POSITIONING

POSITIONING
! All marketing strategy is built on STP
! If a company does an excellent job of
positioning, then it can work out the rest of
its marketing planning and dierentiation
from its positioning strategy.
POSITIONING - the act of designing the
companys oering and image to occupy a
distinctive place in the mind of the target
market.
POSITIONING = convincing reason for
customers to buy the product (Customer
Focused Value Proposition)
Company &
Product
Target Customers Benets Price Value Proposition
Volvo Station
wagon
Safety-conscious
upscale families
Durability
&
safety
20 %
premium
Safest
most durable wagon
your family
can ride
Dominos Pizza
Convenience Minded
Pizza Lovers
Delivery Speed
and Good Quality
10 %
premium
A good hot pizza,
delivered promptly at
your door at mid price
POSITIONING
! uecldlng on posluonlng requlres deLermlnlng
a frame of reference by ldenufylng LargeL
markeLs, compeuuon and ldenufylng Lhe ldeal
polnLs-of-parlLy and polnLs-of-dlerence
brand assoclauons.
COMPETITIVE FRAME OF REFERENCE -
which brands do you compete with
! Determine Category Membership product
substitutes Coke & Pepsi, BDO BPI and Metro
! Target market and Competition are key
determinants
! POPs and PODs
POD
! attributes or benets
consumers strongly associate
with a brand, positively
evaluate it and believe that
they cannot nd the same
extent with a competitive
brand.
3 Ds that can make Brand Association a POD
Desirability relevant -
Deliverability
Dierentiability distinctive and superior
Splenda vs. Equal

POP - assoclauons LhaL are noL necessarlly unlque
Lo Lhe brand buL may ln facL, be shared wlLh
oLher brands.

2 FORMS
CATEGORY POP - associations consumers view as
essential to be a legitimate and credible oering
within a certain product or service category.
COMPETITIVE POP - associations designed to negate
competitors points-of-dierence.
POD VS. POP
. 1o uchleve u olntofurlty on u urtlculur uttrlbute or beneft, u sumclent
number of consumers must belleve thut the brund ls "good enough' on
thut dlmenslon.
z. 1here ls u "zone' or "runge of tolerunce or uccetunce' wlth olntsof
urlty.
. 1he brund does not llterully huve to be seen us equul to cometltors, but
consumers must feel thut the brund does well enough on thut urtlculur
uttrlbute or beneft.
. vlth olntsofdlerences, the brund must demonstrute cleur suerlorlty.

MULTIPLE FRAMES OF REFERENCE - lL ls noL uncommon for
a brand Lo ldenufy more Lhan one acLual or poLenual compeuuve
frame of reference,


STARBUCKS
Quick-serve restaurants and convenience shops (McDonalds and
Dunkin' Donuts). Intended PODs might be quality, image, experience,
and variety; intended POPs might be convenience and value.
Supermarket brands for home consumption (Folgers and
NESCAF). Intended PODs might be quality, image, experience, variety,
and freshness; intended POPs might be convenience and value
ESTABLISHING CATEGORY MEMBERSHIP
! Marketers must inform consumers of a brands
category membership
! They know but they are not convinced
! They may also be aliated in categories they do not
have membership of
! WHAT TO DO: POSITION - inform consumers of a brands
membership before stating its point-of-dierence.
Communicating Category Membership
! Announcing category benets
! Comparing to exemplars
! Relying on the description of
the product.
CHOOSING POP AND POD
! POPs are driven by the needs of category membership (to
create category POPs) and the necessity of negating
competitors PODs (to create competitive POPs).
! Marketers must decide at which level(s) to anchor the
brands points-of-dierences.
! At the lowest level are the brand attributes.
! At the next level are the brands benets.
! At the top level are the brands values.
CREATING POP AND POD
! Many attributes or benets that make up the POP & POD
are negatively correlated.
! If consumers rate the brand highly on one particular
attribute or benet, they also rate it poorly on another
important attribute.
! Unfortunately, consumers typically want to maximize
both attributes and benets.
! The best approach is to develop a product and service
that performs well on both dimensions.
CREATING POP AND POD
POSITIONING STATEMENTS
To (target group and need) ,
our (Brand),
is (the concept)
that (what the POD is or does).
Boysen The Quality You Can Trust
Alaska Wala Padin Tatalo Sa!
Meralco May Liwanag ang Buhay
Mercury Drug Nakakasiguro, Gamot ay Laging Bago
LBC Hari ng Padala
Maxs Sarap to the Bones
Metrobank Youre In Good hands
Rebisco Sarap ng Filling Mo
Red Horse Beer Ito Ang Tama
UFC Catchup Tamis Anghang
Centrum Always Complete, From A to Zinc
DIFFERENTIATION STRAGEGY
! The obvious means of dierentiation, and often most
compelling ones to consumers, relate to aspects of the
product or service.
DIFFERENTIATION STRAGEGY
! Competitive advantage is a companys ability in one or
more ways that cannot match
! Customers must see any competitive advantage as a
customer advantage.
FORMS OF DIFFERENTIATION
! Personnel Dierentiation
! Better-trained people - strong
competitive advantage


FORMS OF DIFFERENTIATION
! Channel Dierentiation -Competitive advantage
through - design distribution channels coverage,
expertise & performance


FORMS OF DIFFERENTIATION
! Image Dierentiation- How the public perceives
the company or its products
! Identity - how a company aims to identify/position itself
or its product


PRODUCT LIFE CYCLE
! Products have a limited life.
! Product sales pass through
distinct stages, each posing
dierent challenges,
opportunities, and problems to
the seller.
! Prots rise and fall at dierent
stages of the product life cycle.


PLC Introductory Stage
! High Price but prots are negative or low
! Promotional expenditures are at the highest
! Inform potential consumers.
! Induce product trial.
! Secure distribution in retail outlets.
! Right time to introduce
! rewarding, but risky and expensive.
! Can come later if can bring superior technology, quality,
or brand strength.
PLC Introductory Stage
! Must innovate fast due to shortening PLCs
! Market pioneer gains the most advantage.
! Recall
! But not always the case


PLC Growth Stage
! Rapid climb in sales - Early adopters like the product, and
additional consumers start buying it.
! New competitors enter
! Price is the same or falls slightly
! Maintain promotional expenditures or at a slightly increased
level to meet competition and market education
! Sales rise much faster than promotional expenditures
making Prots increase.
! Manufacturing cost drops due to learning curve


PLC Growth Stage Strategies
! Improve product quality and add new features and improve
styling.
! Add new models
! Enter new market
! Increase distribution coverage and enter new distribution
channels.
! Shifts from product-awareness advertising to product-
preference advertising.
! Lower prices to attract the next layer of price-sensitive buyers


PLC Maturity Stage
! the rate of sales growth will slow down
! Normally lasts longer than the previous stages and poses big
challenges
! Industry Picture
! Many competitors whose objective is to gain or maintain
market share
! Dominating by few giant rms that serve the whole market
and make their prots mainly through high volume
! Surrounded multitude of market nichers


PLC Maturity Stage
! The maturity stage is divided into three phases:
! Growth, where the sales growth rate starts to decline
! Stable, where sales atten on a per capita basis because of
market saturation
! Decaying maturity, where the absolute level of sales starts
to decline, and customers begin switching to other
products


PLC Maturity Stage Strategy
! whether to become one of the big three or pursue a niching
strategy
! abandon weaker products and concentrate on products that
are more protable or on new products
! Market Modication - try to expand the market for its mature
brand by working with the factors that make up sales volume:
number of brand users or usage rate per user.


PLC Maturity Stage Strategy
! Product Modication modify product characteristics
! Quality improvement aims at increasing the
products functional performance (bigger, better)
! Feature improvement aims at adding new features
that expand the products performance, versatility,
safety, or convenience.
! Style improvement aims at increasing the products
aesthetic appeal


PLC Decline Stage
! Sales decline
! technological advances, shifts in consumer tastes, increased
domestic and foreign competition.
! Lead to overcapacity, increased price-cutting, and prot
erosion.
! As sales and prots decline, some rms withdraw from the
market.
! Those remaining may reduce the number of products they oer.


PLC Decline Stage
! Increase investment
! Maintain investment - uncertainty resolved
! Decrease investment selectively
! Milk investment - recover cash quickly
! Divest business quickly


WHAT IS YOUR
FAVOURITE
POSITION?