Developing Your Market Positioning

In today’s Marketing Mondays post, we’re going to be looking at developing your market positioning.

You have a product (product, service, solution or brand). Now you need to know how to communicate its value to the market. This is where your market positioning comes in.

What is “Positioning”?
“Positioning starts with a product. A piece of merchandise, a service, a company, an institution, or even a person…But positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. That is, you position the product in the mind of the prospect.” — Al Ries and Jack Trout, authors of The Positioning Era Cometh articles that first appeared in AdvertisingAge in 1972 and the book: Positioning: The Battle for Your Mind.

“An internal articulation of the unique space you wish to capture in customers’ hearts and minds to influence their behavior” — from a MBA marketing management course.

More simply: positioning is WHO WE ARE and WHAT WE STAND FOR.

This positioning should inform and inspire all the communications related to the product. If done well, positioning can become a market-expanding insight that creates new revenue streams for a business. It can even turn around a faltering category — as I’ll show you in this post.

What is a Positioning Statement?
The positioning statement typically follows a standard formula:

For/To [target audience], [brand/product] is the [point of difference/value proposition] that [emotional and rational benefits], because/through [supporting statements/reasons to believe].

To bring this to life, below are some examples:

iPod: To creative dreamers, iPod is the cool MP3 player/fashion accessory that puts your music in your pocket and gives you the freedom to express your unique style because iPod provides wherever/whenever access to your music in a sleek, contemporary and compact design.

Snickers: For snackers, Snickers is the brand of candy bar that satisfies your hunger because it is packed with peanuts.

UNICEF: For people who want to make a lasting difference, UNICEF is the champion of rights for all the world’s children with the authority, knowledge and resources to get things done.

As you can see, the positioning statement is a singular statement that frames the product/brand in the customer’s mind, defining what is the product/brand’s value relative to the market.

I’ve included these more visually in the Slideshare here, so you can see them in building block format.

Crafting Your Foundational Positioning Statement
So, how do we get to our positioning statement?

I’d like to start at the top by providing a framework. In the past, I’ve called this “The 3 C’s”: (1) Customer, (2) Competition, (3) Company. At W2O Group, where I created the strategy practice, I trained the team with an “ABC” approach: Audience, Brand, Category. Regardless of how you label it, the approach is the same.

I like using this framework because it is broad enough to guide you across any industry, but focused enough to lead you to meaningful business insight. When I first started working in the healthcare space, my colleagues — some of whom had been in healthcare for 10 or even 20 years — wondered how I was going to bring new insight that they didn’t have from their years of experience. Well, it was through this framework. Like most people, marketers tend to focus on one or two industries and then fall back on psychological biases to make their decisions. For example, they’ll use information they learned about customers in previous work to inform future decisions without conducting new research focused on solving the current problem or question. Relying on psychological biases alone is just bad marketing, let alone, bad business. At best, this leads to mediocre, derivative solutions. And, we’re looking for new, breakthrough solutions. This is what the ABC framework guides you to. Let’s get started.

“A” is for Audience Truth
What we’re looking to answer here is what the audience’s (i.e. the customer’s) empathetic need. We derive this by answering the following questions:

1. Who is the audience (customer)?
2. What are the audience’s functional needs?
3. What are the audiences’s emotional needs?
4. What are the audience’s social needs?

Let’s break this down.

(1) Who is the audience (customer)? Your customer is not always who you think it may be. For example, I used to work with Cadillac. They asked me to help them amplify a new advertising campaign through social media. The campaign was a web series called “Cadillac Business Unusual”, where each episode told the story of a different entrepreneur and their atypical business. There was a great episode about a mom that had left an oppressive husband and culture somewhere in the middle east to come to America and create a better life for her kid. But, when she arrived in the U.S., she could not find an early care (kindergarten and pre-kindergarten) program that she felt comfortable with. So, she decided to start one herself. I developed a strategy to enroll some influential moms that were also entrepreneurs to share their own entrepreneurial journey, while highlighting, linking to and sharing the Cadillac Business Unusual episode. When I presented this strategy to the VP of marketing at Cadillac (who was a woman), she asked for a different approach. Why? Cadillac had made a strategic decision not to market to women. They wanted to be the car for the young, up-and-coming, American, (male) entrepreneur. They wanted to be a car that twenty-something and early thirty-something men aspire to. I was (almost) at a loss for words. I humbly explained that 85% of consumer purchase decisions are made by women — 65% of new car decisions are made by women. So, if you want young, successful men to buy a Cadillac, you need to market to the women that are influencing their car-buying decisions. That doesn’t have to mean explicitly marketing to women, but a minimum implicitly making a Cadillac the car you want your man to drive.

She didn’t agree. So, I tried a different argument.

As I recall, the video was about three minutes long, and at least the first minute was about this woman’s story, leaving her husband and country to make a better life for her kid in the U.S. “If you didn’t want to target females — moms — then why did you produce a video about a woman that became an entrepreneur because she’s a mom?” I asked. Furthermore, only 50% of audiences make it through a video that is 2 minutes or more in length, whereas 85% of audiences will make it through a video that is 30 seconds in length. Given this video was longer than 3 minutes, most audiences weren’t going to make it past the first minute — which was all about this woman being a great mom. I continued, “So, why not embrace this, and create some empathy and word-of-mouth with moms that are influencing their husbands’ car buying decisions or, even, buying Cadillac’s for themselves?” Alas, this VP could not be convinced to see the forest for the trees. But, that’s not the point of this anecdote. The point is that while we may create a product with a customer in mind, sometimes, new customers arise that you didn’t anticipate. Embrace this. After all, who thought that Cadillac and Tommy Hilfiger would become the go-to brands for rappers in the 1990's?

Once you’ve identified who your audience is, it’s time to figure out what drives their purchase decisions. People make decisions based on three factors: functional needs, emotional needs and social needs. Let’s use a current technology example here.

Why do people buy a Tesla Model S?

(2) What is the audience’s functional needs? Functionally, the customer needs to get to and from work everyday. The customer may need enough room to fit a couple of passengers from time to time, but not necessarily to cart around his kids all the time. Perhaps, he wants to save money on gas and time at the gas pump. These are the functional benefits of a car that can be met by any number of car brands and models.

(3) What are the audience’s emotional needs? But, decisions aren’t made based on functional requirements alone. The Tesla Model S customer likely wants a car with a beautiful, sleek design. Perhaps, they want a car that makes them feel successful, so they want a luxury model. Or, the customer wants a car that makes them feel free with sports car handling and acceleration. These emotional needs (coupled with the functional needs) narrow down the car brands and models that the customer might choose, such as a BMW 5 Series or Audi A6 or Mercedes E-Class Sedan. Perhaps they want a quiet car too, so the Lexus GS becomes an option.

(4) What are the audience’s social needs? The audience also may take social factors into consideration in their decision-making. The Tesla Model S customer may want to be perceived as innovative and progressive, so they want to own the latest, coolest gadgets — much like Apple customers with their devices. Perhaps the customer wants to do his part in cutting carbon emissions, and a fully electric vehicle like the Model S will go further here than a hybrid.

Answering questions 1–4 above, and synthesizing them down to one statement gives you an Audience Truth — a simple statement you know to be true about the customer.

A helpful way to get to this statement is by asking: “What job is the customer hiring your product to do?” For example, instead of asking, “How can we help consumers get floors and toilets clean?”, A.G. Lafley, former CEO of Procter & Gambel, used to ask, “How can we give consumers their Saturday mornings back?”¹ This is incredible insight. P&G customers want their Saturdays back. This is a market-expanding Audience Truth that can lead, not only to extraordinary communications of existing P&G products, but also to new product innovations.

“C” is for Category Truth
What we’re looking to answer here is what are the gaps that no competitors in the product category are filling? We derive this by answering the following questions:

1. What is your competitor’s positioning?
2. What does your competitor do?
3. How does your competitor do this?

Answer these questions for each of your competitors. I typically go to the competitor’s website and extract answers to these from the copy on their site. This can be tedious, but worth the exercise. By the time you’ve gone through all (or, at least, several) of your competitors, you’ll see how the competition tends to use the same jargon and generally position itself similarly. Being a bit of a contrarian, I find like this exercise because it gives me a way to answer the Audience Truth question in greater depth: “What job is the customer hiring your product to do because no other competitors are doing it?” This gap in the competitive category is your Category Truth.

“B” is for Brand Truth
What we’re looking to answer here is what unique value proposition does the product/brand provide that does the job the audience is hiring a product to do in a way that no other product in the category is doing. We derive this by answering the following questions:

1. What is the brand’s vision?
2. What does the brand/product do?
3. How does the brand/product do this? (functional/social benefits)
4. How does the brand/product make you feel? (emotional/social benefits)

Synthesizing the answers to these questions in a single statement gives you the Brand Truth.

Bringing It All Together
The positioning brings the insights from the Audience Truth, Category Truth and Brand Truth together into a simple, single statement: the foundational positioning statement that we reviewed above. Then, into an external facing statement that frames the product in the minds of the audience.

But, how does this come to life?

I’ll share one of my favorite examples, and it actually comes from turning around an existing brand: Puma.

Puma had lost relevance with the key youth market, so they hired an agency to turn things around. Through their research, the agency landed on the three truths:

Audience Truth. To Puma customers, life was a game, they were the after hours athlete. The target audience was highly competitive in everything they did. They loved whenever they got the opportunity to compete socially against their friends.

Category Truth. Sports advertising is dark, overcomplicated, technical, serious and painful (e.g. Nike ‘Just Do It.”).

Brand Truth. Puma creates sports clothes for everyday wear. They have never been too serious. They only sponsor athletes that have fun while competing (e.g. Pele, Maradona, Usain Bolt).

So, what’s the insight and positioning?

Positioning. Puma is the brand for the after hours athlete.

Simple. And, market expanding. Just watch this video case study and see.

Other great examples?

Apple’s “Think different.”

Johnnie Walker’s “Keep Walking.”

Both of these were brand turnarounds that reinvented the brand in the minds of customers. In fact, Johnnie Walker’s “Keep Walking” was so good that it not only turned around the Johnnie Walker brand, but also the entire scotch category, which had been loosing share in the whiskey and broader spirits market for years.

A recent example of positioning in a brand launch is Hewlett Packard Enterprise, which rolled out of Hewlett Packard last year. It’s new positioning and brand campaign: “Accelerating Next”, which is all about empowering and enabling businesses to create whatever their next innovation is.

Here’s an example of work we did in the healthcare space for The LAP-BAND™ System. This is another brand turnaround example, where The LAP-BAND™ System had been losing market share for years to other bariatric weight loss procedures. We repositioned the brand and developed a fully integrated campaign to reframe the product in audiences’ minds.

Foundational positioning statement. For obese individuals who want to lose 30 or more pounds with at least one obesity-related comorbidity, that are looking to find a customizable solution to their ever-challenging weight issue, The LAP-BAND™ System is the minimally invasive, safe and logical solution that acts as a platform for healthy, steady weight loss until the patient reaches their goal.

External positioning. “It Fits”

Case study video. Select here

When done well, positioning can be a powerful tool to focus your business, launch your product in the marketplace or even turn around a sleepy brand. Here you’ll find a Slideshare deck to guide you in creating your market positioning.

(This post originally appeared on The ReciprocityTheory.)

1. The Innovator’s DNA by Clayton Christensen, Jeff Dyer and Hal Gregersen