Positioning relates to developing the marketing strategy for an organization. Rather than focusing on business processes or the product, positioning is about how the customer perceives the product or service.
The first half of this book is about how the mind works relating to receiving and responding to marketing messages. Today people are bombarded with information and marketing messages. The total of all printed knowledge doubles every four or five years. More than 4000 books are published around the world every day. With the Internet, there is an inconceivable amount of information available to anyone with a personal computer and a modem.
With all of this "noise," it's amazing we can even get a marketing message through to a customer or potential customer. The overload of information creates mental clutter and confusion.
In order to penetrate this noise, the marketing communicator must present a very simple, straightforward message in a way that is attractive to the customer or potential customer. Two approaches that have worked effectively are by presenting the information as "news" or as a "slice of life story."
When developing a positioning strategy, an organization is developing a consistent framework of communicating what it is to the customer. When it deviates from its historical message, it creates confusion in the marketplace and can lose market share. An excellent example is when Coca Cola introduced New Coke. The market had a huge history of buying the "Real Thing." Coke weakened its identity and had to scramble to sell "Classic Coke" to stop the bleeding.
When companies try to increase their business by "line extension," they are risking losing their customer base by losing their identities. In order to protect their existing business, it's safer to create a new subsidiary or brand to create a new identity for the separate product line.
The second half of the book is a series of case studies showing how companies who had lost their identity focus or had a weak one improved their marketing results by re-examining their strengths and re-positioning themselves. One example was Lotus Development Corporation. After virtually creating the personal computer market for IBM compatibles with its spreadsheet program, Lotus extended its line to other products such as Improv, Ami Pro, Freelance, Notes, and Symphony. They lost the spreadsheet market to Microsoft. By refocusing its efforts on groupware, Lotus was successful in re-establishing market strength with its Notes product.
For an excellent framework in making strategic marketing decisions, be sure to read The New Positioning.
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