What’s it: Product positioning is about placing the product in consumers’ eyes and among other products on the market. It is essential to influence customer perceptions of the value of a product.
For example, Apple positions the iPhone as a premium smartphone with high quality. The company influences consumer perceptions with its innovation while differentiating it from other products in the mass market, likewise with Nike, a shoe brand with high price and quality.
Next, a positioning statement describes target consumers, how to satisfy them, and do it differently (better) than competitors.
To create a position map, you can depict the products on the market on a two-dimensional chart. You analyze consumer perceptions of two characteristics of each competing product group. For example, you might use price and battery life for smartphone products. Or, you choose the design and features as selected variables.
Why product positioning matters
Business exists to meet consumer needs profitably. They must find a solution to get consumers to like the product and be satisfied. All at once, they can beat their competitors. Because of this, they have to develop product positioning. It is important for several reasons:
First, companies become more focused on their competitive strategy and resource allocation. To find the right position, they look for product attributes that can satisfy customers, whether about price, quality, or product performance. Then, they try to differentiate their product from competitors’ products in the market. That way, customers have a compelling reason to prefer their products over competitors’ products.
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