What Is Brand Positioning

Brand positioning is a strategic approach to establishing a sustainable competitive advantage. Wikipedia defines competitive advantage as “the strategic advantage one business entity has over its rival entities within its competitive industry. Achieving competitive advantage strengthens and positions a business better within the business environment.” [Wikipedia]

There are different ways to improve a business competitive advantage and I mention some of them below. But before I do it, it’s important to understand that the objective of brand positioning is not to bring your competitors down, but to outshine them by performing better and more efficiently cater to the needs of the industry’s customers.

There are five generic competitive branding strategies useful in brand positioning. These generic competitive strategies are:

a low-cost leadership strategy
a broad differentiation strategy
a best-cost provider strategy
a focused strategy based on lower costs
a focused strategy based on differentiation.

Let’s take a closer look at each of them.

1. A low-cost leadership strategy entails the process of appealing to the broad spectrum of potential buyers by being able to offer an overall low cost product or service. Example: Walmart, Dell Computers

2. A broad differentiation strategy is one in which a business seeks to differentiate its products or services from their competitors in ways that attract the broadest spectrum of customers in an established industry. Example: Mercedes cars, Apple

3. A best cost provider strategy is one that offers customers more value for the buck, with a lot of emphasis on the low cost of the product or service in comparison to its high quality. Great example is Toyota with its Lexus luxury models.

4. A focused strategy on lower costs is a brand positioning strategy that concentrates on out competing rivals, by offering customized products or services at a lower cost to a smaller portion of the established buyers. Example: many small retailers offering their own label or discounted line of products.

5. A focused strategy based on differentiation is one in which the focus is on a narrow segment of buyers who are offered a product or service that has been customized to meet their exact tastes and demands and supersedes what competitors are offering. Example: any successful niche retailers (The Perfume Shop, etc.).

Each of these branding strategies focuses on achieving different types of market positions. They each demand different tactics of competition and business operation. A business’ brand position should aspire to mount offensive strategies that can effectively neutralize and overcome the strengths and capabilities of established competitors. The best competitive advantage a business can attain from its brand positioning is one in which competitors find hard to thwart.

The ideal brand positioning strategy will differ for each business. However, there are ways to achieve a competitive advantage by focusing brand positioning strategies on the competitor’s weaknesses. Pay special attention to the portion of buyers that rivals ignore or are ill-prepared to serve. Go after the customers of competitors whose product lacks in quality. Make special sales pitches to customers of existing competitors. Try to focus on competitors with weak advertising and weak brand recognition. These offensive brand position strategies can be implemented on an individual basis or used together for a major competitive offensive strategy.

What is your favorite brand positioning strategy? Do you have one for your business?