Positioning and Differentiation ofServices

Positioning is defined as the process ofestablishing and maintaining a distinctiveplace in the market for an organization andor its individual product offerings

Positioning strategy is the choice of targetmarket segments which determine where thebusiness competes and the choice ofdifferential advantage, which dictates how itcompetes

 

Positioning Strategies

Attribute positioning-based on attribute e.gAllahabad Bank positions itself as oldest bank

Benefit positioning e.g ICICI Bank with goodnumber of ATM’s and internet banking 

Use /application positioning-e.g SBI foreducational loans

User positioning-for e.g India as a destination forpilgrimage centres

Competitor positioning-Service is positionedagainst competitors e.g IIPM against IIMs

Category positioning- e.g Disney world asentertainment park

Quality/price positioning for e.g: Oberoi’s as highquality, high price hotels

 

Value Chain in Services

Organization needs to analyze costs relatedto each activity

Customer’s value chain to be evaluated i.ecompany’s product or service fitting incustomer’s value chain 

Obtaining cost advantages compared tocompetitors

Reducing costs or increasing performanceof customer

 

Differentiation

Differentiation to decide the number of benefitsand attributes from that of the competitors

The attributes for Differentiation are as follows:-

a) Important

b) Distinctive

c) Superior

d) Communicable

e) Preemptive-cannot be copied

f) Affordable

g) Profitable

 

Steps in Developing PositioningStrategy

Determining levels of positioning:-

a) Service level-LIC offering differentlife policies

b) Corporate level- LIC as Trustworthyand Reliable company

c) Category level-LIC as insurancecompany with various investmentoptions

 

Identification of Attributes Company should identify attributes offered by product class 

e.g:-Hotel offering free sauna bath

Customers considers specific uses offered by particularcompany e.g:-Insurance products offered for investmentoptions

Customers make decision on price of services in comparisonto perceived delivered value e.g Amount spend on MBA degreein comparison to package received after completion

Service’s ability to serve the needs of particular set of users e.g. Goa for fun loving youth

Service provider should provide rational and emotional benefits to customers e.g Customer’s preference for particularairlines for his liking of crew members

 

Location of Attributes onPositioning Map

Positioning maps can be developed foreach segment in target market and thesemaps will show the positions of differentplayers as per perceptions of customers insegments

The basis for positioning

a) Objective positioning- physical attributes ofproduct or service

b) Subjective positioning-customer’s image ofservice

or both

 

Evaluating Positioning Options

 Strengthening present positionsagainst competitors by providingefficient service

Identifying unoccupied market position

Repositioning the competitors e.g Airtelrepositioned from premium brand tomass brand

 

Implementing Position

Marketing Mix for implementation ofpositioning strategy:-

a) Service e.g Customer service provided atHilton Hotels

b) Price e.g Insurance companies havingdifferent policies with different pay outs

c) Location e.g On-line banking is moreattractive to busy traveler

d) Promotion e.g McDonald’s “ I am lovin it” e) People e.g Customer care executives are given

customer service trainingf) Processes e.g Banks can reposition service on

the basis of technology i.e Using Internetstressing on convenience of customers