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What differentiates you, product, price, market or service, defines you

How do I use positioning in my business?

The first step is ensuring that each of the four categories – product, price, market, and service – is aligned. Southwest Airlines does that brilliantly whereas United and American charge higher fares without the comparable improvement in service and charge for bags. It is no wonder Southwest is constantly rated one of the top airlines to fly.

Many small businesses make these same mistakes -- cutting costs at the expense of client value, or trying to offer high service levels at a too low a price. These decisions, the lack of alignment, affect their position.

Remember that we want to be positioned so we’re top of mind, one of the first businesses our potential clients think of. Any misalignment across these four areas acts to confuse consumers. And confusion makes it hard for them to remember us.

Here’s a reminder of those four areas. One of them will be your primary position. All need to be aligned.

Product – What are you selling (it could be a product or a service)? How does it compare with competitors in your market?

Price – How does your pricing compare – are you expensive, cheap, or in the middle? If you have several products, are they all aligned?

Market – What is your market? If you sell to business, are they corporate, mid tier, or small businesses? If you sell to consumers, are they the top, mid, or low end of the market?

Service – What are your levels of service? And do all of your customers receive the same level of service regardless of how frequently they use your products or service?

When reviewing these areas within the business, use arrows to show your business model strategy.

If you have different products, markets, divisions, departments, suppliers, do the exercise for each one whatever is relevant for this business. How aligned are the different parts of your business? Are they aligned with each other?

So far, we’ve discussed many different aspects of choosing your market position. For positioning to be successfully implemented, for it to be readily applied to areas of your business as diverse as culture, marketing and focus, then it needs to be summed up in a something brief enough for your whole team to remember at all time: One word.

Ideally you are looking to identify one word that encapsulates your business. For example Volvo chose safety, whereas Rolls Royce chose luxury and Jaguar chose style.

So how do you choose your one word? Begin with a brainstorming session – on a whiteboard or paper, alone or with your team, write down all of the words or short phrases that actually describe what you do. These might be things like ‘innovate’ or ‘respect our customers.’ Record each one under one those four headings – product, price, market or service. Once the initial list runs out, specifically address each one: How would you describe your Product, etc.

Having selected your words, or in the case that you might be uncertain, completing a competitor analysis is a useful activity. A company can map itself and its competitors to show the different messages that are being communicated in the marketplace. If all the competition is positioned in a similar way, the customer is only left to choose on price (although this gives you a great opportunity to position yourself differently).

The first step is defining the market in which you and your competitors operate. A market matrix has two axes – up and down, and side to side. This allows the market to be split into 16 boxes.

So what axes do we use? This depends on the criteria your clients make their decisions on.

In most markets, the vertical axis is price – cheap up to expensive. The horizontal axis has relationships on one side, product on the other. This separates businesses that are used for their great product (often product or price positioned) from those who build great relationships with clients (often market or service positioned).

You now have a strategic choice to make. This depends on how strongly that word describes your business today, which box you want to position yourself in, and how well your position is understood by external parties.

There are five options to consider when choosing the appropriate positioning strategy for a business. The options are:

1.        You are not sure what your position is – Create a position

2.        No clear position – Build a position

3.        You have a position but it is not what you want – Rebuild a position

4.        You have a position but it is not aligned within the business – Align a position

5.        You have a clear and aligned position that is not being used – Leverage a position.

Now you have the one word and a positioning strategy you need to incorporate it in everything you do in promoting and marketing your company. Next time you see a Volvo commercial on TV or in print or on the web they will be reinforcing their one word -- safety. What is your word?

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Nigel Hartley is a Business Coach with Shirlaws Coaching, Shirlaws is an international coaching firm that works with businesses in three areas-revenue, productivity and strategy, and we focus not only on commercial aspects of doing business, but on the cultural factors that affect human interaction as well. You can contact Nigel on 707 573 7154 or by email at nhartley@shirlawsonline.com. www.shirlawscoaching.com