Friday, April 23, 2010

How to Reach an Achievable Market Position for Your Brand

In this blog, we have defined positioning innovation and provided examples of how some products are currently positioned in the market.  So, for this post, I’d like to touch a bit on how marketers can successfully reach an “achievable market position” for their brand.

There are several steps involved with successful market positioning:

  1. Determine how your brand is currently perceived in the mind of your customer

  2. Achieve a new market position

  3. Communicate and deliver on the brand promise to your customer

Determining how your brand is currently perceived in the mind of your customer

When positioning a brand, marketers must understand not just the functional and emotional needs of customers, but also the context or situation in which the needs occur.  The combination of the context in which customers are trying to get a job done and personal/social factors shapes the customer’s “frame of reference.”  Research shows that not only do customers’ frames of reference influence perceptions of how well they get a job done, but also helps determine the parameters for the consideration set of brands from which a customer will select a solution.

For example, when shopping for a new vehicle, consumers who live in a place where they need to drive in snow and bad weather, do not want to worry that their car will not make it, and want to be perceived as “outdoorsy,” look for tough, dependable, all-wheel-drive types of vehicles.  This means, vehicles that are perceived as luxurious or up-scale (such as BMWs or Cadillacs) will likely not be considered.  On the other hand, brands such as Subaru or GMC have positioned themselves as optimal choices for customers with this frame of reference.  As such, visit any mountain town in the U.S. and you will likely find many more Subaru cars and GMC trucks than BMWs or Cadillacs.  That was exactly my observation when visiting Park City, UT, last month.

Most likely your customers already have a very specific perception of your company’s brand and what it can be relative to their frame of reference.  As a marketer, your job is to determine what this is, including the situation/context in which they are trying to get a job done, how satisfied they are in getting it done, and their feelings/perceptions as a result of doing the job.

To do this, you need to first gather and prioritize all the desired outcomes folks have when getting the job done for which your product has been hired and the emotional jobs they want to satisfy as a result.  By collecting the situation/context in which they execute the job, which solution they use, and their level of satisfaction, you will be able to ascertain along which dimensions and when your product is perceived to deliver superior vs. inferior results as compared to the competition.

After segmenting and profiling the market, you are now ready to begin positioning.  However, if you skip this step and try to position your brand too far from your customers’ frames of reference, you likely will confuse them and be unsuccessful in your positioning efforts.  In my next post, I will talk about achieving a new market position.  Stay tuned.

Tuesday, April 13, 2010

Apple's iPad to Follow the Path of the Palm Pre/Pixi

I finally was able to make it into an Apple store this weekend and get my hands on the Apple iPad to see if all the buzz about the device was warranted.  As a follow-up to my post about the iPad, I'd like to make a prediction.  I do not believe that the device will sell nearly as well as all the analysts predict

I say this despite the fact that it technically is great.  The screen resolution, responsiveness to the touch, and ease of use is really as good as people have been exhorting.  However, I cannot help to wonder what its positioning is in the mind of the customer.  In fact, as I stood in the Apple store playing with the iPad, a gentlemen came up to me and said, "Why do I need this?  Is it any better than what I have here?"  He was pointing to a MacBook he had tucked under his arm.  I responded by repeating some of the benefits I had heard, but ended the conversation thinking that perhaps he has a point.

As a precursor, the Wall Street Journal is reporting today that Palm is looking to sell itself.  Despite the fact that its new webOS has received very favorable reviews and hits on many of the unmet needs customers have while being mobile, the company has had a difficult time gaining sales.  I believe this is absolutely due to their lack of a valued position in the market.  RIM has unambiguously staked its claim for the BlackBerry as the device for mobile professionals who need to stay connected to the office and Apple has positioned the iPhone as the elegant, sophisticated multimedia and gaming hand-held.  Even Google has pushed Android as the open platform for the "techies."  What comes to mind when consumers think of the Palm Pre/Pixi?  Not much, that is the problem.

Back to the iPad.  As long as it is positioned as another hand-held device rather than a replacement for the computer, I don't think the masses will buy it in volumes.  Sure, the "innovators" and "early adopters" will get theirs.  However, I believe without a clear and credible point of distinction in the mind of the consumer, like Palm's Pre/Pixi, this product will struggle, at least by Apple's standards.  What do you think?

Thursday, April 8, 2010

Position Your Way to Growth

Innovation has been a buzzword in business circles for some time now.  When most people write or talk about innovation, they are focused on the process of developing new and improved products or services to better satisfy the needs of customers.  This, no doubt, is a good thing.  But, creating new things takes time, effort, and money.  So, no matter how well you understand customer needs, there is still a risk that the investment will not pay off.  However, another kind of innovation is possible that can dramatically improve growth, but requires a much lower up-front outlay.  I call this type of innovation "positioning innovation."

The basic approach to positioning innovation is not to create something new, but to change what is already in the mind of the customer.  That is, take what is existent and manipulate the perceptions and beliefs customers have about it.  The way to do this is through communication and messaging, as any brand strategist knows.  However, to be effective, it must resonate with the customer, not your ad agency, your marketing chief, or your boss.  In other words, it's all about how the customer receives your message and not what others believe about the sending of the message.

Dan Ariely, a professor of behavioral economics at Duke University, wrote in his book Predictably Irrational that "we not only tend to compare things with one another, but also tend to focus on comparing things that are easily comparable--and avoid comparing things that cannot be compared easily."  The implications of this for marketers trying to position their offerings in the market can be quite interesting.

Instead of simply looking at the competition and then deciding to demonstrate how your product is different or choosing to simply act as if the competitor's position did not exist, marketers must study how their product stacks up against the competition (especially market leaders) from the customers' perspective.  Then, they must determine against which products and along which dimensions to position their offering.  Choose incorrectly and you risk confusing the customer or not creating a distinct positioning for your company's brand.  In either of these cases, customers most likely will not choose to purchase what you have to offer.

On the flip side, if you position your company's offering against the competition along dimensions that are important to the customer and allow them to easily get how your product is unique, then the likelihood customers choose what you have to offer goes up dramatically.  All without making any changes to the product.

Thursday, April 1, 2010

Apple's iPad Positioning

With all of the hype and hoopla of Apple's upcoming iPad launch, I think it is timely to discuss its positioning in the market.  I am as excited as any gadget-lover to get my hands on one of these devices and see what it can do.  However, as a consumer, I can't help to wonder, "How am I supposed to perceive this new technical masterpiece Apple is pioneering?"

In the presentation Apple CEO Steve Jobs gave introducing the new product, he showed the iPad "positioned" between the iPhone/iPod Touch and the MacBook.  In doing this, Jobs is positioning the iPad based on form factor--it's bigger than a smart phone, but smaller than a laptop computer.  However, that may or may not be a valued position in the market.  To determine if it is, we need to look inside the mind of the customer.

A valued position is one that emphasizes jobs and/or desired outcomes that are important to the customer, that can be satisfied in a superior and sustainable manner by the company, and that provide a clear and credible point of distinction to customers.

What set of jobs will the iPad help people do or do better?  One answer to this question was proposed by Walt Mossberg in the WSJ.  Mossberg states, "If you're mainly a Web surfer, note-taker, social-networker and emailer, and a consumer of photos, videos, books, periodicals and music—this could be for you.  If you need to create or edit giant spreadsheets or long documents, or you have elaborate systems for organizing email, or need to perform video chats, the iPad isn't going to cut it as your go-to device."

Based on this article, Mossberg is making the statement that the iPad helps you get a set of jobs done around consuming content and not around creating content.  Apple appears to be thinking in a similar manner given that their launch ad displayed on their website shows someone consuming content. 

Let's get back to the devices Steve Jobs used to position the iPad in his presentation.  From a jobs-to-be-done perspective, a computer helps you both create and consume content while a smart phone helps you consume content and stay connected while being mobile.  Given the success of computers and smart phones in the market, we know that these sets of jobs are important to customers.  However, in positioning the iPad, is it sufficient to simply be the device that enables you to consume content?  Will that be compelling enough to mainstream consumers to purchase another device and drive Apple's sales?  The answer, of course, depends on whether or not it is perceived to be clearly superior to computers and smart phones for content consumption and distinct enough in the minds of customers as a go-to device while being on-the-go.  If not, Apple may need to rethink the iPad's positioning.