What is Positioning?

A strategy is an integrated set of choices that?positions?a firm in an industry so as to generate superior financial returns over the long run.

Leaders decide what problems to solve. It's incumbent on leaders to decide how a product, service, or company is positioned, but too often, positioning is viewed as writing or merely how things should look. Aesthetic choices are important expressions of strategy but they aren’t themselves a strategy.

When it comes to positioning, the questions are easy but the answers are hard. We help companies create and refine their positioning.

Here are the five key positioning questions:

1. Audience?– Who is your user, customer, influencer?
2. Category?– Where are you going to play?
3. Claim/Promise?– How are you going to win?
4. Brand/Offer?– What identity encapsulates your meaning?
5. Support?– How will you deliver on your promise?

We've created a?positioning template to help address these important issues.

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Define your Audience

It's easy to assume you?know your customer. Any existing business or industry is based on selling to a known audience, however, this equation is often lopsided. Too much internally-focused optimization can lead companies and entire industries to drift away from their customers.

People can tell you what they want, but often they can't tell you what they need. Understanding what your customers really need requires research. Helping companies connect with their customers is, in part, our?reason for being.

Define your Category

The industry in which you play is also not obvious. We’re seeing evidence of?category blur?in nearly all segments. This used to sound like hyperbole until there was an app for everything. Even seemingly uninterruptible segments like durable goods or food seemed to be on the table when Amazon acquired Whole Foods and featurized entire industries like shipping and home entertainment.

Category changes can be hard to see within an industry. A new lens can help you chart a sustainable course.

Define your claim or promise

Once you define your audience and category, the next strategic decision is your promise. What are you claiming in the marketplace? How are you going to be different or better? Language can start to play an important role as we think about how you communicate your message, but your claim is a positioning choice – independent of language. Your claim is not a slogan, it’s a direction.

Your claim is a pathway for innovation. Starting to say different things can allow your company to do different things.

Define your brand identity

Ultimately, these decisions help you create a?meaningful brand?– not just what customers are buying, what they’re buying into. Brand hierarchy, logos, names, messages, tone, imagery, standards, and other brand assets add up to an effective brand program.

Brands are the perception of value in the mind of the customer. A clear definition and narrative can shape how customers think and what your company can do.

Define how you will support your claim

What will you do to support your claim? Making a claim doesn’t make it true. Teams building meaningful brands understand?customer experience?as a strategic differentiator. CX strategies are how a positioning claim is supported and how you deliver on value propositions. People are loyal to brands that deliver on their promises.

Customer loyalty is earned one touchpoint at a time. A proactive approach to CX and UX design will help to improve each customer or user interaction.

Positioning is about Decisions

Doing the hard work of creating a strong position is a critical step to create a sustainable brand. Companies with a weak position may need to be reset entirely. Strong positions can be improved – you can always increase your understanding of customer needs and category shifts, refine how your brand and claim reflect the current reality, and how you will innovate to deliver customer value.

How will you know if you’ve made good decisions? Here are a few tests that we find are helpful to pressure test your thinking.

• Positioning is about?direction. Repositioning may be about reorienting the business a few degrees today which, over time, will allow you to reach a different destination. Hopefully, it’s a blue ocean. If your position doesn’t take you in a clear direction, you haven’t gone far enough.
• Positioning accounts for a?changing landscape. Know how fast your customer is moving. Technology, globalization, culture, and other factors are reshaping your industry. Your competitors may or may not be moving too slowly, so just keeping up with them may not be enough. Getting to know your customer better isn’t merely a one-time event – it’s a philosophy.?
• Good positioning enables a?bigger future.?Customer loyalty isn’t earned with your specific product or service, it’s about something else. When you claim something new and different, it should allow you to become a bigger version of yourself. Ultimately customers buy based on emotions and behaviors –?taste, expertise, habit, trust.

A more simple way to define strategy is by deciding where to play and how to win. Know what game you’re going to play, and position yourself on the field that best enables you to come out on top.

Learn more about brand meaning and customer experience on our website.

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Strategy definition and positioning framework from HBS.

Positioning is often equated with branding and branding is too often viewed as merely cosmetic.?Our book?addresses this and other brand topics. The iceberg on the cover serves as a metaphor for what is unseen when it comes to building brands.