Positioning is what the customer believes about the value, features and benefits of your product; it is a comparison with the other available alternatives offered by the competition. These beliefs tend to be based on customer experiences and evidence, rather than awareness created by advertising or promotion.
Marketers manage product positioning by focusing their marketing activities on a positioning strategy. The price, the promotion, the distribution channels and the advertising are all oriented to maximize the chosen positioning strategy.
Generally, there are six basic strategies for product positioning:
1. By attribute or benefit: this is the most used positioning strategy. In the case of a light beer, it might taste good or fill less. For toothpaste, it could be mint flavor or tartar control.
2. By use or application: Apple computer users can design and use graphics more easily than with Windows or UNIX. Apple positions its computers based on how the computer will be used.
3. By user: Facebook is a social networking site used exclusively by college students. Facebook is too cool for MySpace and serves a smaller, more sophisticated cohort. Only college students can participate with their campus email IDs.
4. By class of product or service: margarine competes as an alternative to butter. Margarine is positioned as a healthier and lower-cost alternative to butter, while butter provides a better flavor and healthy ingredients.
5. By Competitor: BMW and Mercedes are often compared to each other and segment the market as the crème de la crème of the automobile market. Ford and Chevy do not need to apply.
6. By price or quality: Tiffany and Costco sell diamonds. Tiffany wants us to believe that their diamonds are of the highest quality, while Costco tells us that diamonds are diamonds and only a fool will pay Tiffany prices.
Positioning is what the customer believes and not what the supplier wants you to believe. Positioning may change due to countermeasures taken in competition. Managing the positioning of your product requires that you know your customer and understand your competition; In general, this is the job of market research, not just what the entrepreneur believes to be true.