples of Market Positioning

Tesla

It will be an injustice if we don’t talk about Tesla as one of the best market positioning examples. The company has taken “price” out of the equation and only focuses on providing unparalleled quality to its customers. Tesla is more of a luxury brand, and its vehicles are:

  • Electric
  • Eco-friendly
  • Large-ranged

Nike

One of the best and globally admired brands, Nike has positioned itself in the market as an innovator with a high focus on performance. The waffle shoes from Nike have become the most expensive sneakers in the world. After bossing the “shoes” category, Nike is now offering performance-boosting sports attires.

HubSpot

The finest portrayal of “inbound marketing,” HubSpot developed a huge customer-oriented platform by offering helpful content to its readers. HubSpot is:

  • User-friendly
  • Customer-centric, and
  • Effective

Which makes it an automatic choice of many consumers around the globe. Apart from that, HubSpot has become an “all-in-one shop” that deals in:

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  • CRM
  • Marketing automation
  • Sales and service

Starbucks

It won’t be wrong to say that Starbucks has revived the tradition of coffee consumption in the USA. That is because the country had witnessed a decrease in coffee consumption since 1960. Starbucks, therefore, carefully targeted office workers who were interested in purchasing a high-quality product.

Coffee is considered as a soothing and relaxing beverage in the US, and Starbucks has always been vigilant to live up to the expectations.

FAQs

What is market positioning and examples? ›

Market positioning refers to the process of establishing the image or identity of a brand or product so that consumers perceive it in a certain way. For example, a car maker may position itself as a luxury status symbol. Whereas a battery maker may position its batteries as the most reliable and long-lasting.

What are the benefits of market positioning? ›

Marketing positioning allows companies to promote their brand in a way that allows them to distinguish themselves from competitors. If you're a marketing professional, learning about positioning can help you create a brand identity that resonates with customers.

What are 5 examples of markets? ›

The following are common examples.
  • Financial Markets. Large scale platforms of financial exchange such as stock, bond, derivatives, commodity and money markets.
  • Over-the-Counter. A market that is conducted by a dealer network. ...
  • Reinsurance. ...
  • Crowdfunding. ...
  • Farmer's Markets. ...
  • Wholesale Markets. ...
  • Trade Fairs. ...
  • Events.
12 Mar 2017

What are the 6 types of product positioning? ›

There are 8 types of product positioning based on different aspects of the product. These can be based upon; quality, variety, performance, efficiency, aesthetic, reliability, sustainability, and DIY.

What are the 7 positioning methods in marketing? ›

The seven basic types of positioning strategies are:
  • Product characteristics or consumer benefits. In using this strategy for positioning, the focus is on quality. ...
  • Pricing. ...
  • Use or application. ...
  • Product process. ...
  • Product class. ...
  • Cultural symbols. ...
  • Competitors (relation to)

What are the 6 positioning steps? ›

Steps of the Positioning Process
  • Confirm your understanding of market dynamics.
  • Identify your competitive advantages.
  • Choose competitive advantages that define your market “niche”
  • Define your positioning strategy.
  • Communicate and deliver on the positioning strategy.

How do you define positioning? ›

Definition: Positioning defines where your product (item or service) stands in relation to others offering similar products and services in the marketplace as well as the mind of the consumer. Description: A good positioning makes a product unique and makes the users consider using it as a distinct benefit to them.

What are the 5 benefits of market segmentation? ›

The major 5 benefits of market segmentation are Determining market opportunities, Adjustments in marketing appeals, Developing marketing programs, Designing a product, Media selection which is the major and the most important of them all.

What are the three types of market positioning? ›

There are three standard types of product positioning strategies brands should consider: comparative, differentiation, and segmentation. Through these strategies, brands can help their product stand out by targeting the right audiences with the best message.

What is step 4 in the positioning process? ›

Comparative Qualitative Analysis: The fourth step in the positioning process is to compare & analyses the data of competitors, qualitative customer inputs, external factors etc. On comparison, the gaps in the market can be understood.

What are the 4 C's of positioning? ›

What is it? The 4Cs (Clarity, Credibility, Consistency, Competitiveness) is most often used in marketing communications and was created by David Jobber and John Fahy in their book 'Foundations of Marketing' (2009).

What are the 4 main consumer markets? ›

There are four primary types of consumer markets, including:
  • Food and beverage. The food and beverage segment of the consumer market is expansive and includes every vendor that sells food and beverages directly to consumers. ...
  • Retail. ...
  • Consumer goods. ...
  • Transportation.

What is market explain? ›

Definition: A market is defined as the sum total of all the buyers and sellers in the area or region under consideration. The area may be the earth, or countries, regions, states, or cities. The value, cost and price of items traded are as per forces of supply and demand in a market.

What is a common market example? ›

A common market is an extension of the customs union concept, with the additional feature that it provides for the free movement of labour and capital among the members; an example was the Benelux common market until it was converted into an economic union in 1959.…

What are the 7 types of product? ›

Types of Product – Goods, Services, Experiences, Convenience, Shopping, Specialty Goods, Industrial Goods and Consumer Goods.

What is 5 box positioning tool? ›

Creating the positioning in a concise and focused way is key to maintaining the alignment between strategy and execution. The elements of the five-box tool (current belief, current do, desired belief, desired do, and customer proposition) isolate the key beliefs that drive customer behaviors and how to change them.

What are the 4 types of marketing strategies? ›

What are the 4Ps of marketing? (Marketing mix explained) The four Ps are product, price, place, and promotion. They are an example of a “marketing mix,” or the combined tools and methodologies used by marketers to achieve their marketing objectives. The 4 Ps were first formally conceptualized in 1960 by E.

What are the 5 C's of marketing? ›

The 5 C's stand for Company, Collaborators, Customers, Competitors, and Climate. These five categories help perform situational analysis in almost any situation, while also remaining straightforward, simple, and to the point.

What are the rules of positioning? ›

Five rules of successful marketing positioning
  • The mind ladder. A human mind has a limited amount of information immediately available. ...
  • Be the first. Being the first to bring a new product to the market is the best position possible. ...
  • Be second. ...
  • Pick a good name. ...
  • Avoid the extension line trap.
28 Feb 2018

What are the principles of positioning? ›

The Positioning Principles
  • Find an open hole. Thirty-six years ago marketing was considered to be communications. ...
  • Narrow your focus. Most brands are too broad in scope to fill a hole in the mind. ...
  • Name is foremost. ...
  • the visual hammer. ...
  • The verbal battlecry. ...
  • PR, not advertising.

What does marketing positioning mean? ›

Definition: Positioning defines where your product (item or service) stands in relation to others offering similar products and services in the marketplace as well as the mind of the consumer. Description: A good positioning makes a product unique and makes the users consider using it as a distinct benefit to them.

What is Coca Cola's positioning? ›

Coca-Cola Positioning Statement:

For individuals looking for high-quality beverages, Coca-Cola offers a wide range of the most refreshing options — each creates a positive experience for customers when they enjoy a Coca-Cola brand drink.

What is brand positioning with two examples? ›

A brand positioning statement is a description of your target market that also includes a holistic picture of how you'd like your brand to be perceived by customers (based on research and data). Simply put, this statement is the who, when, where, why, and how of your brand's identity.

What are the three types of market positioning? ›

There are three standard types of product positioning strategies brands should consider: comparative, differentiation, and segmentation. Through these strategies, brands can help their product stand out by targeting the right audiences with the best message.

What are the 7 positioning strategies? ›

The seven basic types of positioning strategies are:
  • Product characteristics or consumer benefits. In using this strategy for positioning, the focus is on quality. ...
  • Pricing. ...
  • Use or application. ...
  • Product process. ...
  • Product class. ...
  • Cultural symbols. ...
  • Competitors (relation to)

What are the 6 positioning steps? ›

Steps of the Positioning Process
  • Confirm your understanding of market dynamics.
  • Identify your competitive advantages.
  • Choose competitive advantages that define your market “niche”
  • Define your positioning strategy.
  • Communicate and deliver on the positioning strategy.

What is McDonald's positioning? ›

The term "positioning" refers to the process of selecting the marketing mix that is most suited to the target client group. McDonald's employs adaptive product positioning, which entails the corporation redefining products and services regularly in response to market developments.

What is Starbucks positioning strategy? ›

Positioning of Starbucks

The company's positioning strategy is customer-based, giving more than what the customer needs. Besides producing great coffee, it promotes a good reputation to its target market through excellent store ambiance, environmental protection, and social commitment.

What is Gucci positioning? ›

• Gucci's strategy to be the hottest brand is to promote inclusivity: appealing to everyone, rather than a specific gender. To that end, the Italian luxury house offers its customers more ready-to-wear to best capitalize on fashion trends.

What is brand example? ›

What Are Brand Examples? Although brands are generally intangible, we often associate things like products and names with brands. Examples include Apple, Nike, Coca-Cola, Advil, and Tylenol.

How many positioning are there? ›

There are three types of positioning strategies: comparative, differentiation, and segmentation.

What are the 4 positioning statements? ›

The Positioning Statement definition is comprised of 4 parts; the target, the category, the differentiator, and the payoff.

What are examples of positioning strategy? ›

A great positioning strategy example would be a computer company that focuses on providing cutting edge technology at premium costs before their competitors. Another example of positioning strategy would be a large chain store that focuses on providing popular goods to many people at a low cost.

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