Most business owners attribute the poor sales to low quality of product or service, but what they overlook is positioning matters more often in terms of lackluster performance in sales. Paying attention on product or service per se is not wrong. However, the positioning of your product or service, in the modern world, is the first and foremost thing to do. Since we are living in an overcommunicated society, the information for each person is overwhelming. Finding the right positioning for promotion is therefore more important than ever before.
To be first in a category can be very advantageous in positioning. We always remember the first, e.g. the first man to be sent into space, and ignore the second. This is first mover advantage. Actually, you don’t need to be the first brand in a category, but you need to be the first one to occupy prospects’ minds in terms of this category. And you don’t need to drive your competitors out of the market. Instead, you need them to enlarge the market size. It’s better to be a big fish in a small pond (and then increase the size of the pond) than to be a small fish in a big pond. And it’s not size that makes a company strong. It’s mental position which contributes to market share that makes a company strong.
A product is something made in a factory. A brand is something made in the mind. To be successful today, you have to build brands, not products. To build a brand is actually to insert an idea into prospects’ minds. But to move a new idea or product into the mind, you must first move an old one out, i.e. reposition your competitor. Usually, repositioning competitors means saying something bad about their products or services.
If your brand or product has a negative impression in consumers’ minds, then there will be no better way than introducing a new brand and a new product. The same principle also applies to the name of a brand. When you want to change a strongly held opinion, the first step to take is usually to change the name. Since consumers have associated the original name with a kind of opinion. In terms of name, what you must look for is a name that begins the positioning process. A name that tells the prospect what the product’s major benefit is. And don’t use a too general name for a brand, e.g. there are many companies whose names include United. Names for low-calorie and low-cost products have to be carefully selected to suggest the benefit, i.e. don’t expose the “low” feature too obviously, otherwise the name would drive the prospects away because they don’t want to be embarrassed by exposing their weaknesses to others when purchasing these products. After acquiring another company, remain the product name for its position in prospects’ minds. A well-known name has been remembered for its products. A new product needs a new name.
Don’t easily change the positioning of your product. Consistency in positioning and advertising your product or service is important. Don’t even change it to appeal to more consumers. The biggest single mistake that companies make is trying to appeal to everybody. Rather than asking yourself “Who are we trying to appeal to?” Try asking the opposite question “Who should not use our brand?”
Be cautious on diversification on product line, which makes no sense for positioning. It’s a fact of life that strong positions in the prospects’ minds are built on major achievement, e.g. people only know GE for its electrical products instead of computers.
Leadership alone is the most powerful position in marketing. Consumers always believe in market leaders.
Your product must have a real difference to justify the high price of your product.
People see what they expect to see, taste what they expect to taste, believe what they expect to believe.
If the industry of your company is declining, get yourself a new one. Place your bets on the growing industries.
Always try to work for the smartest, brightest, most competent person you can find.
The more business friends you make outside of your own organization, the more likely you are to wind up in a big, rewarding job.
You need others to screen your positioning in order to be objective.
When to use the house name and when not to:
1. Expected volume. Potential winners should not bear the House name. Small volume products should.
2. Competition. In a vacuum, the brand should not bear the house name. In a crowded field, it should.
3. Advertising support. Big-budget brands should not bear the house name. Small-budget brands should.
4. Significance. Breakthrough products should bear the house name. Commodity products such as chemicals should.
5. Distribution. Off-the-shelf items should not bear the house name. Items sold by sales reps should.