Installment two.

“If you’re going to chase Amazon on price, I don’t think it will be a successful strategy” was one of the comments made at the recent NRF annual convention by a featured speaker. That statement summarizes what this series is about…competing on other than only price and promotional offers.

Last week’s post (Market Analysis), the first in this series, addressed market analysis as the first step to differentiating and brand-building. This week focuses on product positioning strategies, one of the faster strategies to differentiate and brand-build.

Stated last week, market analysis is the starting point for differentiation and brand-building because it helps you identify and better understand market segments, a must-have for effective product positioning.

What’s product positioning?

The most robust segmentation strategy is market segmentation, where companies have different marketing mixes (products, pricing, etc.) for different market segments.

Product differentiation is somewhat similar, except the products and pricing are the same, and it is the channels, marketing communications and merchandising that is segment based. Product positioning recognizes that people may buy the same products for different reasons.

And, in some cases product positioning is even used only to make marketing communications more relevant and to increase brand-building. Think about beer advertising on TV. When you see a beer ad that is specific to a sport, such as NFL football, that is product positioning based only on audience, not the reasons they buy.

Why bother?

Differentiation takes more effort, so why bother?

Since people purchase for different needs and motivations, if you only “speak with one voice” you will not help any of them understand the features and benefits of your products as well as you could, doing them and your company a disservice.

Differentiation allows you to communicate, educate and be relevant more effectively. And with consumers using so many channels now to make purchase decisions, it is more important than ever in forming relationships through social media, providing content and promotions, and better understanding shopping behavior for mobile marketing where real estate is limited.

So, while you’re more effectively marketing your products to different market segments based on their unique needs, wants and motivations, you will be more relevant to consumers, and therefore differentiating and building your brand(s).

How do I go about it?

The first step in making this happen is…you guessed it, market analysis, specifically market segmentation.

Unless you market necessities, such as “TP,” I suggest you start by identifying the different purchase motivations for the market segments in your markets. This is the “why,” why do people buy your and your competitors’ products?

Personally, what I’ve found works best is to prioritize the motivational market segments you want to target.

For example, working for a manufacturer and direct-seller of high quality nutritional supplements, vitamins and meal replacements, we identified there were five motivational consumers segments, with two where our products were best suited. From there we could focus on better understanding and positioning products to these two segments.

Does anyone really do this?

Another, very basic, example is from my work in the meal replacements market. You’ll note, the product category is called meal replacements, not diets. Previously, our brand had only been marketed to consumers who purchased to lose weight. Market analysis revealed that there were two other purchase motivations, meal substitution and convenience. With this knowledge, the brand could be marketed to two market segments that had not been targeted before.

Working with another manufacturer (who sold wholesale and direct to consumers) on a brand launch, market segmentation identified that though there were some similarities in needs across wholesale customers and consumers, there were also significant differences. As a result, we could position and merchandise the products differently to the two audiences, since we reached them in different channels.

It is important to emphasize that in the examples, and in general for product positioning, it is the products that are being differentiated, it is not the brand. Branding needs to be consistent across all audiences and channels to maximize branding.

In the brand launch example above, the branding was based on the overlap in needs that wholesale and consumer market segments shared.

When executing your product positioning, make sure you do in sales channels, not only in marketing channels. For example, re-launching a software brand, market analysis revealed that retail store customers had different purchase motivations and needs than consumers who bought the same brand online. Since we had to package products differently for retail stores anyway, we took advantage of that knowledge when we designed the packaging for stores, much more effectively positioning products by sales channel.

Same time, same channel

Next week’s post will build on market analysis and product positioning, focusing on sales channel optimization for differentiating and brand-building. Last week’s post on market analysis can be found here; Market Analysis

In the meantime, if you have any questions about market analysis, product positioning, branding, e-Commerce, growth or marketing strategies, you can reach Paul at

Last updated by .

Leave a Reply