What is Repositioning?

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What is repositioning?

Repositioning involves making a significant shift in how a brand or product is perceived by its target market. It is a strategic decision to alter the positioning of a product to better align with changing market conditions, consumer preferences, or competitive landscapes. Successful repositioning requires the firm to reshape the target market’s understanding of the product, which can be particularly challenging for well-established or strongly branded products with entrenched perceptions.

Why Repositioning is Necessary

Firms may decide to reposition a product for several reasons:

  1. Declining Performance: When sales, market share, or brand relevance begin to decline, repositioning may be necessary to revitalize the brand and make it more appealing to the target market. For instance, an outdated brand image may no longer resonate with current consumer preferences.
  2. Shifts in Market Dynamics: Major changes in the market environment—such as new competitors, evolving consumer preferences, or technological advancements—can necessitate repositioning to maintain relevance and competitiveness.
  3. Expanding Market Appeal: A brand may choose to reposition to target a new demographic or broaden its appeal to additional market segments. For example, a niche product might reposition itself to attract a mainstream audience.
  4. Crisis or Negative Public Perception: In cases where a brand’s reputation has been damaged, repositioning can help rebuild trust and reestablish a positive image.
  5. Changes in Product Offerings: If a product has undergone significant innovation or improvement, repositioning can communicate these new benefits and redefine its competitive edge.

Challenges of Repositioning

Repositioning is not without risks and challenges, especially for well-established brands:

  • Consumer Resistance: Long-time customers may struggle to adapt to the new positioning or feel alienated if the repositioning moves away from the brand’s original identity.
  • Cost and Effort: Repositioning often requires substantial investment in marketing, advertising, and possibly product redesign or packaging changes.
  • Competitive Pushback: Competitors may respond aggressively to a repositioning attempt, particularly if it threatens their market share.
  • Internal Alignment: Ensuring that all aspects of the business (e.g., marketing, operations, product development) align with the new positioning can be complex and time-consuming.

Examples of Repositioning

  1. Old Spice: Originally positioned as a brand for older men, Old Spice successfully repositioned itself as a trendy, youthful brand through humorous and engaging advertising campaigns. This repositioning revitalized the brand and attracted a younger demographic.
  2. Domino’s Pizza: Faced with declining customer satisfaction and negative reviews, Domino’s repositioned itself by improving its pizza recipe and emphasizing transparency in its marketing. The “We Changed Everything” campaign successfully reshaped consumer perceptions and drove growth.
  3. Apple: In the late 1990s, Apple repositioned itself from being a niche brand for tech enthusiasts to a mainstream, design-forward innovator with products like the iMac and later the iPhone. The “Think Different” campaign played a pivotal role in redefining its brand image.

Repositioning vs. Launching a New Product

In some cases, firms may opt to launch a new product or brand rather than reposition an existing one. This decision depends on factors like the strength of the existing brand, the costs associated with repositioning, and the potential for alienating existing customers. Repositioning is often chosen when:

  • The brand has strong equity that can be leveraged in the new positioning.
  • The market environment suggests that adapting the existing brand will be more cost-effective than starting from scratch.
  • The firm wants to retain loyal customers while attracting new ones.

Key Considerations for Successful Repositioning

  1. Market Research: Understanding the target market’s needs and preferences is critical to crafting a positioning strategy that resonates.
  2. Clear Messaging: The repositioning message must be simple, consistent, and communicated effectively across all channels.
  3. Alignment Across the Marketing Mix: All elements of the marketing mix (product, price, place, promotion) must support the new positioning.
  4. Gradual Transition: For well-established brands, a gradual repositioning strategy may help ease consumers into the new identity without alienating loyal customers.

Repositioning can breathe new life into a struggling brand or capitalize on emerging opportunities, but it requires careful planning, execution, and a willingness to adapt to new challenges.

Definition of repositioning

Elsewhere in this study guide, we have summarized the definition of positioning as:

  •  Positioning is the target market’s perception of the product’s key benefits and features, relative to the offerings of competitive products.

Therefore, in definition terms, repositioning is “implementing a major change” in the perception of the product, resulting is the relatively similar definition of:

  • Repositioning is the task of implementing a major change the target market’s perception of the product’s key benefits and features, relative to the offerings of competitive products.

This view of repositioning as being a change of the established product positioning is reinforced by the following two quotes:

  • “Sometimes, marketers feel the need to change the present position of the brand to make it more meaningful to the target segment. This change in position, and finding a new position for the brand, is called brand repositioning.” (Vashisht, 2005).

Both definitions carry the word ‘change’ as the key issue. The first definition, however, suggests that repositioning is focused upon the same target market. But, as will be discussed, a product can be repositioned in order to appeal to a wider or different target market.

Why Reposition a Brand?

Brands and products are often repositioned to address challenges in the market or to capitalize on new opportunities. Repositioning can help a firm stay relevant, compete effectively, and align its offerings with evolving consumer needs or strategic goals. Here are detailed reasons why firms might choose to reposition a brand:

1. Decline Stage of the Product Life Cycle (PLC)

As products or brands move into the decline stage of the PLC, sales and profitability tend to decrease due to market saturation, changing consumer preferences, or the emergence of newer alternatives. Repositioning in this stage can help:

  • Revitalize the brand by targeting new uses, benefits, or audiences.
  • Extend the product’s life cycle by aligning it with current market trends or consumer needs.
    Example: Baking soda was traditionally used for cooking but was repositioned as a cleaning and deodorizing product, extending its relevance and market appeal.

2. Declining Sales or Profit Margins Due to Competitor Positioning

A brand that is positioned too closely to a major competitor may struggle to differentiate itself, resulting in price wars or reduced profitability. Repositioning helps:

  • Create a unique identity that avoids direct competition.
  • Highlight distinct features, benefits, or emotional appeals that resonate more strongly with target consumers.
    Example: Pepsi’s “Choice of a New Generation” campaign differentiated it from Coca-Cola by appealing to younger, trend-conscious consumers.

3. Introduction of a Superior Product by the Same Company

When a company introduces a new product that offers superior features or benefits, it may need to reposition an existing product to prevent internal competition or cannibalization. Repositioning can:

  • Clarify the roles of different products within the portfolio.
  • Target new segments or uses for the older product.
    Example: When Apple launched the iPhone, it repositioned the iPod as a niche product for music enthusiasts rather than a general consumer gadget.

4. Supporting an Overall Strategic Change

Sometimes, repositioning is part of a broader organizational strategy, such as shifting from a product-centric to a customer-centric approach or expanding into new markets. Repositioning helps:

  • Align the brand with the company’s long-term goals and values.
  • Signal a fresh direction to consumers, investors, and stakeholders.
    Example: Starbucks repositioned itself from being just a coffee chain to a “third place” between home and work, emphasizing community and experience.

5. Entering New Markets or Pursuing New Segments

When expanding into new geographic regions or targeting different consumer demographics, a brand may need to reposition to better align with the preferences and cultural values of the new audience. This involves:

  • Adjusting messaging to resonate with local needs.
  • Highlighting benefits or features relevant to the new market.
    Example: McDonald’s repositioned its offerings in India by introducing a vegetarian menu tailored to local dietary preferences while maintaining its global brand identity.

6. The Brand/Product is Classified as a “Dog” in the BCG Matrix

Brands or products categorized as “dogs” in the Boston Consulting Group (BCG) matrix have low market share in low-growth markets, making them less profitable. Repositioning can:

  • Shift consumer perceptions to increase market share or demand.
  • Highlight niche uses or benefits to maintain profitability in a smaller, loyal market.
    Example: Campbell’s Soup repositioned itself as a convenient and healthy meal option rather than just a pantry staple to revive sales in a stagnant market.

Other Reasons for Repositioning

  • Responding to Negative Public Perception: If a brand has suffered damage to its reputation, repositioning can help rebuild trust and reestablish credibility.
  • Leveraging Market Trends: Capitalizing on emerging trends (e.g., sustainability, health consciousness, or digital innovation) can help reposition a brand as forward-thinking and relevant.
  • Creating Emotional Appeal: A brand initially positioned on functional benefits may be repositioned to focus on emotional connections, broadening its appeal.

Repositioning is a strategic tool that allows firms to adapt to changing circumstances, reinvigorate their brand, and maintain competitiveness in dynamic markets. While challenging, it can yield significant rewards when executed effectively.

How Will Repositioning a Brand Be Helpful?

Repositioning is a strategic tool that allows firms to address specific challenges and capitalize on new opportunities. It is primarily aimed at improving sales, profitability, and aligning the brand with evolving market dynamics or strategic goals. Let’s explore how repositioning can deliver tangible benefits in various scenarios.

1. Extending the Life Cycle in the Decline Stage

In the decline stage of the product life cycle (PLC), repositioning can revitalize a brand or product by identifying new uses or markets.

  • How it helps: It creates relevance for the product by aligning it with emerging consumer needs or alternative applications.
  • Example: Vinegar, traditionally positioned as a food product, was successfully repositioned as a safe and effective household cleaner. This repositioning opened a new market segment and extended its utility.

2. Reducing Head-to-Head Competition

When a brand is positioned too closely to a major competitor, it often struggles with “shared” sales, price wars, and promotional discounting. Repositioning allows the brand to carve out a unique identity and reduce direct competition.

  • How it helps: It increases differentiation, enabling the brand to target a distinct consumer base and achieve greater price stability and profitability.
  • Example: Pepsi’s repositioning with the “Choice of a New Generation” campaign helped it differentiate from Coca-Cola by appealing to a younger, trend-conscious demographic.

3. Mitigating Cannibalization from New Product Introductions

In markets where technology drives frequent innovation, introducing superior products can lead to cannibalization of the company’s existing offerings. Repositioning older products can create complementary roles within the portfolio.

  • How it helps: It maximizes overall sales by aligning different products with distinct target segments or use cases.
  • Example: When Apple launched the iPhone, it repositioned the iPod as a specialized music device for audiophiles, preventing significant cannibalization and expanding overall sales.

4. Aligning with New Strategic Directions

A company may reposition a brand to reflect a broader strategic shift, such as modernizing its image, highlighting innovation, or emphasizing convenience.

  • How it helps: Repositioning enhances the brand’s relevance in the eyes of its target market, aligning it with the firm’s long-term vision and values.
  • Example: Traditional banks like ING have repositioned themselves as digital-first, modern banks, focusing on convenience and online functionality to attract tech-savvy customers.

5. Facilitating Market Expansion

Traditional positioning may limit a brand’s ability to grow in new markets where its original messaging or appeal may not resonate. Repositioning helps tailor the brand to different cultural, demographic, or regional contexts.

  • How it helps: It unlocks new growth opportunities by making the brand relatable and desirable to diverse audiences.
  • Example: McDonald’s introduced vegetarian and culturally sensitive menu options in India, repositioning itself as inclusive and locally relevant.

6. Revitalizing a “Dog” in the BCG Matrix

Brands or Strategic Business Units (SBUs) classified as “dogs” in the Boston Consulting Group (BCG) matrix often face limited prospects due to low market share in stagnant markets. Repositioning can breathe new life into such brands.

  • How it helps: By targeting niche markets, emphasizing new benefits, or tapping into emerging trends, repositioning can create fresh growth opportunities.
  • Example: Campbell’s Soup repositioned itself as a convenient, healthy meal option rather than a basic pantry staple, revitalizing its appeal in a competitive market.

Broader Benefits of Repositioning

  1. Improved Brand Perception: Repositioning can help a brand stay relevant and modern, enhancing its reputation and appeal.
  2. Adaptability to Trends: It allows a brand to align with evolving consumer preferences, such as sustainability, wellness, or technological innovation.
  3. Enhanced Profitability: By creating clearer differentiation and reducing competitive pressure, repositioning can lead to higher margins and stronger customer loyalty.
  4. Long-Term Relevance: Repositioning ensures that a brand evolves with its market, maintaining its presence and significance in a dynamic environment.

Repositioning is a powerful strategy to address challenges, capitalize on opportunities, and ensure a brand remains relevant, competitive, and profitable over time. When executed effectively, it can transform struggling products into success stories and align brands with the future needs of their markets.

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Academic readings

REPOSITIONING : MARKETING IN AN ERA OF COMPETITION, CHANGE, AND CRISIS