5 steps of market positioning
It’s easy as 1×1
If you just start your business, market positioning is one of the first steps you have to do. If your company already exists, you should do your market positioning now to: capture larger audience and articulate a clear marketing message.
Let’s see how to do it quickly and easily:
1. Determine current position
Determining your existing market position is the first step to know where your company is as a brand. If you want to compete with the competitors out there, you must understand your own market. Answer the following questions:
- Who are you as a brand and what do you stand for?
- Who are your target customers and what do they need?
- How will you meet their needs?
- Who are your competitors and what do you do differently?
Find out and analyze your competitors is one of the most important element in market positioning. If you are too similar to your competitor, the customer won’t know which to choose, and might choose your competitor over you.
Address these questions for yourself and write the answers down so they can be referenced or revisited later.
2. Develop a unique positioning idea
Once you identified your market, you have to create a unique impression that associates something specific that your potential customers need, and it’s different from your competitors.
With all this information in hand, you should be able to clearly and specifically state who you are as a brand, who you are not, what problems exist in the market, and how you can solve those problems.
3. Competitor analysis
Research your competitors will help you determine the strength and weaknesses in your own business, as well as see what works and what doesn’t. Understanding the differences between a business and its competitors is essential to finding gaps in the market that can be filled.
Some of the data you’ll need is easy to find. Some will take time and effort to gather and analyze.
Some categories you have to consider when identifying your competitors:.
- Competitor Goals
- Competitor Strategy
4. Competitor positioning analysis
Michael Porter of Harvard Business School:
- Supplier Power
How easy is it for suppliers to raise prices? If you sell low cost products, or you are in a discounted industry, it’s pretty difficult to increase prices, but it’s doable. It’s all about how you differentiate yourself from your competitors.
- Buyer Power
How easy is it for buyers to push prices down?
- Competitive Rivalry
How many competitors exist in the market? The more competitors there are offering similar products or services, the less attractive the market is.
- Threat of Substitution
How many similar products exist in the market? Where a large number of similar products exists, it’s pretty difficult to sell on higher prices, because there is probably a cheaper source somewhere nearby.
- Threat of New Entry
How profitable is the market? More profitable markets attract new competitors.
5. Identify your uniqueness
Now do the same market research as you did in the first step, but do it with your own brand, not with competitors. Hold the two data sets up for comparison.
It should become pretty evident where your market positioning strategy should strengthen your brand, and attract new customers.
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