POSITIONING

In a highly competitive environment there is a risk that the customers may perceive most of the services as being alike with little difference. They may thus make their choice based on price. Positioning strategy therefore is aimed at creating and maintaining a distinctive difference that will be noticed and valued by the customers with whom the company would like to develop long term relationship. For successful positioning you have to understand

Target customers preferences

Competitors offerings

DIFFERENTIATION

DIFFERENTIATION APPROACHES FOR EFFECTIVE POSITIONING Product Differentiation Personnel Differentiation Features Competence Performance Courtesey Conformance Credibility Durability Reliability Reliability Communication Style Image Differentiation Symbols Written , audio/visual media Atmosphere Events Service Differentiation Delivery (Speed, Accuracy) Installation Customer Training Consulting Services Repairs

POSITIONING

contd/-SEGMENTATION Segmentation is a process by which a large heterogeneous market is divided into smaller homogenous groups each having distinct characteristics

FOR SEGMENTATION TO BE EFFECTIVE IT MUST BE I) MEASURABLE THE SIZE, PURCHASING POWER, DEFINING CHARACTERISTICS

II) SUBSTANTIALTHE SEGMENT MUST BE SUBSTANTIALLY LARGE AND PROFITABLE III) ACCESSIBLEIT MUST BE EASY FOR THE CO TO REACH AND SERVICE THE SEGMENT

POSITIONING
(SEGMENTATION)

contd/--

DIFFERENTIABLETHE SEGMENT MUST BE DISTINCT

CONCEPTUALLY AND MUST RESPOND DIFFERENTLY TO DIFFERENT MARKETING INPUTS

ACTIONABLETHE SEGMENT SHOULD BE SUCH THAT VARIOUS

MEASURES CONTEMPLATED BY THE CO SHOULD BE POSSIBLE

ETHICAL CHOICESTHE COS MUST ADHERE TO

BASIC ETHICS WHEN ADDRESSING TO CERTAIN VULNERABLE GROUPS

SEGMENT INTERRELATIONSHIPS
THE COS MUST STUDY THE COST PERFORMANCE ETC

POSITIONING
(TARGETING)

contd/--

SEGMENTATION IS A PRELUDE TO TARGETING

TARGETING IS A PROCESS BY WHICH COS DECIDE WHICH SEGMENT TO ENTER

A CO MAY ENTER MORE THAN ONE SEGMENT

TARGETING IS DONE BY EVALUATION OF SEVERAL VARIABLES OF VARIOUS SEGMENTS IE SALES/PROFITS ETC

POSITIONING contd/-ROLE OF RESEARCH At this stage it is necessary to decide what attribute of a given service do the customers prefer and how well do customers perceive it in competing brands. This is generally conducted through market research. It should be borne in mind that the same set of people may choose different attributes depending upon The purpose of the service Who makes the decision The timing The individual is using the service alone/in a group Composition of the group

STAGE I Identify key offer attributes

Tangible, colour size

Intangible-reputation, guarantees, service features

STAGE 2 Draw perceptual Map

Head-On/Me Too STAGE 3 Decide On Competitive strategy Position Away/Avoid Competition Less Profitable On growth

STAGE 4 Design offer attributes, imageries

USP

STAGE 5 Sustain competitive advantage

STEP II PERCEPTUAL MAP

High Prices Sheetal Boutique Shoppers Stop Globus CrossRoads/ Pyramid WestSide

Pantaloons

Wide Range

Marks & Spencer

Babubhai Jagjivan Das
Big Bazar

Low Range

Fashion Street Low Prices

Apna Bazar

POSITIONING DECISION

I) HEAD ON POSITIONING II) AVOID COMPETITION

HEAD ON POSITIONING Here the market is crowded and you have to compete with several playerbut you see the possibility of profits if you do well If intensity of rivalry increases, margins are likely to get squeezed Price war may start

AVOIDING COMPETITION This is certainly a very tempting route but there is a trap here. The market may be very limited with low growth. If the position demands high service with low price the business will not be sustainable If the position has high price with low service, bad word of mouth service will drive you out of business.

High Price

Competitive

SHEET TBZ

Failure

Nordstorm

Low Service

High Service

Financial Failure Fashion Street

Low Price

DIFFERENTIATING THE PRODUCT

After positioning your product, you have to give it certain features that differentiate it from the competitors.

CitibankUnfixed Deposits SBIMagnum

Global trust Bankstate of the art Hutch---emotional Bonding

ICICIdistribution Network

HOSPITALS Apollo/Hinduja/Govtdifferent price levels

SUSTAINING THE ADVANTAGE

Companys self-perception
Company
Cos perception of comp Customers perception of Co

Comp perception of co

Cos perception of customers

Customer Competitor
Customers perception of themselves

Competitors perception of themselves

RE-POSITIONING

Sometimes cos have to make significant change in the existing position This is known as Re-positioning

This could revising service standards, vacating a segment and entering a new segment.
There may be legal/ethical issues. Improving negative brand perceptions may involve re-positioning.

CONCLUSION

Ultimately, positioning involves a strategic manipulation of the firms market mix variables: product, price, promotion, physical facilities, people and processes. Each of these marketing mix variable is controllable. When effectively combined, the marketing mix can off-set the effects of the uncontrollable factors that exist in every companys operating environment such as technological advances ,consumer needs,new and existing competitors, governmental regulations, economic conditions and effects of seasonality, which are constantly changing the environment in which a firm operates.