Product Positioning Framework
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What is Product Positioning?
A simple product positioning definition is where your product or service fits in the marketplace. It outlines all of the features that make your product unique and communicates how and why it’s better than other products or solutions.
Think of product positioning as your product’s foundation—this messaging will drive the rest of your go-to-market plan, from the content your marketing team creates to how your sales team speaks to prospective customers. Without it, your marketing plan will fail when pressure-tested against your competition. Effective product positioning considers your target audience and their needs and how your product can directly and effectively address those needs.
However, product positioning can also be applied to products without an existing market. Apple mastermind Steve Jobs famously said:
“People don't know what they want until you show it to them…. Our task is to read things that are not yet on the page.”
When creating a new product category or market, your product positioning will establish how you convince your customers of a need they didn’t even know they had.
Why is Product Positioning important?
There are very few products accepted as the ideal solution for everyone. So, trying to target a general audience will highly probably result in failure. That’s why product teams have to find the right audience that will find the product appealing. Also, it is their responsibility to advocate the product in a way that the product catches the audience’s fancy.
However, this does not mean that your product can solely have one position. On the contrary, your product can have more than one position directed towards different demographics. But, you should keep in mind that each audience has to find something appealing in your product. Then, you can develop different messages for every audience you are targeting.
Benefits of product positioning
We’ve prepared the top benefits of product positioning that show why it’s one of the most effective marketing tactics. It helps in:
identifying key benefits of a product and matching them with customers’ needs;
finding a competitive advantage even when the market changes;
meeting customers’ expectations;
reinforcing brand’s name and its products;
winning customer loyalty;
creating an effective promotional strategy;
attracting different customers;
improving competitive strength;
launching new products;
presenting new features of existing products.
6-step framework for effective product positioning
You can’t nail product positioning in one go and then forget about it.
Product positioning is an ongoing and evolving process that needs to adapt in response to changes in your industry and your customers' needs.
Let's look at a six-step framework you can follow to achieve the right positioning for your product.
1. Understand why your target audience uses your product
Your customers are using your product over your competitors for a reason.
If you can identify why that is and investigate what exactly makes them use and stick to your product, you can use that insight as the basis for positioning your product.
The why could be factors like pricing, a specific feature, customer service, associations with the product, or ease of use. The better you understand why customers use your product, the more customer-led your positioning can be to make your place in the market more prominent. Here are a few ways to perform this research:
Use on-site surveys on high-traffic product pages. Ask questions like "Why do you use this product?", "How would you rate this product on a scale of 1–10?", "Which feature or product element do you use the most?", and "How would you feel if you couldn't use this product anymore?" Answers to these questions will give you authentic feedback and insight into what your customers think and feel about your product as existing users.
Study product reviews by past and current customers to identify what they like about the product. Feedback can be sourced from video reviews, product demos, customer interview recordings, and customer service chats.
Ask your customer service executives to ask a "what do you like most about the product" question at the end of every ticket. You can also implement this on a live chat feature or feedback widget on your product's website.
2. Analyze your competitors
Once you understand your audience, you want to position your product as a better solution than your competitors. But you can't do that unless you know the competitor's product and how they're positioning it.
Conduct market research to analyze your competitors' new and old products to understand how they're helping customers, which features they have, and what benefits they offer.
Identify whether you have any distinct features that can set you apart. If not, iterate on your product and focus on being more customer-centric than your competitors, so you have something that sets you apart in the market.
3. Identify your unique selling proposition
Once you understand what gaps you can fill in the market to meet customer needs, it’s time to identify your unique selling proposition (USP).
Your USP is the one thing that sets you apart from your competitors and acts as a big draw for your product. Find a unique product angle, a unique feature, or any purpose, use, application, or factor that sets you apart from your competitors.
For example, Gilette and Dollar Shave Club are both popular grooming companies. But Gilette entered the market with their razors first and became a recognized brand. Soon, Dollar Shave Club came up with a similar product but positioned it as affordable by using pricing as their USP.
4. Communicate your product positioning internally
More than conveying your product positioning to your users, you need to ensure your team members are crystal clear about it.
Everyone from employees to stakeholders needs to understand the product positioning you want to achieve, how it will look, how the product messaging will change, and what it means for their day-to-day product-related activities.
Here are a few tips for doing this:
Create a product positioning document Your product positioning statement is just one aspect of how you want to place yourself in front of your customers; other values, benefits, and features define what your product stands for.
A product positioning document helps communicate how your organization should look at your product, and how exactly they should convey it to your customers to create a solid product image in their minds.
5. Establish and implement a positioning strategy
With your organization onboard with your positioning vision, you need an air-tight positioning strategy to take you from how your customers currently feel about your product to how you want them to feel about it.
For this, you need to create and put an effective product positioning strategy into action. Here's what you should do:
Define your product positioning statement This short description says what your product is, who it’s for, and why exactly customers should care about it. Here, you can use the research done in the first three steps of the framework to develop a statement for your product. Use this formula:
(Product name) is a (product category) that helps (target customers) achieve (differentiating benefit your product offers) to avoid or solve (users' needs).
Example: Slack is the collaboration hub that brings the right people, information, and tools together to get work done.
Prepare a marketing strategy to communicate your revised product positioning You need to communicate your product positioning to your audience and potential customers through every channel—ads, social media, emails, customer interaction, calls, etc. This can be as subtle as a plug for your product in your blog posts to tell users how your product helps solve a problem, or as explicit as a sticky promotional banner across the entire site.
Remember to tailor and align your messaging and communication with your product positioning to see positive results.
6. Keep your product positioning up to date
Your product will evolve as you grow, and customer behavior and buying trends will change with time. So, can you sustain your business on product positioning you decided based on past customer needs and last year’s market research? Probably not.
Iterate on your product positioning to ensure it stays relevant and differentiates your product in the market.
Regularly ask yourself these questions to ensure you're leading with the right product positioning:
Is your current product positioning statement still relevant for your customers and market?
Have you introduced any new product features or new products altogether which offer a new benefit to your customers?
Are there any new products in the market similar to yours? Are they doing something differently?
Have the market demand or customer needs changed?
Is there a better way to communicate your product positioning?
Are you getting good results with your current strategy? Compare your past and present metrics like sales, customer retention, conversion rate, referrals, social media engagement, and signups to get data-driven insights.
The answers to the above questions will tell you if you need to revisit your product positioning strategy and make it more relevant for customers.
The idea is to tell the customers what they need to know about your product so they'll believe in it and purchase it.
Examples of Product Positioning
Dollar Shave Club
The name says it all, right? Dollar Shave Club positions its products to the male audience that does not want to pay too much for grooming. This way, they were able to create a brand that is synonymous with affordability and convenience. These two aspects are quite relatable for the average customer.
Their main competitor is Gillette which is more expensive and has a very manly tone to its branding. Unlike Gillette, Dollar Shave Club has a more casual and playful tone. Even their adverts differ. Gillette uses more masculine and tight-looking actors in its advertisements, whereas, in Dollar Shave Club’s adverts, you can see more casual-looking people you can relate to.
This is how successful Dollar Shave Club’s product positioning is. It is known for being cheaper, more relatable, and more convenient than its competitors.
Tesla
The brand of one of your favorite billionaires, Elon Musk, has positioned the products quite successfully. It is a brand that produces high-quality, eco-friendly, and expensive cars. Due to the prices of cars, Tesla leaves price out of sight and focuses more on being eco-friendly and luxurious.
Also, since the cars are electric, they manage to differentiate themselves from other gas-powered luxurious vehicles and be more comfortable than the standard electric cars. Thanks to these two points, they can position their product way better than an ordinary vehicle company.
Also, Elon Musk made this brand fun. For example, a guy named Joe said that autopilot chimes are too loud and wake up his baby. Tesla then created silent mode and named it “Joe Mode.”
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