DifferentiationandProductPositioning

7/28/2019 DifferentiationandProductPositioning

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Differentiation and

Product PositioningChat Session


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Differentiation and ProductPositioning

Take a position on one of the following:

Your political candidate for Election 2008 The War on Terror

Getting a college education

The brand of ketchup you buy

Child-rearing in the year 2008


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Now, jot down a few talking points

Outline that position

Then, think about the following: Is it different than another person who you may

have discussed this with? If so, how so andwhy?

If not, how could you make your positiondifferent? Make it stand out? Persuade peopleto take your side?


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Developing and communicating apositioning strategy Positioning is the act of designing the

companys offering and image to occupy adistinctive place in the mind of the targetmarket.What is a value proposition? Its a cogent reason

why the target market should buy the product.Examples? Think about the type of clothing you buy?

Whats the companys value proposition? Do you fitthe target market? Why? How?


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Four major positioning errors:

Underpositioning

Overpositioning

Confused positioning

Doubtful positioning

Note: when a customer has to ask: what do you

sell, manufacture, or what is it?its time to create aclear positioning plan.


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Positioning possibilities:

Attribute positioning (size, number of years inexistence)

Benefit positioning (the leader in a certain benefit) Use or application positioning (best to use)

User positioning (best for user group)

Competitor positioning (better than others)

Product category positioning (leader in certain productcategory)

Quality or price positioning (best value for the money)


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After youve determined this strategy, thenyou have to communicate the companyspositioning

A marketing plan should include a positioningstatement. TO (TARGET A GROUP OR NEED),OUR (BRAND) is (CONCEPT) THAT (POINT-OF-

DIFFERENCE).Examples

Write your statement for Exact


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Differentiation

What makes you different from your spouse orsiblings or friends or colleagues?

To differentiate is to set a meaningful and valueddifference to distinguish you (or a company) fromothers (or competitors).


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While all products can be differentaited to someextent, not all brand differences are meaningful orworthwhile. A difference is stronger to the extent

that it satisfies the following: Important

Distinctive

Superior

Pre-emptive

Affordable

Profitable


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Tools you can use in differentiation

Boston Consulting Group distinguishes fourtypes of industries based on the number of

competitive advantages and their size.

Volume industry

Stalemated industry

Fragmented industry Specialized industry

P.317 Kotler


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Key to competitive advantage is productdifferentiation Products variation by:

FormFeatures

Performance Quality

Conformance Quality

DurabilityReliability

Repairability


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Services differentiation by:

Ordering ease

Delivery

Installation

Customer training

Customer consulting

Maintenance and repair

Miscellaneous services


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Personnel differentiation

Better training people

6 characteristics

Competence

Credibility

Courtesy

Reliability

Responsiveness Communication


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Channel differentiation

How companys design their distributionchannels coverage, expertise and performance


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Image differentiation Buyers respond differently to company and

brand images

Identity is the way that a company aims to identifyor position itself or its product

Image is the way the public perceives the companyor its products Symbols, colors, slogans, special attributes

Physical plant

Events and sponsorships

Multiple image-building techniques


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Product life-cycle marketing strategies

Position and differentiation must change as thecompany and product life-cycle changes

Givens:Products have a limited life.

Product sales pass through distinct stages, posing differentchallenges, opportunities and problems for seller (think of ahouse).

Profits rise and fall at different stages of product life cycle.Products require different marketing, financial, manufacturing,

purchasing, and human resource strategies in each life-cyclestage.


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Product life cycle

Introduction: Slow sales growth as productdebuts

Growth: Rapid market acceptance andsubstantial profit improvement

Maturity: Slowdown in sales growth because

product as achieved acceptance Decline: Sales show a downward drift and

profits erode


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Style, fashion and fad life cycles

This is a special cycle

Style: basic and distinctive mode of expression

Fashion: currently acceptable; fashion pass through4 stages: distinctiveness, emulation, mass-fashion,decline

Fads: fashions that come quickly into public view,

are adopted with great zeal, peak early and declinefast


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Marketing strategies for each life cycle Introduction

Pioneer advantage

Growth

Early adopters; new competitiors Maturity

3 phases: growth, stable, decaying maturity Market modification

Product modification

Marketing-mix modification

Decline Some firm withdraw or die

Must find strong reasons for retention

Modifications for survival


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Market evolution

Stages in evolution

Emergence

Growth

Maturity

Decline

Documents

DifferentiationandProductPositioning