Positioning Your Product

One of the more subtle areas of your marketing strategy is to position your product accurately. This is more of an art than a science, and is usually an iterative process, as you refine your positioning based on market feedback. Here are some basics:

What is Positioning

Wikipedia offers a nice concise definition of positioning: “A product’s position is how potential buyers see the product, and is expressed relative to the position of competitors.”

The marketing experts, Ries and Trout, state another definition: “any brand is valued by the perception it carries in the prospect or customer’s mind. Each brand has thus to be ‘Positioned’ in a particular class or segment.”

For example, you might have an information site that gathers useful information for consumers. How can you distinguish yourself from other sites? One way would be to highlight the fact that you have the best content for a particular group of consumers, for example, women, or new mothers. You would create this positioning in your marketing slogans and materials. This also has obvious impacts on your target market, and where you advertise.

A great example of positioning was the original launch of Facebook, which restricted membership to people who attended prestigious Ivy League universities. The positioning created success and also a sense of exclusiveness, which creates tremendous customer loyalty.

Positioning and Target Market

These two terms are intertwined. Your positioning must resonate with the target market. For example, if you are targeting to retired people (on the content example) then positioning your site as the number one site for new mothers would not be very effective. A more effective position would be to focus on the accuracy of your information, or how trustworthy your site is, which are terms that retired people would be apt to resonate with.

Pricing indirectly affects positioning. Some sites are positioned as ‘high-end’ and are targeted at high-end consumers. As you price your product, you are indirectly creating a positioning statement. Conversely, if you lower your price, your high-end consumers might be turned off.

Spartina Principles

We believe the most effective principle a start up is to start narrow. In the Facebook example, they were very narrow in the beginning. As the site caught on, the membership criteria expanded. By then, however, success was already in motion.

This also demonstrates a second principle: use an iterative process in positioning your product. Start by understanding your competitors and identifying an unoccupied slot, then put yourself there and see what happens. As you follow the progress of your company, you will learn more about your target audience, and either broaden or narrow your position depending on market feedback.

Benefits of Accurate Positioning

Getting positioning right can help you make better decisions about your product and your business. For example, Hulu positions itself as the site to find and watch the world’s premium content. In light of that, even if they don’t receive money from a network, they will still include the content, as a way of insuring their content matches their positioning.