DifferentiationandProductPositioning
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Transcript of DifferentiationandProductPositioning
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Differentiation and
Product PositioningChat Session
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Differentiation and ProductPositioning
Take a position on one of the following:
Your political candidate for Election 2008 The War on Terror
Getting a college education
The brand of ketchup you buy
Child-rearing in the year 2008
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Differentiation and ProductPositioning
Now, jot down a few talking points
Outline that position
Then, think about the following: Is it different than another person who you may
have discussed this with? If so, how so andwhy?
If not, how could you make your positiondifferent? Make it stand out? Persuade peopleto take your side?
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Differentiation and ProductPositioning
Developing and communicating apositioning strategy Positioning is the act of designing the
companys offering and image to occupy adistinctive place in the mind of the targetmarket.What is a value proposition? Its a cogent reason
why the target market should buy the product.Examples? Think about the type of clothing you buy?
Whats the companys value proposition? Do you fitthe target market? Why? How?
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Differentiation and ProductPositioning
Four major positioning errors:
Underpositioning
Overpositioning
Confused positioning
Doubtful positioning
Note: when a customer has to ask: what do you
sell, manufacture, or what is it?its time to create aclear positioning plan.
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Differentiation and ProductPositioning
Positioning possibilities:
Attribute positioning (size, number of years inexistence)
Benefit positioning (the leader in a certain benefit) Use or application positioning (best to use)
User positioning (best for user group)
Competitor positioning (better than others)
Product category positioning (leader in certain productcategory)
Quality or price positioning (best value for the money)
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Differentiation and ProductPositioning
After youve determined this strategy, thenyou have to communicate the companyspositioning
A marketing plan should include a positioningstatement. TO (TARGET A GROUP OR NEED),OUR (BRAND) is (CONCEPT) THAT (POINT-OF-
DIFFERENCE).Examples
Write your statement for Exact
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Differentiation and ProductPositioning
Differentiation
What makes you different from your spouse orsiblings or friends or colleagues?
To differentiate is to set a meaningful and valueddifference to distinguish you (or a company) fromothers (or competitors).
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Differentiation and ProductPositioning
While all products can be differentaited to someextent, not all brand differences are meaningful orworthwhile. A difference is stronger to the extent
that it satisfies the following: Important
Distinctive
Superior
Pre-emptive
Affordable
Profitable
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Differentiation and ProductPositioning
Tools you can use in differentiation
Boston Consulting Group distinguishes fourtypes of industries based on the number of
competitive advantages and their size.
Volume industry
Stalemated industry
Fragmented industry Specialized industry
P.317 Kotler
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Differentiation and ProductPositioning
Key to competitive advantage is productdifferentiation Products variation by:
FormFeatures
Performance Quality
Conformance Quality
DurabilityReliability
Repairability
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Differentiation and ProductPositioning
Services differentiation by:
Ordering ease
Delivery
Installation
Customer training
Customer consulting
Maintenance and repair
Miscellaneous services
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Differentiation and ProductPositioning
Personnel differentiation
Better training people
6 characteristics
Competence
Credibility
Courtesy
Reliability
Responsiveness Communication
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Differentiation and ProductPositioning
Channel differentiation
How companys design their distributionchannels coverage, expertise and performance
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Differentiation and ProductPositioning
Image differentiation Buyers respond differently to company and
brand images
Identity is the way that a company aims to identifyor position itself or its product
Image is the way the public perceives the companyor its products Symbols, colors, slogans, special attributes
Physical plant
Events and sponsorships
Multiple image-building techniques
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Differentiation and ProductPositioning
Product life-cycle marketing strategies
Position and differentiation must change as thecompany and product life-cycle changes
Givens:Products have a limited life.
Product sales pass through distinct stages, posing differentchallenges, opportunities and problems for seller (think of ahouse).
Profits rise and fall at different stages of product life cycle.Products require different marketing, financial, manufacturing,
purchasing, and human resource strategies in each life-cyclestage.
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Differentiation and ProductPositioning
Product life cycle
Introduction: Slow sales growth as productdebuts
Growth: Rapid market acceptance andsubstantial profit improvement
Maturity: Slowdown in sales growth because
product as achieved acceptance Decline: Sales show a downward drift and
profits erode
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Differentiation and ProductPositioning
Style, fashion and fad life cycles
This is a special cycle
Style: basic and distinctive mode of expression
Fashion: currently acceptable; fashion pass through4 stages: distinctiveness, emulation, mass-fashion,decline
Fads: fashions that come quickly into public view,
are adopted with great zeal, peak early and declinefast
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Differentiation and ProductPositioning
Marketing strategies for each life cycle Introduction
Pioneer advantage
Growth
Early adopters; new competitiors Maturity
3 phases: growth, stable, decaying maturity Market modification
Product modification
Marketing-mix modification
Decline Some firm withdraw or die
Must find strong reasons for retention
Modifications for survival
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Differentiation and ProductPositioning
Market evolution
Stages in evolution
Emergence
Growth
Maturity
Decline