Product positioning is how you present your product to your audience to give them a specific impression. It is a strategy that motivates your target market to engage with your brand and eventually purchase your product. Proper product positioning also allows you to stand out from the (increasingly tough) competition.
Key Takeaways:
- Product positioning differentiates your products, driving sales and building customer loyalty.
- Competitor analysis, messaging, and the right channels are the components of product positioning.
- You can take several approaches to product positioning depending on your target market’s needs.
Importance of Product Positioning
Product positioning in marketing essentially differentiates your products from competing products and brands. According to recent research, product positioning helps brands gain a competitive advantage. Differentiation is increasingly important as more and more competing brands and products emerge online.
Product positioning can also help establish your brand as an authority or expert in your niche. Consumers trust experts, so this can also build brand loyalty in your products as a result.
According to Product Marketing Alliance, product positioning and messaging continues to be the top responsibility in terms of product marketing for practitioners.
At the end of the day, an effective product positioning strategy can drive more customers and more sales.
While product positioning crafts a unique identity for a specific product, brand positioning encompasses the brand’s story and values. Learn how to position your brand by creating a brand positioning statement.
Types of Product Positioning
The type of product positioning you use will depend on your target customer, their needs, and the specific aspect of the product you want to emphasize.
- Quality or prestige positioning: This type of positioning highlights the product’s quality as its main selling point, suggesting that its higher quality or status differentiates it from other products. For example, consumers may seek out a luxury bag specifically because it’s made by a well-known brand.
- Price positioning: Positioning products based on price means emphasizing that the product is offered at a lower or more competitive cost than others on the market. Think grocery stores—you’ll likely see products from different brands competing based on cost savings.
- Benefit positioning: With benefit product positioning, your messaging focuses on the benefits your customers can gain from your products or services. Cosmetics are a common example.
- Feature positioning: This type of product positioning hinges on standout features that differentiate your product from competitors. Electronics and gadgets frequently use this type of positioning.
- Competitive positioning: With competitive positioning, you are either directly or indirectly demonstrating that your product is better than competitors. This is more common among larger brands.
How to Position Your Product Step by Step
Now let’s take a look at how to go about your product positioning approach.
Step 1: Understand Your Audience
The first step is knowing who you’re targeting with your messaging and promotions. Knowing who the product is for is critical. Analyze the needs, preferences, and demographics of your potential customers. This involves both qualitative and quantitative market research, through customer surveys, data collection, market research and reports, social media listening, SEO trends, and more.
You can take this information and divide your audience into specific segments based on characteristics like age, gender, income level, lifestyle, etc. Then, create a detailed customer persona or ideal customer profile to guide your positioning strategy.
Your customer persona should contain important information, behavior, pain points, objectives, and strategies.
Make sure to focus on your audience’s current perceptions and beliefs about your industry, products, and competitors through this process.
Step 2: Do a Competitive Analysis
A competitive analysis will help you understand the current landscape and see where your product fits in. When analyzing your competitors, consider things like:
- Which marketing and sales channels they use
- Customer ratings and reviews
- Where they’re located
- Product prices
- Messaging approaches
- Targeting strategies
- What people are saying about them on social media and elsewhere online
- Their search presence
- Their product catalog
- Who they’re targeting
Note what works and what doesn’t work. You might even conduct a full-on strengths, weaknesses, opportunities, and threats (SWOT) analysis for each of your biggest competitors.
Look for gaps or unique angles in the market your product can fill and lean into that. This will come in handy in the next step.
Step 3: Identify Key Differentiators
Now it’s time to understand what makes your product different from the rest—your key differentiators. These are the unique selling points (USPs) that distinguish your product from competitors’ products. Differentiators could include quality, features, pricing, or brand reputation, for example.
Don’t be shy here! Come up with an exhaustive list of everything unique or superior about your product. You can refine this list when creating content and marketing promotions.
Step 4: Write a Positioning Statement
Now you have the information you need to write your product positioning statement. This is a short statement that succinctly defines your product’s value proposition for your target audience.
A positioning statement typically includes the following:
- Product category or industry
- Target customer
- Unique benefits
- Reasons to believe the product’s claims
Here’s an example of a product positioning statement from the Kickstarter page for Smart Bedding: “Finally, bedding that solves the problem of bunching sheets and making your bed.” It highlights how these sheets are different from regular sheets because they don’t bunch up and help ease the burden of making your bed.
Step 5: Develop Key Messaging
Now it’s time to expand upon your product positioning statement. Your messaging should reinforce your positioning statement across various channels, including your website, advertising, and social media. Tailor your messaging to address your audience’s pain points, needs, and desires.
When it comes to messaging, it’s important to stay consistent. Document your messaging guidelines in a brand voice and product positioning document so your internal team members can align with the overall strategy.
Step 6: Choose the Right Channels
Determine which channels will effectively reach your target audience. For example, younger audiences might be more active on social media platforms like Instagram and TikTok while professionals may prefer LinkedIn or email marketing.
Remember to tailor your content and communication style to each channel—but stay consistent with your messaging and positioning.
Step 7: Evaluate and Refine Your Positioning
Like most things in today’s data-driven business world, it’s important to regularly evaluate your positioning strategy.
Gather feedback from customers and monitor how they respond to your messaging and product through surveys, reviews, and social media. Adjust your approach based on market changes, customer feedback, and competitor movements when necessary.
Examples of Great Product Positioning
Let’s take a look at some additional examples of effective product positioning to help inspire your own:
Anderson Valley Brewing Company
Independent craft beer breweries serve as excellent examples of product positioning. They often have several distinct beers, each brewed for a specific palate, and often each with its own positioning.
Anderson Valley Brewing Company is a prime example of this in action. Take its four “new classics” for example:
Its Black Light beer is promoted as “full flavor” and “low calorie” while the Coastal Ale is described as “a delicious way to help safeguard the world’s oceans, beaches, and waves.” The Black Light beer appears to be positioned for calorie-conscious beer lovers while the Coastal Ale appears to be targeted towards environmentally conscious beer drinkers.
Peloton
Peloton changed the home fitness scene with its exercise bike. Now, the brand has an expanded product collection including the original, modified visions of the original, treadmills, and even a row machine.
When it emerged on the scene, Peloton’s product positioning was very synonymous with its brand positioning. That’s because it launched with one core offering. However, the brand has expanded over time, adding to its product catalog—necessitating individual product positioning strategies for each.
Here’s how Peloton differentiates the Bike+ from the original Bike, for example:
“Peloton Bike: The original motivating cardio machine loved by millions.”
“Peloton Bike+: Our most advanced Bike with a larger rotating screen, auto-resistance, and more.”
Product positioning is not only important for differentiating your product from competitors but also from other products in your store.
Rolex
Rolex is somewhat of a hybrid between brand positioning and product positioning—the brand only offers one product, watches, but it offers several different versions of that product.
Regardless of how you look at it, Rolex has positioned its products to be the high-quality, luxury option above the rest.
The brand writes on its website of its latest collection: “Offering unique harmonies of materials, colours and textures, the 2024 watches illustrate our desire to constantly reawaken watchmaking emotions, while demonstrating uncompromising quality down to the smallest detail. Thanks to our in-house mastery of watchmaking expertise, the new watches play with contrasts to achieve a harmonious balance of functionality and aesthetics, performance and preciousness, tradition and innovation.”
Here’s what its positioning strategy appears to be from the outside looking in:
- Product category or industry: Luxury watches
- Target customer: Style-conscious consumers who appreciate quality accessories
- Unique benefits: High-quality, timeless style, best materials, functional yet fashionable
- Reasons to believe the product’s claims: Watches are made in-house, top watchmaker since 1905
Frequently Asked Questions (FAQs)
These are some of the most common questions we see about product positioning.
The primary goal of product positioning is to create a unique and positive impression of a product in the minds of a specific target audience. This helps differentiate the product from competitors, build brand loyalty, and make it easier for customers to understand its unique value.
A positioning strategy is the approach a brand uses to define how its product is perceived within the market. It involves choosing specific qualities or benefits to highlight, such as price, quality, or a niche audience, to appeal to the target customers and stand out from competitors.
Positioning is done through these steps:
- Research: Understand the market, target audience, and competitors.
- Analyze the competition: Do a competitive analysis to see the state of the market.
- Identify differentiators: Define what makes the product unique.
- Write a positioning statement: Summarize the product’s unique value.
- Develop and broadcast messaging: Convey the positioning across all channels.
- Monitor and adjust: Gather feedback and refine the positioning as needed.
Bottom Line
Effective product positioning is essential for small businesses that want to stand out and attract loyal customers. By clearly defining and communicating what makes your product unique, you can create a memorable impression that resonates with your target audience, encourages engagement, and ultimately drives sales.
Positioning isn’t just about differentiating from competitors—it’s about building trust, conveying value, and aligning with customer needs. With a strong positioning strategy, you can adapt to market challenges, highlight your strengths, and build a lasting connection with your customers.
