This section contains a summary of this website in a fast, easy study note format. For full information you should also review the main topics on this site, which includes many helpful diagrams (just follow the links provided for each topic below).
Study notes for the STP Process
Definitions
STP
- Segmentation, Targeting, Positioning
The STP process is one of the core frameworks in marketing, guiding how firms can effectively reach and appeal to their intended audience. By segmenting the market, targeting the most promising segments, and positioning the product or service appropriately, firms can develop stronger value propositions and more compelling marketing strategies.
- The process of splitting a market into smaller groups with similar product needs or identifiable characteristics, for the purpose of selecting appropriate target markets.
Market segmentation enables marketers to better understand the diverse needs and preferences within a broad market. It helps to align products and promotional strategies with consumer requirements, creating more relevant marketing campaigns.
Targeting
- An organization’s proactive selection of a suitable market segment (or segments) with the intention of heavily focusing the firm’s marketing offers and activities towards this group of related consumers.
Targeting is a strategic decision, as it impacts resource allocation and brand messaging. By selecting a specific segment, firms concentrate on the highest-potential consumers who are most likely to respond positively to the offering.
Positioning
- Positioning is the target market’s perception of the product’s key benefits and features, relative to the offerings of competitive products.
Effective positioning involves establishing a unique place in the consumer’s mind, clearly differentiating a brand or product from its competitors. A consistent and powerful positioning strategy can drive customer loyalty and brand equity.
Basic Model of the STP Process
STP (Segmentation to Targeting to Positioning)
These are the three main steps in the process, starting with segmentation with the goal of developing an appropriate positioning and supporting marketing mix.
Full Process
- Define the market of interest
- Use segmentation bases to create market segments
- Evaluate the segments against criteria of factors
- Construct segment profiles and measures
- Evaluate the attractiveness of each segment
- Choose the most appropriate target markets, from the list of possible segments
- Develop an appropriate positioning strategy for the target market
- Develop and implement the marketing mix
- Review performance, over time
This structured approach ensures that marketers thoroughly identify, analyze, and select the market opportunities that best align with the firm’s strategic objectives.
Memory Tip
STEP (Segmentation plus Targeting Equals Positioning)
As a word (STEP), this concept should become easier to recall. And the inclusion of the term ‘Equals’ will help you recall that each selected target market requires its own positioning and marketing mix.
Study notes for markets, sub-markets and product-markets
Definitions
Market
- Consists of many buyers and sellers, within a particular industry or product category, who are seeking to create or gain value through the exchange of products for money.
The concept of a market refers to the broader environment in which firms and consumers interact. Marketers will generally first consider the overall market demand and potential before drilling down into sub-markets or product-markets.
Sub-market
- A smaller and more defined sector of an overall market, which has a number of differing marketing and structural features, which may include distinct distribution channels, price elasticity, competitive sets, and effective promotional methods.
Sub-markets are often identified when there is a unique set of consumer needs or specific environmental factors, such as specialized technology or geography. Recognizing sub-markets can help firms tailor their strategies more precisely and detect untapped opportunities.
Product-market
- The firm’s definition of which products and markets they will compete in, which is the key market strategy decision of ‘where to compete?’
Deciding on the product-market guides resource investment and long-term strategic planning. This decision influences how the firm defines competitors, customers, and distribution channels.
Memory Tip
The firm’s definition of its own market is the first step in the overall segmentation process. And remember, despite the term ‘market segmentation’, it is consumers in the market that are segmented – not markets or sub-markets themselves.
Why define market/s?
- To provide a clear definition of the business
- To aid strategy development
- To help identify market opportunities
- To clearly define direct and indirect competitors
- To focus the organization’s resources
- As a first step in the market segmentation process
Clearly defining the market acts as a foundation for building more refined and effective marketing tactics. It aligns the entire organization around where it will compete and how it seeks to serve customer needs.
Ways to define a market
- By industry classification
- By product category
- By country or major geographic area
- By Yellow Pages directory listings
Examples of sub-markets
- Education market
- Universities
- Private schools
- Religious schools
- Vocational colleges
- Adult education (hobbies and interests)
- Tutoring services
- Online courses
Within each sub-market, consumer needs, pricing, and competitive dynamics may vary significantly. Marketers should evaluate how each sub-market drives value and how best to approach each segment.
Examples of product-market definition
- Coca-Cola starts with the generic beverage market
- They then identify key sub-markets:
- Example, soft drinks, juice, water, and so on
- For each sub-market, they identify major geographic areas to list major product-markets
- Example, North America, Europe, Asia
By narrowing down the broader beverage market, Coca-Cola can focus on unique marketing strategies for different product lines, ensuring they cater to varying consumer tastes and competitive forces.
Study notes for market segmentation
Definition
Market segmentation
- The process of splitting a market into smaller groups with similar product needs or identifiable characteristics, for the purpose of selecting appropriate target markets.
Effective market segmentation is essential for pinpointing unique groups of consumers. By doing so, firms can concentrate on the segments that offer the best opportunities, tailoring marketing tactics for maximum impact.
Segmentation bases
- A definable characteristic, identity or behavior of an individual consumer that can be utilized to classify consumers into related groups.
In marketing research, segmentation bases provide the building blocks that allow marketers to cluster consumers in meaningful ways. The choice of base depends on the product category, firm objectives, and available resources.
Why Use Segmentation?
- Identify attractive target markets
- Greater market understanding
- Help develop marketing mix
- Gain stronger competitive position
- Identify market gaps and competitive opportunities
- Develop marketing strategies based on a stronger market understanding
- Think differently about the market
- Successfully compete as a niche marketer
- Avoid being a mass-marketer
- Have more product offerings in the same market
Using segmentation, companies can be more strategic about product development, promotional campaigns, distribution, and pricing. This strategic approach often yields more effective customer acquisition and retention.
Main segmentation bases/variables and quick examples
| Geographic | Where a consumer lives | Country, region, climate |
| Demographic | The consumer’s demographic profile | Age, occupation, marital status |
| Psychographic | A consumer’s lifestyle and interests | Values, activities, hobbies |
| Benefits sought | The reason for needing the product | Safety, esteem, convenience |
| Behavioral | The consumer’s product interaction | User status, occasion, brand familiarity |
Combining multiple segmentation bases often reveals deeper insights, allowing marketers to craft a more precise and compelling marketing strategy.
Memory Tip
To remember the different segmentation bases, simply describe yourself as consumer for a particular product category. That is, your age (demographic), country (geographic), interests (psychographic), brand knowledge (behavioral), and why you want the product (benefits sought).
Why use different segmentation bases
- Gain a competitive advantage
- Identify unmet market needs
- Deeper market understanding
- Meet strategic goals (such as growth or innovation)
- Ability to access data and undertake data mining
- Need to fragment the market to decrease competitive rivalry
By layering different approaches (e.g., demographic plus psychographic), marketers can identify more nuanced consumer clusters. This approach can open up space for innovative products or marketing messages.
Example Segmentation – (Using Demographics and Benefits Sought)
The breakfast cereal market can be segmented by using many bases. However, a simple approach is to first segment by age group and then by benefits sought. This would create nine different market segments, each with different needs, as shown:
| Example: Breakfast Cereal Market |
Main Benefit Sought |
||
|
Age Group |
Diet |
Taste |
Fun |
|
Kids |
Segment 1 |
Segment 2 |
Segment 3 |
|
Teens |
Segment 4 |
Segment 5 |
Segment 6 |
|
Adults |
Segment 7 |
Segment 8 |
Segment 9 |
Marketers can design cereal products or tailor their messaging for each of these segments. For example, “taste” might be more important to teenagers, while “diet” or “health” benefits might appeal more strongly to adults.
Study notes for the advantages and limitations of the main segmentation bases
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Segmentation Base |
Advantage/s |
Limitation/s |
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Geographic |
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Demographic |
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Psychographic |
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Benefits sought |
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Behavioral |
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Selecting the right base or combination of bases requires balancing simplicity, data availability, and a firm’s ability to accurately interpret the market. Marketers often start with demographics and then layer on more nuanced bases such as benefits sought or psychographics.
Study notes for business market segmentation bases/variables
Definition
- Definable characteristics or behavior of organizations that can be utilized to classify them into related groups.
Business segmentation focuses on grouping organizations according to their unique attributes, operational styles, and strategic objectives. This approach allows B2B marketers to develop offerings that closely match the specific needs and buying processes of different firms.
Main segmentation bases/variables and quick examples
| Main Category | Which is? | Examples |
| Geographic location/s | Where they operate | Countries, regions, spread of operations |
| Business description | Basic description of the firm, structure and size | What industry? Number of staff? Profit/growth? What product mix? Main technology? Ownership? |
| Behavioral | How they operate | Centralized? Loyal or switchers? Fast/slow decision-makers? Franchise system? |
| Culture | Their mindset/personality | Are they an early adopter? Analytical or intuitive? Socially aware? |
| Organizational goals | Strategy/objectives | High growth goals? Brand importance? Want to innovate? |
Example Segmentation – (Using Business Description and Culture)
An IT firm, which has developed accounting software for the business market, could segment by broad industry type (such as manufacturing, services and retailers – which is a business description segmentation base) and then segment by whether the firm is a lead user/early adopter or a follower/laggard (which is a cultural segmentation base).
By grouping prospective clients in this manner, the IT firm can tailor sales pitches and product features according to the tech adoption mindset and the operational environment of each segment.
Study notes for how market segmentation is undertaken
There are two main approaches: cluster analysis (if data is available), otherwise segmentation trees.
Definitions
Cluster analysis
- An analysis designed to categorize objects to a pre-defined number of different groups, with each group being relatively similar on a range of selected attributes. The resultant groups are referred to as clusters.
Segmentation tree
- A segmentation tree is a variation of a decision tree, which visually shows the division of a market into smaller possible market segments.
Cluster analysis
- Requires a suitable market research study
- Is conducted using a statistical package, like SPSS
- Respondents to the survey are clustered (grouped) together, based on their similarity of answers to particular questions
- The analyst then determines what each cluster/group has in common
Cluster analysis is popular for uncovering hidden patterns or segments. The outcome provides an empirical basis for segmentation, supporting data-driven decision-making.
Segmentation trees
- Is suitable when there is limited or no data available
- It is a visual technique, similar to a decision tree
- Is quite easy and quick to construct
- The overall market is split into groups, using one or more segmentation bases
Marketers often use segmentation trees in preliminary discussions or strategy workshops. They help visualize potential market splits and encourage brainstorming about consumer needs.
How many market segments should be created?
- The construction of three to ten market segments is common
- Any number is fine provided the evaluation criteria is met
Study notes for market segmentation evaluation criteria
This is a checkpoint stage in the STP process, which occurs after market segments have been constructed. Its goal is to ensure that the segments meet basic requirements and guidelines for usable segments.
Main Evaluation Criteria
- Homogeneous
- Means that consumers in the segment should be similar
- Heterogeneous
- Means that each segment of consumers should be relatively unique in the market
- Measurable
- Data should be available to measure the segment
- Substantial
- The segment should be large enough for the firm (sales and profits)
- Accessible
- The segment should be reachable (channels and media)
- Actionable/practical
- The firm needs to be able to implement a distinctive offering
- Responsive
- Each segment should respond better to a distinct marketing mix
By checking each segment against these criteria, marketers verify that their chosen segments can be served effectively and profitably. These considerations are vital before making resource commitments to any segment.
Study notes for segment profiles
Definition
- A segment profile is a descriptive summary of the size, needs, behaviors and preferences of consumers within a particular market segment, with the goal of evaluating segment attractiveness and developing suitable marketing strategies.
Memory Tip
Connect the word ‘profile’ to a criminal profiler that we see on TV crime shows – they develop a description (a profile) of a suspect – in marketing we develop a profile of consumers.
Segment nicknames
Firms will often give the market segments a nickname, which is their way of describing it in a quick and efficient manner. For example, calling a segment “Healthy Hedonists” or “Value Seekers” conveys a clear sense of that group’s orientation.
Segment profiles
An overview of each market segment covering a range of factors, including:
KEY MEASURES
- Segment size measures
- Segment growth rate
- Proportion of the overall market
CONSUMER BEHAVIOR
- Main consumer needs
- Usage level
- Level of brand loyalty
- Price sensitivity
- Product involvement levels
- Retailer preferences
DESCRIPTION
- Geographic spread
- Demographic description
- Psychographic description
COMPETITION/COMMUNICATION
- Main competitive offerings
- Main media choices
A complete segment profile is especially useful for aligning marketing mix elements. Marketers can determine which messaging, channels, and product features will resonate most strongly with the segment.
Study notes for target markets
Definition
- A target market is a market segment that has been deliberately selected by an organization in order to focus their marketing efforts and offerings.
Importance of target markets
- Target market selection is the second major phase of the STP process
- It is a key market strategy decision
- Allows the firm to focus its marketing efforts and match its offering to the needs of that segment
By focusing on selected targets, organizations can design a cohesive set of tactics and communications that align with the needs, budget, and media habits of the segment. This increases the likelihood of long-term profitability.
Target market selection criteria
- Size of the segment (sales)
- Segment growth rate
- Profit margins
- Competitive rivalry
- Access to distribution channels
- Importance of brand equity
- Firm’s strategic direction
- Firm’s resources
Study notes for target market selection
Target market selection evaluation criteria
- Financial Issues
- Segment size
- Segment growth rate
- Profit margins
- Structural Attractiveness
- Competitors (direct and indirect)
- Competitive rivalry
- Access to distribution channels
- Current channel relationships
- Strategic Direction
- Fit with the firm’s strategic future
- Growth expectations
- Marketing Expertise
- Resources (financial position and staff resources)
- Capability (to develop products and compete)
- Importance of brand equity (ability to leverage, dilution concerns)
- Opportunity Cost
- Are other growth options more attractive?
Firms often set up a scoring system (quantitative or qualitative) for each criterion. Segments that score highest on these factors are deemed the most attractive for targeting.
The target market selection process
- Starts with the market segment profiles
- Assesses the market segment against the criteria/evaluation checklist (listed above)
- Usually scores/rates each segment against the assessment items in the checklist
- Some firms may consider the importance of each factor (and assign a weighting)
- Then a final overall assessment is generated
- Appropriate target markets are then selected
This structured approach reduces guesswork and personal biases. It helps ensure that strategic choices align with the firm’s goals and available resources.
Study notes for differentiated or concentrated marketing?
Definitions
Undifferentiated marketing
- The offering of a marketing mix that is designed for the general needs of an overall market, without regard for the needs of the different segments in that market.
Concentrated marketing
- Concentrating the firm’s market offering solely on the needs of one defined target market.
Differentiated marketing
- The targeting of two or more market segments, with separate and distinct market offerings, which have been designed to closely meet the needs of those particular segments.
Advantages of each approach
Undifferentiated marketing
- For commodity/generic markets
- Minor differences between segment needs
- May be for strong global brands
- For small/emerging sub-markets
Concentrated marketing
- For small/new firms
- Firms with limited capability sets
- Niche marketers
- Limited resources/tough economic times
Differentiated marketing
- When pursuing growth
- Protecting market share
- When having assets that can be leveraged
- Major differences between segment needs
Study notes for niche marketing
Definition
- Niche marketing is a specialized market offering focused on the needs of a tightly-defined market segment.
Niche marketing often arises when a specific subset of customers is under-served by traditional, mass-market products. Niche marketers aim to meet these highly focused needs better than any broad competitor can.
Advantages of being a niche marketer
- Little/no competition
- Strong relationships with customers
- Business stability
- Improved capabilities and skills sets
- Focused business (no strategy distractions)
- High profit margins
The depth of understanding and the sense of community with the target consumer are major strengths of niche marketers, giving them resilience against larger players.
Examples of niche marketers
- Some consultants, with a specialized offering
- Many websites, particularly blogs
- Retailers with unusual merchandise
- Specialist engineering firms
- Non-traditional education providers
- Professional services, with specialized offerings
- Manufacturers of specialty goods
One-to-one marketing
- It is a different concept to niche marketing
- It involves tailoring an offering to individual customers (one at a time)
- Banks (with their databases) often use one-to-one marketing, as would many service providers who are able to tailor their offerings (hairdressers, consultants, and so on)
One-to-one marketing takes personalization to the extreme, leveraging sophisticated customer data to deliver highly customized solutions on a personal level.
Study notes for positioning
Definition
- Positioning is the target market’s perception of the product’s key benefits and features, relative to the offerings of competitive products.
The important aspects of this definition are:
- Positioning is the perception held by consumers
- The focus is on the perceptions of the target market
- Only the key features/benefits can be effectively communicated
- Perception is relative to competing products
Positioning ultimately resides in the mind of the consumer. Companies can influence it, but consumer experience, competitor claims, and third-party reviews all contribute to a product’s position.
Role in the STP process
Positioning is the third and final major phase of the overall STP (segmentation, targeting and positioning) process. Once target markets have been chosen, firms craft positioning statements and align all marketing activities to deliver that intended perception.
Importance of positioning
- Support overall strategy
- Differentiate offerings
- Competitive position
- Increase sales and customer loyalty
- Avoid cannibalization
- Clear communication and consistency
- Reduce price sensitivity
- Good for low-involvement purchases
- Good for habitual purchases
- Facilitate W-O-M
- Guide marketing mix development
A successful positioning strategy ensures that a brand resonates with its intended audience, fosters loyalty, and remains competitive over time.
Positioning Examples
- Melts in your mouth, not in your hands (M&Ms)
- Always (Coca-Cola)
- When it absolutely, positively, has to be there overnight (Federal Express)
- We try harder (Avis Rent-a-Car)
- Eat fresh (Subway)
- Choice of a new generation (Pepsi)
These slogans reflect each brand’s positioning strategy. They reinforce key differentiators and benefits, shaping consumer perception over time.
Tagline or slogan?
- Tagline = ongoing, part of positioning, Slogan = short-term, for a specific campaign
Study notes for main ways to position a product
Main positioning categories
- By product attribute
- By user
- By product class
- Against competition
- By use/application
- By quality or value
- By using a combination of the above options
How to choose? (Consideration factors)
- Market gaps – is there a gap?
- Substance/support – can we deliver?
- Market need – does the market want this solution?
- Competitive barrier – can competitors copy this position easily?
- Profitable – are sales good for an affordable investment?
- Communication – is the position easy to communicate and understand?
Marketers should select a positioning category that aligns with their core strengths and resonates with consumer preferences. The clearer and more credible the positioning, the more effective it will be.
Positioning category examples
- Snap, Crackle, Pop (Rice Krispies)/By product attribute
- Finger lickin’ good (KFC)/By product attribute
- No battery is stronger longer (Duracell)/By product class and by product attribute
- The un-cola (7-up)/ Against competition and by user
- Everything is easier on a Mac (Apple)/Against competition
- Once you pop, you can’t stop (Pringles)/By product attribute
- Impossible is nothing (Adidas)/By user
- Don’t leave home without it (AmEx)/By use/application
- Have it your way (Burger King)/Against competition
- A glass and a half in every half pound (Cadbury)/By product attribute
- Melts in your mouth, not in your hands (M&Ms)/By product attribute
- Always (Coca-Cola)/By user
- When it absolutely, positively, has to be there overnight (Federal Express)/By product class
- We try harder (Avis Rent-a-Car)/Against competition
- Eat fresh (Subway)/By product class
- Choice of a new generation (Pepsi)/By user and against competition
Study notes for points-of-difference (POD) and points-of-parity (POP)
Definitions
Points-of-difference (POD)
- The aspects of the product offering that are relatively distinct to the offerings of like competitors.
Points-of-parity (POP)
- The aspects of the product offering that are largely similar to the offerings of like competitors.
Both POD and POP are central to shaping brand positioning. Marketers must ensure they meet consumer expectations with sufficient POP, while still differentiating themselves with compelling POD.
POD or POP emphasis?
|
Situation |
What to emphasize |
|
When the firm is a ‘me-too’ competitor |
Points-of-parity |
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When the firm as a market leader |
Points-of-difference |
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When the firm enters an established and mature market |
Points-of-difference |
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When the firm and is a fast-growing market |
Points-of-parity |
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When there is a diversity of needs, even when looking at fairly narrow market segments |
Points-of-difference |
|
In a target market where the firm already offers multiple products |
Points-of-difference |
|
In a relatively price sensitive market |
Points-of-difference |
Deciding between emphasizing POD or POP depends on market position, consumer expectations, and competitive dynamics. Overemphasizing POD risks alienating consumers if the basic expectations (POP) aren’t met.
Under and over-positioning
- A firm that has under-positioned a product has failed to communicate a clear positioning
- Over-positioning is where the firm has over-emphasized aspects of the product and the market has a narrow perception of the product
Points-of-difference (POD) and points-of-parity (POP) example
A chain of fast food outlets competing against McDonald’s
- Points-of-parity include a similar menu choice, similar in-store dining facilities, and pricing
- Two points-of-difference are built around high-quality ingredients and having more flexibility in the menu for the individual
- The overall combination of POP and POD creates their overall positioning
This approach reassures customers that key fundamentals are on par with McDonald’s, while also highlighting unique elements that encourage switching or brand preference.
Study notes for perceptual maps
Definition
- A perceptual map is a visual technique designed to show how the average target market consumer understands the positioning of the competing products in the marketplace.
Main Types of Perceptual Maps
Using two determinant attributes only (common in most marketing textbooks)
- This simply uses two determinant attributes on the graph.
Using many product attributes
- This shows multiple attributes and product positions
Joint perceptual maps
- This map includes target market preferences
Determinant attributes
Are the particular attributes a consumer uses when they are determining their choice between competitive offerings – they are the most important and are used to distinguish between offerings.
Why use perceptual mapping
- Check reality of consumer’s perceptions
- Impact of the firm’s campaigns and marketing mix changes
- Monitor the positioning of new products
- Monitor the impact of competitive positioning
- Look for market gaps – for the new product process
- Understand segments further
- Track changes in consumer preferences
Perceptual maps are not only diagnostic tools but also strategic tools. They highlight how brands are perceived and whether certain “white spaces” in the market may represent new opportunities.
Data sources for perceptual maps
- A suitable market research study
- Relying upon management’s experience
Perception is reality
This means that the firm needs to consider how consumers actually perceive the positioning of different products, rather than a technical/objective assessment of the product.
Example: which bank is the most secure?
While a bank may claim high security, what truly matters is how consumers believe the bank compares to alternatives.
Study notes for understanding and interpreting perceptual maps
Main areas of a perceptual map to review
| Does the product have a clear and distinct market positioning? (For products with strong brand equity, being positioned close to weaker competitors is generally not a problem and would be expected). |
| Is this where the firm intended the product to be positioned? |
| Are the firm’s products positioned too closely together? If so, is this an effective competitive barrier or a cannibalization risk? |
| What market gaps exist? If a viable market gap exists, the firm needs to decide whether this is an opportunity for a new product. |
| Has any of the product positions altered significantly (if we have two maps at different times)? Is our competitive position improving or deteriorating as a result? |
| If market segments are jointly shown on the perceptual map, are we well positioned in regards to our target market/s? |
Example Review
| Findings | Comments |
| Matching of the major offerings | Coke and Pepsi products appeared to be paired together. |
| Distinct product positioning achieved by brands | The market perceives differences between the normal and the no sugar offerings under the brands of Coke and Pepsi. |
| Competitive barriers in place | Having multiple distinctive offerings (both Coke and Pepsi) in the market is a high competitive barrier (for them combined). |
| Some cannibalization likely | At times there is less positioning differential and some cannibalization of sales will probably occur. |
| Several market gaps exist | The map highlights many market gaps, these are probably viable gaps and present a significant market opportunity. |
| Non-cola advantages | The two non-cola products (7-Up and Fanta) appear to be well positioned, with both having a distinct space on the map. |
By tracking movement on a perceptual map over time, marketers can see how brand perceptions evolve due to advertising, product changes, or competitor activity. This gives strategic direction on where improvements or repositioning efforts might be necessary.
Study notes for repositioning
Definition
- Repositioning is the task of implementing a major change in the target market’s perception of the product’s key benefits and features, relative to the offerings of competitive products.
Why repositioning is used
- Changes in consumer needs and lifestyles may reduce the relevancy of the product
- New or stronger competition in their product’s positioning space
- Lack of perceived differentiation (insufficient points-of-difference)
- Under positioned product (positioning is too vague or weak)
- Over positioned product (product is too narrowly defined)
- Change in macro environment (economic conditions, technology, legislation)
- To support an improved product
- To correct a poor product launch
- If a revised target market is selected
- If the target market definition is being broadened or narrowed
- To pursue a significant and uncontested market gap
- If positioning drift has occurred
Repositioning is sometimes the only viable option to keep a product relevant or to reclaim market share. It often involves reexamining the entire marketing mix and adjusting brand messaging, distribution, and pricing strategies.
Challenges/risks in repositioning
- Will lose existing product sales
- Difficult to change perceptions
- Competitors will react
- Consumers are ‘disinterested’ in low-involvement purchases
- Can be cost-prohibitive (a new brand might be a better solution)
- Takes time and money
Repositioning efforts must be carefully planned and tested. Companies often run pilot campaigns or conduct market research to assess whether consumers will accept the new positioning.
Choices to improve poor product performance
- Reposition product
- Improve product
- Launch new product (as a replacement)
- Withdraw product (no replacement)
- Do nothing; milk product
- Improve marketing mix
Repositioning examples given
- Mother Energy Drinks, following a disappointing product launch
- Napisan, following a change in the social macro environment (lifestyles)
- Credit Union, following the identification of lack of clear positioning space
These examples underscore how firms often reshape brand identity to stay aligned with evolving consumer trends or better defend themselves against competitors.
Study notes for connecting positioning and the marketing mix
How is positioning created?
Positioning is created in consumers’ minds through the combination of many information sources over time, including:
- IMC (communications) mix of the firm
- Competitor IMC mix and their product claims
- Product features (particularly if the consumer uses the product)
- Packaging (first impressions)
- Word-of-mouth communication
- Media articles and internet reviews
- Type of retailers that stock the product
- Price levels and sales promotions used
Each element of the marketing mix should convey the intended positioning consistently. Inconsistencies across channels or brand touchpoints can dilute or confuse the desired perception.
Outcomes of a non-supportive marketing mix:
- Poor sales as the product does not appeal to any target market
- Consumer dissatisfaction
- Low repeat sales
- Retailer disappointment
- Negative word-of-mouth
- Negative media and Internet reviews
A misaligned marketing mix can quickly derail even a solidly conceived positioning strategy. Ensuring all marketing elements – from product development to promotional tactics – support the same market message is key.
How to fix?
- This problem is easily rectified by simply aligning the marketing mix to a consistent positioning goal
Inconsistent positioning example
- Running sports shoes: for serious runners
- Advertising in specialty running magazines and websites
- Low quality materials used
- Discount store channel
- Low price
In this example, the promotional messages target serious runners who value performance and durability. However, the product materials and channel choice suggest a budget-friendly approach. This contradiction confuses consumers and undermines the intended positioning. Ensuring consistency throughout the mix is crucial to establishing credibility and trust with the target market.