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Positioning Strategy--Its Significant Contribution To Business

Another important factor that needs to be considered in every business-- aside from types of business strategies,how to write a strategic plan,strategic planning models-- is positioning strategy. Positioning is what the customer believes about your product's value, features, and benefits; it is a comparison to the other available alternatives offered by other competitors. These beliefs tend to be based on customer experiences and evidence, rather than awareness created by advertising or promotion.

Marketers manage product positioning by concentrating their marketing activities on a positioning strategy. Pricing, product promotion, channels for product distribution, and advertising--all are geared to optimize the chosen positioning techniques.

In general, there are six fundamental strategies for product positioning that every business should consider:

1. by attribute or benefit- this is the most frequently utilized positioning strategy. For example, a light beer, it might be that it tastes great or that it is less filling. For toothpaste, it might be the menthol taste, the whitening elements or tartar control.

2. By the use or application- the users of Apple computers can develop and use graphics more easily than with Windows or UNIX. Apple positions its computers based on how the computer will be used or its compatibility standards.

3. By user- Face book is a social networking site utilized exclusively by college students. Face book is too cool for My Space and serves a smaller, more sophisticated cohort. Only students may join with their campus e-mail IDs.

4. By product or service class- margarine competes as an effective substitute to butter. Margarine is positioned as a lower cost and healthier option to butter, while butter gives better taste and wholesome ingredients.

5. By competitor- BMW and Mercedes usually compare themselves to each other segmenting the market to just the creme de la creme of the automobile business arena. Ford and Chevy need not apply.

6. By price or quality- Tiffany and Costco both sell diamonds. Tiffany works for us to believe that their diamonds are of the prime quality, while Costco tells us that diamonds are diamonds and that only a chump will pay Tiffany prices.

Positioning strategy is what the customer believes and not what the provider wants them to believe. Positioning can change because of the counter measures taken at the competition. Managing your product positioning really needs that you know your customer and that you understand your competition; generally, this is the job of market research not just what the entrepreneur thinks is true.

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