Service Positioning Steps for Businesses

Steps in Developing a Positioning Strategy

Service Positioning Meaning

The concept of service positioning came to prominence in 1972, following the series of articles written by Al Ries and Jack Trout titled “The positioned Era” for the trade publication Advertising Age. To demonstrate positioning success and failures they wrote a book titled “The Battle of Your Mind”.

Service positioning is the compelling rationale behind why individuals should choose to purchase a particular service. Positioning means projecting the image of the product or service in such a way that the consumer perceives its value distinctively from that of competitive offers. In other words, positioning aims to strategically shape and mould consumers’ perception of a product or service. The studies on consumer behaviour show that consumers do perceive against a marketing stimulation. Since marketing stimulations are many, a consumer may not respond selectively through a perceptual process.

According to Ries and Trout, “Positioning is defined as not ‘what you do to a product but rather what you do to the mind of the prospect you position the product in the mind of the prospect”.

Steps in Developing a Positioning Strategy

Following these steps is crucial when developing a positioning strategy for services.

Steps in Developing a Positioning Strategy
  1. Identify the Competitors
  2. Determine the perception and evaluation of competitors
  3. Determine the Competitors’ Positions
  4. Analyse the Customers
  5. Select the Position
  6. Monitor the Position

1) Identify the Competitors

We have already completed this step as a component of the direct marketing program plans, forming the foundation for a more in-depth analysis required to formulate a positioning strategy.

2) Determine the perception and evaluation of competitors

Knowledge of how competitors are perceived and evaluated rests upon two pieces of information:

i) What attributes or benefits do customers use to judge competitive products; and

ii) How satisfactory customers perceive each product to be on each attribute or benefit.

Identifying the essential attributes and benefits that matter to customers is challenging due to the multitude of available options. This determination requires marketing research, and most research texts have detailed discussions on identifying and evaluating the attributes that customers perceive to be important.

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3) Determine the Competitors’ Positions

Knowledge of how competitive products fare on important attributes or benefits is crucial for defining their positioning. Often, this involves mapping products onto dimensions that symbolize the crucial attributes or benefits. General marketers frequently employ perceptual mapping as a technique, which is equally applicable in comprehending competitive positions within a direct marketing context.

4) Analyse the Customers

Customer analysis requires determining what segments exist in a particular market. One way to approach the search for an unserved or under-served market segment is to look for a set of attributes or benefits that customers want, the firm can deliver, and its competitors cannot deliver. Once it is established that the firm’s product can deliver those attributes or benefits, the question becomes – Will customers believe that it can deliver? A competitive product failing to successfully deliver the attributes or benefits is an even more favourable scenario. Frequently a product will be able to establish a distinctive positioning simply by emphasising desired attributes or benefits that no other product has seen fit to emphasise. Remember, this crucial step in developing a positioning strategy is based on understanding what customers want, not what management thinks they want.

5) Select the Position

Assuming that the product or service has some flexibility in its positioning approach, how does the marketer select the position?

The best way is to think in terms of a perceptual map and look for “gaps” in product availability on one or more dimensions, Gaps indicate two possibilities:

i) No product is serving that particular need or set of needs, which means an opportunity exists.

ii) No one (or at least not a sufficiently large group of customers) has that particular set of needs, which means there is no opportunity.

Even if an opportunity exists, questions remain. Management must ask whether his company is capable of serving that particular segment of the market. Whether he have the skills and resources? Is his image appropriate (or can he make it so)?

6) Monitor the Position

Whether the task is to position a product, a service, or an organisation, the positioning strategy needs to permeate all aspects of the marketing effort.

The desired positioning will affect:

i) The creative execution, which must portray in both words and visuals the desired image.

ii) The structure of the offer and the implementation of its various elements.

iii) The types of customer services offered.

iv) The choice of media vehicles, both to reach the chosen target market and to provide an appropriate context for the product as positioned.

The degree to which the positioning of the product in the minds of the target market matches management’s desired positioning should be evaluated at regular intervals to ensure that the positioning remains appropriate to the needs of the target market as it changes and evolves. Marketing research, both qualitative and quantitative, is needed on a planned basis to oversee the positioning that has been achieved and to recommend adjustments in strategy or execution as needed.

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