The Sunday Mail
Entrepreneurship Matters
Dr Kudzanai Vere
The desire to start and operate one’s own business has risen among many people and there has been encouragement through articles, presentations and forums.
Getting into some form of business and establishing something is not a big issue. The biggest and most determining question is the HOW part. It is on the how part that most people get or lose it in life and in business. How you have positioned yourself in that particular market has a bearing on where you are going and how far you will go?
The market is just a jungle where your entry strategy and how you finally position yourself must be strategic.
As a business, you have a product or a service that you are bringing to the market and what matters is how your product or service compares with others and how you are going to dispatch it. Strategic positioning, therefore, spells out how you are doing to distinguish your products from those of competitors and there are a number of ways of doing so which I will share in this article.
Understanding
strategic positioning
“Positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. That is, you position the product in the mind of the prospect.” — Ries & Trout.
Strategic positioning focuses on how an organisation defines itself in the market. It speaks into the way it sets itself apart from competitors in delivering its products and services to the market.
Successful businesses initially focus on how they plan to position themselves in the minds of their customers; how they are and should be perceived in the market and what the message that your actions or inactions are sending to people out there.
Having a great product is not enough to ensure the success of a company. You can be defeated by companies selling inferior products, but which have successfully positioned themselves in the market and in the minds of customers.
A positioning strategy is, therefore, a type of marketing strategy that focuses on distinguishing a brand from its competitors. The goal of a positioning strategy is to influence consumer perception by effectively communicating a brand’s competitive advantage.
You will realise that there might be every need now and then to reposition your brand. A successful positioning strategy leaves everyone in the market with the organisation or product’s story. Without communicating a company’s value proposition through a set of marketing strategies, businesses cannot maintain their competitive edge, innovate, grow, or build brand awareness.
Keys of strategic positioning
Successful positioning hinges on a company’s understanding of the market and its target audience. I will share components that make up an effective positioning strategy.
Customer
Every successful positioning strategy must have a firm grasp on the target market and customer needs. Knowing your target demographic will help guide decision making when developing marketing plans. This understanding is crucial for ensuring that you are using the correct pricing strategy to maximise profitability.
Channel
Your channel is how customers interact with your brand. Depending on your business model, your channel may be your sales team or your marketing team. Use market research to collect metrics on consumer desires and behaviours, then leverage this information to best connect with your customer.
Competition
Evaluate your market position relative to your direct competitors. A positioning map (also known as a perceptual map) helps visualise where your company stands in customers’ minds and can be a key tool for informing your overall business strategy.
Positioning strategies that
you can implement
- Positioning based on
product characteristics
Using product characteristics and benefits as a positioning strategy associates your brand with a particular feature beneficial to customers. This is powerful as customers will relate to your product based on the quality of benefits attached and associated with that particular product.
We have companies like Econet Zimbabwe which are so innovative in proffering solutions in the telecoms business and they have been known for that. In the automobile industry, Toyota’s position in the market is reliability, Porsche’s position is performance and Volvo’s position is safety.
What do you want to be known for as an organisation? These are the positioning questions that you must ask yourself as you come up with your strategies. Brands consistently communicate a unique benefit or characteristic of the product with consumers.
- Positioning based on price
Positioning your products or services on price is competitive pricing. Usually, with a pricing positioning strategy, a brand aims to be the cheapest in the market and value becomes their position.
This is often called pricing strategy. Pricing strategy defines the way businesses use price to position themselves in their competitive landscape. Pricing strategy includes qualitative and quantitative evaluation of the different factors that go into setting a price for the product or service. By approaching pricing from a strategic perspective, companies do not only define how much their products and services cost, but position themselves relative to their competition. In addition to the quantitative nature of pricing, companies should pay attention to how pricing affects some of the more qualitative features of the business.
- Positioning based on
quality or luxury
Often the price and quality of a product align, certainly in the consumer’s mind, as the high price is often associated with high quality. However, positioning a product based on its high quality is different from positioning based on price. Often these brands do not communicate their price point; instead, high quality or prestige is the focal point of communication to create a desire, so customers want the product regardless of the price.
- Positioning based on
the competition
Competitor-based positioning focuses on using the competition as a reference point for differentiation.
Brands highlight a key difference their product/service offers in their marketing to make it seem favourable and unique compared to other marketplace options. The product or service becomes unique. However, brands can use the competition as a reference point to follow a similar strategy. Successful strategic positioning gives your organisation or brand a competitive edge above your rivals in the same market. This is one aspect that calls for attention for it has a bearing on organisational growth and sustainability.
The writer, Dr Kudzanai Vere, is the founder and CEO of Kudfort Zimbabwe.
