Positioning Hi Quality Papa John Select Target Position

Positioning Hi Quality Papa John Select Target & Position Pizza Hut Slow Dominos Caesars Low Quality Fast

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Where we’re at: The 3 rd Level of Strategy Corporate Level Business unit Level Functional Strategy Information systems Research & development Finance Manufacturing Marketing Human resources

What We’ve done… Situation Analysis Company Consumers Competitors Conditions SWOT Analysis

What We Know… Company v Mission, resources, Strengths & Weaknesses, growth & competitive strategies v How the market is segmented & relevant factors that influence consumers’ purchasing decisions Competitors v The nature & magnitude of competition for the consumers’ time & $ Conditions v Existing & emerging Macro-E Trends that can impact on strategic decisions Consumers

Situation Analysis • Company • Consumers • Competitors Strategic Planning Marketing Strategy P’s The Marketing Mix: Growth & Competitiv e Strategies G N • Conditions C Service TGT • PEST Positioni ng Strategy D E WM F

What We do Now… Targeting Select Target & Position The process of evaluating segments & selecting those that are most attractive to pursue Positioning Determining how a brand should be perceived & fit into lives of target consumers

Key to Successful Marketing Strategy Convincing the right person(s) that you offer the best product, available at best place, at the best price…

Marketing Strategy Success Contingent on Formulating right Marketing Mix around the most profitable target & competitive position Price Product Target Customer & Needs Position Promotion Distribution

Marketing Strategy Success contingent on formulating your Marketing Mix… so that it üSpecifies - the way you Product Price want consumers to think & feel about your product/service üDefines - how you will be differentiated & thus compete in marketplace Target & Position Place Promo Positioning is the Centerpiece (literally & figuratively) of Marketing Strategy

l Positioning is not what you do to product… l Positioning is what you do to the Consumers Mind…

Positioning is- the place the product occupies in consumer’s mind-- Relative to other competing products Hi Quality Papa John Pizza Hut Fast Slow Dominos Caesars Low Quality

The Consumer Mind - Set Consumers organize the product field according to communicated conventions Mercedes=Best Armani=Best Pentium=Best Bud=Most Pop. Wal-Mart= Low Price, High Variety

The Product Ladder l Every product field has a pecking order l The top brands & the also available

To find Your Product’s Position …You Need to get into consumer’s head & Map the product field from the consumers point of view

Mapping Product Positions Gives you a visual representation of where consumers place competing brands along key dimensions G Prices N C Service TGT D E WM F

Steps in Creating “Product Position” Maps 1) Identify relevant set of competitive brands Evoked Set 2) Identify key attributes consumers use to evaluate brands Consideration Set of each brand -on each attribute 3) Determine consumers’ perceptions 4) Plot product’s position across attributes 5) Plot customer ideal points (market segments)

Paired Comparisons 1 -----100 Hi Calorie Heavy Light Low Calorie

Full Body Paired Comparisons 1 -----100 Premium Popular Priced Low Calorie

Semantic Differentials SA-----SD

Multi-Dimensional Scaling *Becks *Budweiser *Heineken *Old Milwaukee. *Meister Brau *Miller *Coors *Strohs *Michelob *Miller Lite *Old Milw. Light *Coors Light

Position Map – Automotive market Figure 5 -6 Luxury • Lexus • Mercedes Cadillac • • BMW • Porsche Lincoln • Traditional • Chrysler Oldsmobile • • Buick Mercury • Ford • Dodge • Plymouth • • Pontiac • Chevrolet • Nissan • Toyota • Saturn Functional • VW Sporty

Position Map - Bar Soap High moisturizing 7 • Tone 4 • Zest • Lever 2000 • Dove 2 5 • Lux Nondeodorant 8 Deodorant 3 “With Relative Size of Consumer Segments” 1 • Lava 6 Low moisturizing • Dial • Lifebuoy

W/ Position Map In Hand… Every Marketing strategist has 4 options: 1. Innovate 2. Relocate 3. Procreate 4. Denigrate

Positioning Strategy Option #1: Innovate Develop & Introduce a New product… …in a New Position

Cherchez Le Creneau! Find a new or unoccupied position that is important to consumers

Find Un-Occupied Soap Space High moisturizing 7 • Tone 4 • Zest • Lever 2000 • Dove 2 5 • Lux Nondeodorant 8 3 • Safeguard Deodorant 1 • Lava 6 Low moisturizing • Dial • Lifebuoy

Find Un- Occupied Beer Space • BUD 1 4 • Corona 5 2 • Miller Cheap 3 7 6

l 1 st Light Beer l 1 st Cheap Pen l 1 st Women’s Cigarette

l Who was 1 st person to walk on moon? – …The 2 nd? l Who was your 1 st “Big -Nooky”? – Your 2 nd?

Staking out a Position w/ a Proposition l The first person to claim a benefit is the one who becomes associated with it in the minds of consumers. Thick & Juicy/ Where's the You Deserve a Break Today… Have it Your Way

--Finding an Open & Lucrative Position is Difficult-l Product Space already very competitive l Mind-Space is very limited & already occupied

PRODUCT POSITIONING Evoked & Consideration Sets-occupied The mind will hold only a few alternatives in memory & disregards all others

What’s in Your Evoked Set? Rental Cars? Tissue? Soft Drinks? Fast Food? Potato Chips? Computer Chips?

Positioning Strategy Option #2: Relocate Redesign & Re -introduce an Existing product… …in a New Position

Re-Position Nearer to Ideal of most/more profitable. Expensive target group Anacin Tylenol Nuprin Advil Motrin Reformulate, Bayer Repackage. Medipren &/or more directly Promote: Tylenol for effective Headache Relief Ideal St. Joseph’s Inexpensive For Body Aches For Headaches Ideal Excedrin Tylenol Bufferin

I Larger Seg

Juxtaposition Old Style Market Rollout “TASTES As Good As Budweiser…” But Costs a Whole Lot Less!

Positioning requires “Consumer Partipulation” You have to get the consumer to participate in their own manipulation Manipulate what is already in the mind of the consumer… ü Do not challenge existing perceptions ü

If you can’t be 1 st … at least be Real is # 1 Avis is only #2 in rental cars – So why go with us? –“We try harder”

The Classic Juxtaposition The Originals Avoids contradicting what’s really in consumer’s mind

Positioning involves… Comparatives not Superlatives Not the BEST Thing l Coca Cola – “The Real Thing” – Infer l all others are imitators “Lite Beer from Miller. – “Everything you always wanted in a beer. And less. ”

Positioning Strategy Option #3: Procreate Develop & Introduce a number of New products… …in multiple Positions

Expensive Procreating calls for developing & Excedrin positioning multiple products … Anacin Nuprin Bufferin Advil Tylenol Motrin Medipren Bayer Medipren Plus St. Joseph’s Medipren Cold &Flu Inexpensive I For Body Aches For Headaches I

The Master of Multi- Branding Procter & Gamble: Every Brand w/ its own Position Tide: for family market Cheer for clothes -conscious w/ color guard Bold: for value-conscious – w/ fabric softener Gain: for scent-conscious – w/ aromatics Era: for dirt-conscious – w/ stain removers Dash: for price-conscious Dreft: for new mothers Ariel: for eco-conscious

Michelob Light, Michelob Dry.

Michelob Diluted its Position A position of power “Michelob was the first high-priced Premium-domestic beer--Then they launched into Michelob Light, Michelob Dry … Honey Lager … Hefe. Weizen… l “They started to become everything to everybody… and they became nothing”

A note of Caution about Multi-Branding l Be Careful when introducing/ positioning a new product-- especially if you're using the family brand-name

Be careful w/ Brand Extensions (using existing brand name in new product category) l Kodak Crayons l Exxon Office Furniture Established l Gerber Life Insurance perceptions not l Life Savers Gumcompatible across l Xerox Computersproduct classes l Kleenex Towels

Arm & Hammer Products… A Success- Established perceptions readily transfers product classes utubes

Positioning Strategy Option # 4: Denigrate Place Competitor's product… …in a less Favorable Position

Repositioning the Competition Royal Doulton, the china of Stratford-on-Avon Vs. Lenox, the china of Pomona, New Jersey

Repositioning the Competition u. Tube l Nuprin vs. Tylenol vs. Aspirin – l Tylenol campaign pointed out the negative affects of aspirin (stomach upset) Scope vs. Listerine u. Tube Minty Breath Not Medicine Breath No & w Li ste w/ Cin rm na int mo n u. Tube

Repositioning the Competition Visa: They won’t take American express NOT

Developing & Implementing Positioning Strategy Differentiation The World On Time Communication

Choosing & Implementing a Differentiation Strategy 1. Stakeout optimum position Based on your most salient competitive advantage 2. Focus on Single. Competitive Advantage often best…Helps to gain “positioning intensity” 3. Position strengthened by noting your strengths in conjunction with your competitors weaknesses— übest quality ülowest price übest value ümost reliable

Developing Differentiating Statements For (target customers) Who are dissatisfied w/ (current market alternatives) Our product is (a new product category) That provides (key capability) Unlike (competing alternatives) We provide (the desired alternative).

G Nordstrom’s Differentiating Statement Prices N C Service TGT D E WM For discriminating shoppers Who are dissatisfied w/ long-lines and substandard customer service… Our product is offering only the highest quality and service, That provides the premiere prestige retailer Unlike other retailers who take your business for granted, We … are committed to making you our most important customer. ” F

G Prices N Target’s Differentiating Statement C Service TGT D E WM For F who appreciate value and service Who are impersonal big box retailers who sell inferior dissatisfied w/ products… Our product is Target is the premiere value retailer… That provides offering a unique mix of quality products, low prices and a friendly shopping environment Unlike other discount retailers who offer low quality products and stores, We are committed to offering the most enjoyable and valuable shopping experience

Wal-Mart’s Differentiating Statement G Prices N C Service TGT D E WM F For shoppers seeking the lowest price every time Who are dissatisfied w/ clipping coupons and waiting for sale- promotions Our product is Wal-Mart is the premiere discount retailer That provides offering every day low prices, Unlike other discount retailers who make you shop (for sales) when they want you to We provide are committed to offering you the lowest prices everyday. ”

In our Hyper-Competitive-Global market The need to differentiation grows greater everyday … Differentiate or Die: Survival in Our Age of Killer Competition l l From the early 1970 s to late 1990 s, the number of automobile models grew from 140 to 260; the number of over-the-counter pain relievers went from 17 to 141. “That makes positioning - the marketing tactic of differentiating a product or company in the mind of a prospect- more important than ever” l Jack Trout A position of power

The ultimate success of any positioning strategy comes down to 2 Key Decisions 1. Choosing most salient variable w/ which to distinguish your product from competitors 2. Selecting best communication platform to convey your product’s unique position

Your 1 st Decision: l On What Dimension or Variable… – do you want to compete? • Differentiation Strategy “Putting your Best Foot Forward”

Criteria for Selecting the Right Competitive Advantage Must be relevant to a consumer need that motivates purchase/usage Determinant Affordable Profitable Criteria for Determining which Differences to Promote Preemptive Distinctive Superior

Differentiation Variable Options Product • Actual • Augmented Consumer • Benefits • Users

Product Levels Augmented Product Service Distribution Delivery Price Quality Brand Name Features Actual Product Packaging Warranty Payment plan. Credit Design After. Sale Support Installation

Product Differentiation Variables • Actual • Augmented Product Attributes l features l performance l durability l reliability l repair-ability l style l design

Differentiation Price/Quality -Attributes

Product Differentiation variables: • Actual • Augmented Customer-Service Attributes ldelivery linstallation lcustomer support

Product Differentiation variables • Actual • Augmented Employees/ Personnel l competence l courtesy l credibility l reliability l responsiveness l communication

Product Differentiation variables • Actual • Augmented Channel Coverage l Expertise l Performance l

Differentiation Variable Options Product • Actual • Augmented Consumer • Benefits • Users

Consumer • Benefits • Users “Consumers Buy Benefits not Products” l People buy Holes, not drills! l People buy Hope, not cosmetics!

Toothpaste Market Differentiated by Benefit Segments Sensory Segment Principal benefit Sought……. . Brands……… disproportionately favored Flavor and product appearance Colgate Sociable Segment Brightest of teeth Macleans, Ultra Brite Worrier Segment Decay prevention Crest Figure 5 -3 Independent Segment Price Cheapest brand

Procter & Gamble: Each Brand offers a Unique Benefit

Consumer • Benefits • Users Positioning by use or application Differentiation based on: l How a product is used l The number / variety of uses l New / Changing patterns of use

l Differentiation thru Product use -

REPOSITIONING-Revitalize REPOSITIONINGsales w/ New uses (mature product) From old. Fashioned Dessert—to-Children’s &/or adult fun product Arm & Hammer Baking Soda

Expensive Excedrin Anacin Nuprin Bufferin Advil Tylenol Emerging Ideal. Daily Heart Med. I Bayer Motrin Medipren I St. Joseph’s Inexpensive For Body Aches For Headaches I

Consumer • Benefits • Users Product Positioning = Consumer Positioning Consumers Buy Products to define & differentiate themselves Ø Designer Label- clothes, cosmetics, perfume Ø“Top-Shelf” Liquor Ø Automobiles Image Congruence between Product’s Qualities / Connotations & Consumer’s Personality / Persona

l Differentiation by user: Revolt Jeans

The Marlboro Man u. Tube

u. Tube

Finally you must effectively communicate your competitive Advantage 1. Choosing the most salient variable w/ which to distinguish your product from the competitors 2. Selecting the best communication platform to convey your product’s unique position

Communication Strategies Cognitive. Logical focuses on problems, solutions or benefits sought by customers l how product features help solve problems or achieve benefits l Got emotional product positioning? Affective. Emotional appeals to the heart l focuses on emotions, feelings, or drives associated with product / service l

A position of power “When a company doesn't present a clear message Ø that its product is unique Ø in a way that is relevant to customers, Ø those customers have no reason to buy it” Ø

Four Major Positioning Errors 1. Under-positioning - consumers have only vague idea of the brand. 2. Over-positioning - consumers have too narrow a view of the brand. 3. Doubtful Positioning - consumers don’t believe the brand’s claims 4. Confused Positioning - consumers confused about the brand due to frequent changes or too many claims.

Burger King’s search for Position 76 Have it your way. 86 -87 This is a Burger King town. 77 -78 America loves burgers and we’re America’s Burger King. 87 78 -80 Who’s got the best darn burger? 89 -91 Sometimes you gotta break the rules. 80 -82 Make it special. Make it Burger King. 91 -92 Your way. Right away. 82 Aren’t you hungry for Burger King now? 82 -83 Battle of the burgers. 83 Aren’t you hungry? 83 -85 The big switch. 85 -86 Search for Herb. 86 -87 This is a Burger King town The best food for fast times. 87 -89 We do it like you’d do it. 92 -94 BK Tee Vee: I love this place! 94 Back to basics 94 -96 Get your burger’s worth. 96 -98 It just tastes better. 99 Go the distance 2000 Got the Urge 01 -02 The Whopper Says 02 -03 At Burger King You Got It

Hi Quality Papa Johns Variety Pizza Hut Fast Slow Dominos Caesars Low Quality