🎯 Positioning in Marketing

Definition of positioning and the methods used to achieve it
Early examples and how the concept was framed by Ogilvy, Ries and Trout
Origins of the concept and the debate over who developed it
Positioning within marketing strategy (S-T-P) and the three types of positioning
The positioning statement template with the Volvo example
Positioning approaches and strategies
Perceptual mapping and the statistical procedures behind positioning analysis
Repositioning and how attitude models explain changing a brand's position

💡 Definition and Concept

In marketing, positioning is the mental perception of a product or brand by customers.

Brand and product positioning methods include:
- Product differentiation
- Advertising
- Market segmentation
- Business models such as the marketing mix
The concept was popularised by advertising executives Al Ries and Jack Trout.
It was further developed by academics Schaefer and Kuehlwein, who extended the concept to include the meaning carried by a brand.
Positioning is now a regular marketing activity and forms part of overarching marketing strategy theory.

David Ogilvy's View

Ogilvy wrote that "the most important decision is how to position your product".
He also wrote that "Every advertisement is part of the long-term investment in the personality of the brand."

Campaign	What Ogilvy said
Dove (launched 1957)	"I could have positioned Dove as a detergent bar for men with dirty hands, but chose instead to position it as a toilet bar for women with dry skin. This is still working 25 years later."
SAAB (launched 1961)	"In Norway, the SAAB car had no measurable profile. We positioned it as a car for winter. Three years later it was voted the best car for Norwegian winters."

Early Positioning Statements (1950s and 1960s)

Several large brands, including Lipton, Kraft, and Tide, developed positioning statements.
These statements guided how products would be packaged, promoted, and advertised according to consumer preferences.
This early tactic focused on the product itself: its "form, package size, and price", according to Ries and Trout.

Positioning as a Mental Device

In the 1969 article Industrial Marketing, Trout stated that the typical consumer is overwhelmed with unwanted advertising.
Consumers have a natural tendency to discard all information that does not immediately find an empty slot in their mind.
Hence, positioning is a mental device used by consumers to:
- simplify information inputs
- store new information in a logical place
In Positioning: The Battle for Your Mind, the duo expanded the definition:

Positioning is "an organized system for finding a window in the mind. It is based on the concept that communication can only take place at the right time and under the right circumstances".

📜 Origins

The precise origins of the positioning concept are unclear. Several accounts compete.

View	Key points
Ries and Trout	Often credited with developing the concept of product or brand positioning in the late 1960s through a series of articles, followed by a book
David Ogilvy	Credited by some scholars with developing it in the mid-1950s, at least a decade before Ries and Trout's articles; his writings show he was well aware of the concept and drilled his creative team with it from at least the 1950s
Early 20th-century agencies	Some scholars suggest a much earlier heritage in the work of advertising agencies in the US and the UK in the first decades of the twentieth century
Post-WWI advertising industry	Scholars suggest the concept may have emerged from the burgeoning advertising industry after World War I

Tacit Knowledge Before Codification

Cano (2003), Schwartzkopf (2008), and others argue that market segmentation and positioning were central to the tacit knowledge informing brand advertising from the 1920s.
However, these concepts did not become codified in marketing textbooks and journal articles until the 1950s and 60s.
Cano argues that practitioners followed competitor-based approaches to segmentation and positioning in the early twentieth century, long before the concepts entered the marketing literature.

Ries and Trout

Both were former advertising executives.
They published articles on positioning in Industrial Marketing (1969) and Advertising Age (1972).
By the early 1970s, positioning became a popular word with marketers, especially those in advertising and promotion.
In 1981 they published the classic book Positioning: The Battle for Your Mind (McGraw-Hill).
Their claim to have devised the concept has been challenged by marketing scholars. According to Stephen A. Fox, they "resurrected the concept and made it their trademark."
As advertising executives in their early careers, both were exposed to the concept through their work.
They codified the tacit knowledge available in the advertising industry.
They were influential in diffusing the concept from the advertising community to the broader marketing community.
Maggard notes that positioning provides planners with a valuable conceptual vehicle, which is effectively used to make various strategy techniques more meaningful and more productive.

Early Agencies and Brand Personality

Around 1920, the American agency J. Walter Thompson (JWT) began to focus on developing brand personality, brand image, and brand identity, concepts closely related to positioning.
The English agency W. S. Crawford's Ltd used the concepts of 'product personality' and the 'advertising idea'.
- It argued that to stimulate sales and create a 'buying habit', advertising had to 'build a definitive association of ideas round the goods'.

Example: Lux Soap

In 1915, JWT acquired the advertising account for Lux soap.
The traditional positioning was a product for woolen garments.
The agency suggested broadening it so consumers would see Lux as a soap for use on all fine fabrics in the household.
Lux was repositioned with a more up-market posture and began a long association with expensive clothing and high fashion.
Cano argues this strategy showed an insightful understanding of how consumers mentally construct brand images.
JWT recognized that advertising effectively manipulated socially shared symbols.
The brand disconnected from images of household drudgery and connected with images of leisure and fashion.

How the Concept Continues to Evolve

Traditionally called product positioning, the concept was limited by its focus on the product alone.
Positioning now also includes building a brand's reputation and competitive standing.
Many branding practitioners make positioning a part of brand strategy and label it "brand positioning".

🧭 Marketing Strategy

Positioning is part of a broader marketing strategy with three basic decision levels: segmentation, targeting and positioning, sometimes known as the S-T-P approach.

Level	Meaning
Segmentation	Dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers (known as segments)
Targeting	Selecting a segment or segments that will become the focus of special attention, known as target markets
Positioning	An overall strategy that "aims to make a brand occupy a distinct position, relative to competing brands, in the mind of the customer"

Three Broad Types of Positioning

Type	What it does
Functional	Resolves problems, provides benefits to customers, or gets favorable perception by stakeholders including lenders
Symbolic	Addresses self-image enhancement, ego identification, belongingness and social meaningfulness, and affective fulfillment
Experiential	Provides sensory and cognitive stimulation

Positioning Statement

A positioning statement includes:

Identification of the target market
The market need
The product name and category
The key benefit delivered
The basis of the product's differentiation from competing alternatives

Basic template:

For (target customer) who (statement of the need or opportunity), the (product name) is a (product category) that (statement of key benefit – that is, compelling reason to buy). Unlike (primary competitive alternative), our product (statement of primary differentiation).

Example: Volvo

Element	Volvo statement
Target customer	Upper income car buyers who currently own another brand and are looking to switch
Product strategy	Volvo is a differentiated brand of prestige automobiles
Key benefit	Offers the benefits of safety as well as prestige
Overall advertising strategy	Emphasize safety and performance and mention prestige as an entry ticket to the category, downplaying the previous family-car orientation in the interest of appealing to a broader range of users

🛠️ Approaches

To be successful in a market, a product must occupy an "explicit, distinct and proper place in the minds of all potential and existing consumers", relative to rival products with which the brand competes.
Product positioning encompasses:
- visibility
- recognition
- identity
- placement
Effective product positioning allows for more sales and larger margins.
A national positioning strategy can often be used, or modified slightly, as a tool to accommodate entering foreign markets.

Positioning Strategies Cited in the Literature

First-mover advantage
Pricing strategy, including marketing luxury goods and price discrimination
Product differentiation, including:
- Superlative positioning
- Exclusive positioning
- Competitive positioning
- Categorical positioning
Product marketing
Seasonal marketing
Diversity marketing

🗺️ Perceptual Mapping

To identify suitable positions a company or brand might occupy, analysts often use perceptual mapping or correspondence analysis.
Perceptual maps are diagrammatic representations of consumers' mental perceptions of the relative positions that various brands occupy within a category.

How a Perceptual Map Is Built

Select two variables relevant to consumers (often, but not necessarily, price and quality).
Ask a sample of the target market to place various brands in terms of those two variables.
Average the results across all respondents.
Plot the averages on a graph.

The graph shows how the "average" member of the population views the brands in a category and how each brand relates to the others.
Two-dimensional maps are common, but multidimensional maps are also used.
Key advantage: a perceptual map can identify gaps in the market that a firm may choose to "own."

Algorithms Used in Positioning Analysis

The following statistical procedures have been found useful:

Cluster analysis, including overlapping clustering
Correspondence analysis
Conjoint analysis
Multidimensional scaling, especially non-metric scaling (NMS)
Multivariate analysis

🔄 Repositioning

Why Positioning Fails

New market entrants
Changing customer preferences
Structural changes

Options for the Company

Strengthen the current positioning
Reposition the existing product or brand
Establish a new position within a new market or market segment

Repositioning involves a deliberate attempt to alter the way consumers view a product or brand.
It can be a high risk strategy, but sometimes there are few alternatives.

Attitude Models

Fishbein and Rosenberg's attitude models indicate that a business can influence and change a brand's positioning by manipulating factors that affect a consumer's attitude.
Research on attitudes suggests a brand's position in a prospective consumer's mind is likely determined by the "combined total of a number of product characteristics such as the price, quality, durability, reliability, colour, and flavour".
The consumer places important weights on each of these characteristics.
Using things such as promotional efforts, it may be possible to realign the weights of price, quality, durability, reliability, colour and flavour, which can then help adjust the position of a brand in the mind of the prospective consumer.

Positioning: Marketing Study Notes