MM3 Lecture Midterms (1) PDF

MM3 CHAPTER 6: BRAND POSITIONING AND REPOSITIONING PRODUCT POSITIONING STRATEGIES Again, brand positioning is the process of creating a unique im...

MM3 CHAPTER 6: BRAND POSITIONING AND REPOSITIONING PRODUCT POSITIONING STRATEGIES Again, brand positioning is the process of creating a unique image or identity for a brand to distinguish it from competing brands. Successful companies communicate clearly, specifically, BRAND POSITIONING and thoroughly how they are different and how that difference makes an impact on the What happens when every company in the same industry says the same thing about its customer's life. Brand positioning is closely related to market segmentation because it focuses products? Customers don't know how to tell the difference between one product and another, on the relevant wants and needs of the brand's target market(s). The ultimate goal of positioning so they are likely to make their decision based on price. When this occurs, the customer may not for any company is to encourage consumers to choose its brand over competing brands. To get the product that best fits his or her needs, and companies fail to maximize sales. While there accomplish this goal, companies use advertising and other promotional techniques to is a segment of the market that is best served by low prices, this 'is not always the most effective communicate the brand's image. There are various product positioning strategies used by way to attract customers. companies. 1. Competitor Positioning WHAT IS BRAND POSITIONING? Competitor positioning focuses on the differences between a company’s product and well- Brand positioning has been defined by Kotler as “the act of designing the company’s offering known competing products. Therefore, with this positioning strategy, a company takes aim and image to occupy a distinctive place in the mind of the target market”. In other words, brand at one or several competitors to demonstrate its superiority among others offering the same positioning describes how a brand is different from its competitors and where, or how, it sits in type of product or service. customers’ minds. A brand positioning strategy therefore involves creating brand associations in customers’ minds to make them perceive the brand in a specific way. By shaping consumer preferences, brand positioning strategies are directly linked to consumer loyalty, consumer-based brand equity and the willingness to purchase the brand. Effective brand positioning can be referred as the extent to which a brand is perceived as favorable, different and credible in consumers’ minds. For example: A Smartphone manufacturer may position its smartphone as luxury status symbol like iPhone A TV maker may position its TV as the most innovative and cutting-edge like LG A fast-food restaurant chain may position itself as the provider of cheap meals such as Jollibee 2. Price and Quality Positioning A handbag maker may position itself as a luxury status symbol like Louis Vuitton Companies may use price or quality characteristics to position their brands. Price positioning emphasizes low or competitive prices. There are two ways to approach Behind any brand positioning statement or tagline is the intention on how a company desires a value or price positioning, both of which are crucially dependent on quality. One business to be represented to customers. Once the real role of positioning is understood, having approach is to use a high-end tack, which exploits the psychological belief that the a tagline or a positioning statement can be useful by clarifying a brand's essence within an more expensive something is, the more intrinsically valuable it must be. You can also organization. position your brand as the provider of high-quality, value-priced products or services Brand positioning is a process that enables the marketer to know what their company should do 3. Differentiation Positioning to market its product or service to its customers. With positioning, the marketer determines the In some product categories, a firm can identify consumer segments that are under- image for the product based on its intended audience. This is done using the price, the product, served or highly receptive to innovation. Differentiation positioning is the pursuit of these where it is sold, and what promotions are used. Good brand positioning allows the marketing new buyers by introducing features or functions distinctive from competition. team to convert an interest in a product to a sale. For example: Manufacturer of Colgate Tooth Paste may communicate the customers POSITIONING STATEMENTS VERSUS TAGLINES that their product protects the users from gum problem, solves their respiratory problems, Brand positioning statements are often confused with company taglines or slogans. Positioning and, helps to keep the teeth strong. While other tooth paste product positioning their statements are for internal use. These statements guide the marketing and operating decisions products differently. of your business. A positioning statement helps you make key decisions that affect your customer’s perception of your brand. A tag line is an external statement used in your marketing efforts. Insights from your positioning statement can be turned into a tagline, but it is important to distinguish between the two. 4. Away from a Competitor Positioning 7. User Positioning Positioning your brand as the opposite of your competitor can help you get attention in User positioning associates a product with a group of consumers and their lifestyle. Some a market dominated by some other product. A memorable example of this positioning of the manufacturers and sellers may be dealing in certain specialized products, which strategy is Avis Rental Cars’ We’re #2. We try harder. Another example of away from a are used by particular market segments only. In such a circumstance, they try to competitor positioning is 7UP’s “The Uncola” campaign from the 1970s. Instead of going communicate to the specific user category only. head to head with the dominant products in their category - Coke and Pepsi - 7UP defined a new niche. 8. Positioning against another product Some manufacturers may communicate to their customers that their products are more qualitative or better than those of competitors. For example, product ‘A’ is better than product ‘B’, and so on. Most of the manufacturers who have knowledge about marketing do not offer this type of positioning to its customers because this sort of positioning strategy may damage company’s image instead of building. BRAND REPOSITIONING Brand/Market repositioning is when a company changes its existing brand or product status in the marketplace. Repositioning is usually done due to declining performance or major shifts in 5. Benefit Positioning the environment. The most common brand positioning strategy is benefit positioning, which involves selecting one or more attributes (features) or benefits that are important to consumers Repositioning a brand or product means altering its place in the minds of the consumer, or and are the basis for making purchasing decisions. This strategy focuses on a benefit essentially changing the brand’s or product’s image or identity. When you are repositioning, or your product provides to your target audience. Most of the companies mention some trying to change the consumers’ perception of a brand or product after it has already been benefits which can be obtained by the customers if they use their products. solidified, may confuse or alienate consumers in the target market. For example, Coca-Cola Zero uses benefit positioning to emphasize its full flavor with For example, if a premium luxury car maker suddenly slashed the prices of its vehicles and began zero calories—two attributes that appeal to health- conscious consumers. Attributes and selling them at the same prices as cheaper brand-name vehicles, consumers would no longer benefits are closely related to consumer needs. Positioning attempts to show consumers perceive the vehicles made by the luxury car maker as prestigious status symbols, even though how a brand's attributes or benefits are capable of solving the consumers' problems. the car features may remain unchanged. Another example, kids and teens height problem – Star margarine positioned itself as Many companies, instead of repositioning, choose to launch a new product or brand because height builder margarine. of the high cost and effort required to successfully reposition a brand or product. 6. Usage or Application Positioning A brand may be positioned on how it is used. Manufacturer of certain products, usually medicines, use certain information such as, use two or three times daily, for therapeutic use only, store in a cool place, ‘use before meal’, ‘use after meal, or use at bed time, etc. This information may help the customers to gain knowledge about how to use, when to use, and how much to use.