What is differentiation and positioning in Marketing?

Nowadays, a market surplus in any niche is what we can expect on average. It is all but impossible to start manufacturing a product that has an incredible demand and an underperforming supply. In fact, even the most basic of products come in multiple varieties and from dozens of companies.

For that reason, companies have to find a way to differentiate themselves from the competition. So they have to create marketing strategies with that in mind. Furthermore, they can’t rely on existing strategies. Their competition is always trying to “one-up” them and beat them out.

But that is not the only reason for companies to change their strategies regarding their products. Every product, regardless of what the nature of the product is, has a life cycle and only the companies that adjust their strategies to extend the product life can see consistent profitability.

 

Market positioning

There are several tough choices companies have to make regarding the product offering. The first choice is the market segment they want to operate in. Secondly, they have to choose exactly how they want to brand their products. Then, they have to position their brand’s image in a way that will help them reach their consumers.

Advertisers should bear in mind that positioning is not about their products. Instead, it is all about the consumers they want to target. The challenge of positioning is to create a positive perception in the minds of consumers regarding your brand.

In order to figure out positioning, a company has to start by deciding which idea they want to promote. Namely, they want to choose which ideas can put them ahead of their competition.

The idea they choose should give customers clarity in regards to the message of the product. After all, the company with better positioning will usually come out well ahead of the competition if the products they offer are of a similar nature.

 

Market differentiation

Positioning as such is an excellent way to reach customers and convince them to buy certain products. However, it is usually not enough in and of itself. The next step a company should take is differentiation.

Differentiation is a process of making a certain product stand out from the crowd. A company can add more meaning to the product, and they can highlight the differentiating factors and features.

The main reason differentiation is very important is the fact that there are competing companies trying to offer similar products. Those companies will usually try to replicate or outdo any and all attempts of highlighting benefits. Differentiation of brands is there to highlight the benefits that are difficult to replicate. Moreover, it makes brands more likely to turn a profit with their product offerings.

 

Tools of Differentiation

There are many variables a company can leverage to generate differentiation. The main tools are the service the company offers, personnel, channels of distribution, brand image, and most importantly, the product itself.

The attributes of the product are one of the strongest bases of differentiation. But depending on the industry, it is not always easy to differentiate between products. Certain industries offer products that are too similar to each other. It takes a lot of marketing effort to truly differentiate one brand of bread from another one. Conversely, there are industries that make differentiation exceedingly easy. For example, the automobile industry offers a wide variety of products that are naturally different among each other.

If a company is operating in an industry with little to no product differentiation, they can rely on services to stand out. Companies can focus on the ease of placing an order, customer service, and consulting. A company can build brand awareness and positive brand imagery by creating a connection with the customer. The connection can also span outside the realm of the product. Efficient and courteous personnel can do a lot more than many believe.

The channels of distribution a company uses can do a lot to help differentiate one brand from another. For example, customers will appreciate doorstep-delivery systems from companies that offer direct selling.

Lastly, companies should always remember to try and build a brand image that sets them apart from the competition. Companies can organise giveaways in order to build brand recognition quickly. Moreover, they can sponsor events as a quick and efficient way to build brand differentiation.


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