1.1.3 Market positioning Flashcards
market positioning important part of marketing strategy
segmentation - targeting - positioning - marketing mix
The role of market positioning in marketing strategy
Decision 1: Choose which customers to serve
This involves:
Market segmentation (analysing the different parts of a market) Targeting (deciding with market segments to enter)
Decision 2: Choose how to serve those customers
This also involves two important parts of marketing strategy:
Product differentiation (what makes it difference from the competition) Market positioning (how customers perceive the product)
A useful framework for analysing market positioning
positioning/ market map
e.g.
highprice
I
low qual -+-high qual
I
lowprice
Advantages/Disadvantages of positioning maps
+Help spot gaps in the market
Useful for analysing competitors
Encourages use of market research
-just because there is a “gap” doesn’t mean there is demand
Not a guarantee of success
market research not always reliable
definition competitive advantage
a feature of a business or product that enables it to compete efficiently with rival procuts/companies
competitive advantage achieved by
cost leadership: prodcue goods lower price than competitors but same qual
product design: unique superior design that appeals to lots of customers
customer service: exceptionell levels
product qual: high qual item - premium price
ethical stance: deal ethically with suppiers and resources
innovation: USP of product - comp advantage, differentiation ! but only short term
advantages/disadvantages competitive advantage
+ higher profit margins - growth sustainability
helps establisg strong position in market
resilience afgainst e.g. economic downturns
sustainability - manage succes over LT
Purpose of Product Differentiation
Competitive Advantage
Brand Loyalty
Increased Profit Margins: because customers perceive them as unique or superior
Reduced Price Sensitivity: if they perceive the product as offering greater value or quality
Target Specific Customer Segments
Product differentiation definition
process of distinguishing a company’s product or service from others in the market by creating unique characteristics that set a product apart from competitors, making it more appealing to consumers
pros and cons of product differentiation
+ higher profit margins
+ higher customer loyalty
+ reduced comp
+ incresed perceived value
-higher cost e.g. R&D
-risk of imitation
-dependdece on innovation
methods of differentiation
branding, promotion, innovation, pricing, more qual
definition added value
increasinf the diffrence between the cost of making the product and the price that the customer pays
how add value
design - unique
production - efficient (cost advantage)
quality - premium price
marketing - brand identitiy
benefity adding value
more proft, more competitive advantage, more market share,
