Multimedia Marketing/Marketing.iso/market/chapter2.3p

Text File | 1996-08-22 | 16KB | 333 lines

SECTION  2.3  Product Positioning

INSTRUCTIONS Indicate how you think companies should describe their
products to target markets in order to achieve differential advantage.

EXAMPLE

Most consumers believe that grapefruit is a breakfast food. Very few
eat it with other meals or at times of day other than  morning. The
major growers have made an attempt to position the product differently.
They have attempted, through advertising, to get the idea across that
this is a delicious and nutritious food that can be consumed with
lunch, dinner, or as a snack. Advertisements point out the health
benefits of grapefruit--attempting to take advantage of current interest
in health, personal appearance, and weight control. It is difficult to
change this image, however, as many consumers continue to view the
product as solely a breakfast food.

DETAILS

Product positioning involves placing the product uniquely in the
minds of target customers, relative to rival offerings. Management
may position products according to target customers, product
characteristics, or product benefits. In all of these cases, they
attempt to create an image among target customers of what the
product means and how it should be viewed.

 Some clothing designers position according to target customers,
as by aiming at high-income groups. Others focus on the youth or
baby-boomers market(those who are currently in the age 50-60 range).
The youth market is often a preferred one because older consumers
sometimes imitate the clothing patterns of teen-agers, after the
latter have introduced the new styles.

A candy bar producer positions according to product characteristics.
Since one major competitor produces very sweet candy bars and another
offers candy bars that are low in sugar content, this marketer
positions its products between the two, with an intermediate sugar
content. Some automobile producers position according to the power
and acceleration of their products. Others emphasize style.

A credit-card company positions according to product benefits.
Management positions the firm as the one providing the most conveniences
to customers. This is in contrast to a rival, that positions
itself as a provider of funds in emergency situations. Some shoe
brands are positioned for comfort, others for appearance. Still others
are intended to improve athletic performance.

PROBLEM 1

A manufacturer of telephones desires to position its offerings as
high-quality customized products that carry high prestige value.
The marketing device that would be most useful in establishing
this position is:

A. The use of air-freight to provide fast transportation to
   distribution warehouses.
B. Extension of liberal credit terms to target customers.
C. Creation of a wide line of color combinations for the phones.
D. Advertisements in magazines such as The New Yorker and Harpers
   Magazine.

WORKED
A manufacturer of telephones desires to position its offerings as
high-quality customized products that carry high prestige value.
Advertising in magazines such as The New Yorker and Harpers
magazine could be useful, in this regard. The readership of these
magazines coincides with the target market that the manufacturer
is attempting to reach.

Today companies rely heavily on advertising to position their
offerings, although product, price, place, and other promotion
activities may be useful in this regard. Advertising delivers a
message directly to target customers as to what the product is
and what it is intended to deliver. Several manufacturers of
tools, for instance, carry the message in their advertisements
that their products are for professional mechanics and very
serious hobbyists and not for the casual do-it-yourselfer, who
is usually content with lesser quality goods.

ANSWER D

INSTRUCTIONS Indicate how you think companies should describe their
products to target markets in order to achieve differential advantage.

EXAMPLE

Most consumers believe that grapefruit is a breakfast food. Very few
eat it with other meals or at times of day other than  morning. The
major growers have made an attempt to position the product differently.
They have attempted, through advertising, to get the idea across that
this is a delicious and nutritious food that can be consumed with
lunch, dinner, or as a snack. Advertisements point out the health
benefits of grapefruit--attempting to take advantage of current interest
in health, personal appearance, and weight control. It is difficult to
change this image, however, as many consumers continue to view the
product as solely a breakfast food.

DETAILS

In positioning the product, managers can take efforts to discover
what product attributes are most valued by consumers. A producer
of soft drinks, for instance, might discover, through
a consumer survey, that the degree of sweetness and the fullness
of the flavor are the two factors which are most valued for this
beverage.

After determining what factors are most important, the marketer
probably would want to learn how the company brand fares on the
factors. Management also would desire to learn what target customers
desire as to these two factors. Do they want a very sweet product?
Do they want one that has a light flavor? In other words, what
combination of these two factors do target customers look for. Then
managent could take steps to find out how competitors compare with
the company as to this ideal.

Assume that management discovers that a large group of target
customers want a not-too-sweet (tart) and light flavored product.
If the company product has these attributes, it would appear that
it is well-positioned. This may not be the case, however, if there
are several large competitors who also offer tart and light flavored
beverages. Such a situation may mean that there is too much competition
in that sector of the market.

The company could be better off with a tart and full flavored
beverage if there is a large group of target consumers who want
such a beverage and if there are few competitors in that market.

It is apparent that marketing research can be useful for product
positioning. It can indicate what product attributes are sought
after, the product attributes of the ideal brand, and the
attributes of the company brand.

PROBLEM 2

A  snack foods producer is bringing a new  baked potato chip
offering to market. Management wants to position the product.
Before anything else can be done, management should:

A. Find out what factors are most important to target customers
   for potato chips.
B. Acquire data on the market share for potato chips that competitors
   control.
C. Conduct surveys to find out the motivations of consumers when
   they purchase competitors' potato chips.
D. Find out what types of target consumers competitors are appealing
   to.

WORKED

A snacks food manufacturer is introducing a new baked potato chip
offering to market. Management wants to position the product. Before
anything else can be done management should find out what factors
are most important to target customers for potato chips. Once these
factors are known, management can begin the effort of determining
how the company might place itself against competitors in a meaningful
way.

In positioning a product, management begins by uncovering information
on what factors are most important to target customers in selecting
the product under study. A producer of fine glassware did this by
assembling small groups of target consumers and asking them to
discuss, in an informal manner, what they liked and disliked about
fine glassware.

 The results were interesting to management, which
had always assumed that texture was an important feature to most
target consumers. This turned out not to be the case, however. Rather
most members of this group were interested in the tint and the weight
of the glassware. This convinced management that the company's
offering should be positioned along these dimensions.

ANSWER  A

INSTRUCTIONS Indicate how you think companies should describe their
products to target markets in order to achieve differential advantage.

EXAMPLE

Most consumers believe that grapefruit is a breakfast food. Very few
eat it with other meals or at times of day other than  morning. The
major growers have made an attempt to position the product differently.
They have attempted, through advertising, to get the idea across that
this is a delicious and nutritious food that can be consumed with
lunch, dinner, or as a snack. Advertisements point out the health
benefits of grapefruit--attempting to take advantage of current interest
in health, personal appearance, and weight control. It is difficult to
change this image, however, as many consumers continue to view the
product as solely a breakfast food.

DETAILS

Further marketing research is needed in order to progress with
the positioning strategy. This requires selecting target markets,
and is a very critical step because it will determine the nature
of the marketing strategy which the firm will pursue.

Once management is familiar with relevant segments and competitor
positions, it is able to select a target where a favorable market
niche can be created. After discovering a combination of marketing
functions that numerous target consumers find to be their ideal and
that competitors are not providing, management should take steps
to determine the characteristics of consumers in that position.

A survey might discover that there is a large group of target
consumers who prefer a very sweet and full flavored soft drink
and that there is not a competing beverage that satisfies this
market segment very well, prompting management to find out who
these individuals are. A survey might reveal that these individuals
tend to be pre-teen boys who are active in sports and other outdoor
activities. Management's task would be to design and implement a
marketing mix that appeals to this group.

PROBLEM 3

A contemporary greeting cards manufacturer is positioning a line
of its products. Management has commissioned a marketing research
firm to uncover information on product functions that are desired
and on the positioning of competitor products. This has led the
company to decide to appeal to younger consumers with a line of
humerous cards. The next logical step for the company to take is:

A. Find out consumer attititudes toward the prices of greeting
   cards.
B. Conduct research on what brands of greeting cards are most
   popular.
C. Plan and carry out a marketing mix for the company cards.
D. Determine if the proposed new line of cards has synergy with
   other lines of cards offered by the company.

WORKED

A comtemporary greeting cards manufacturer is positioning a line
of its products. Management has commissioned a marketing research
firm to uncover information on product functions that are desired
and on the positioning of competitor products. This has led the
company to decide to appeal to younger consumers with a line of
humorous cards. The next logical step for the company to take is
to plan and carry out a marketing mix for the company cards.

The last step undertaken by marketers in positioning a product or
group of products is to formulate and actually implement a marketing
mix. A producer of heating pumps for industrial use recently pursued
these steps. Management decided that it would offer heating pumps
that were state of the art--of higher quality than any competing make.
Prices were set at high levels, with discounts for high volume
purchasers. Management decided to sell the goods through its own
sales force, backed up by advertising in three trade magazines. It
was decided that existing company warehouses and the company fleet
of trucks would provide very competitive distribution facilities.
The company implemented these decisions and found that market
reaction to its new line was very favorable.

ANSWER  C

INSTRUCTIONS Indicate how you think companies should describe their
products to target markets in order to achieve differential advantage.

EXAMPLE

Most consumers believe that grapefruit is a breakfast food. Very few
eat it with other meals or at times of day other than  morning. The
major growers have made an attempt to position the product differently.
They have attempted, through advertising, to get the idea across that
this is a delicious and nutritious food that can be consumed with
lunch, dinner, or as a snack. Advertisements point out the health
benefits of grapefruit--attempting to take advantage of current interest
in health, personal appearance, and weight control. It is difficult to
change this image, however, as many consumers continue to view the
product as solely a breakfast food.

DETAILS

There are a large number of cases where a manufacturer has not
adequately positioned its products or a retailer has not effectively
positioned company stores. This tends to be most common for small
businesses, but there are some large firms that have performed
poorly in this area.

Failure to clearly position a product will leave the company in
a position where consumers do not know what a product stands for.
Without a clear position, the product will not stand out from
others. It will be confused with other companys' products and many
consumers will not know if the product fits the description of
something they want or not. Failure to position a retail store
or chain of stores will have the same consequences.

Some manufacturers and retailers do not position adequately because
of indecision. At one point in time they may orient their marketing
mixes at blue collar workers and, later decide that this was a
mistake and focus on white collar. Then they may switch back again.
Or they may position themselves as a company that provides many
customer services and later switch to a stance of low prices and
few services. Such indecisive behavior can severely harm their
images.

It should be emphasized that positioning is something that takes
place in the mind of the consumer. It does not require physical
changes in the product. If advertisements convince consumers that
a product occupies a particular position, that is all that is
needed.

PROBLEM 4

A wheelchair manufacturer has not positioned its major product--a
low cost mechanized chair. This is likely because:

A. The chair is poorly designed.
B. The chair is more expensive than competing products.
C. Company promotions have not pointed out the advantages of the
   product.
D. The chair is handled in the wrong retail establishments.

WORKED

A wheelchair manufacturer has not positioned its major product--a
low cost mechanized chair. This is likely because company promotions
have not pointed out the advantages of the product. The strongpoints
of the chair are not important to consumers if they do not know what
they are. Advertising, personal selling, and sales promotion are
needed so that consumers can visualize what this chair means, relative
to products of other companies.

After the company has decided upon a market position, it is necessary
to select a strategy which will enable it to successfully satisfy
target consumers at this position. In the next section we will
examine some possible strategies.

ANSWER C