Defining services Activities, benefits and satisfactions, which are offered for sale or are provided in connection with

the sale of goods(American Marketing Association, Committee of Definitions 1960, p. 2). Services include all economic activities whose output is not a physical product or construction, is generally consumed at the time it is produced, and provides added value in forms (such as convenience, amusement, timeliness, comfort or health) that are essentially intangible concerns of its first purchaser (Quinn, Baruch and Paquette,1987). Service marketing is a respected sub-discipline of marketing. The Special Characteristics of Services Intangibility Inseparability of production and consumption Heterogeneity Perish ability

The Intangibility of Services (I) It refers to the total lack or perception of a services characteristics before and (often) after it is performed The term was first used in 1963 (Regan) It is the most radical characteristic of services, where from the others emanate Marketing implications Great marketing skill in tangibilising intangible offerings, i.e., in surrounding them with hard peripheral attributes Technical superiority and long term vision in new service development, in order to protect a service from its non-patentability Special pricing know-how, i.e., what is the cost of a service? Creative communications skills, i.e. what message to communicate?

The nature of services marketing

So far, much of what has been said could be equally applicable to either a product or a service. So, is there anything special about services marketing? At one level, the theory of marketing has universal application the same underlying concerns and principles apply whatever the nature of the business. However, the nature of a particular service business may dictate a need to place much greater emphasis on certain marketing elements, which in turn could lead to different marketing approaches. It is frequently argued that services have unique characteristics that differentiate them from goods or manufactured products. The four most commonly ascribed to services are: Intangibility services are to a large extent abstract and intangible. Heterogeneity services are non-standard and highly variable. Inseparability services are typically produced and consumed at the same time, with customer participation in the process. Perish ability it is not possible to store services in inventory.

The Nature of the Services Act Who or what is the direct recipient of the service? Services directed at intangible assets, e.g.,: Banking Accounting Insurance Services delivered at peoples minds, e.g.: Education Theatres Museums Intangible actions Services directed at goods physical possessions, e.g.: Freight transportation Laundry and dry cleaning Industrial equipment repair Services directed at peoples bodies, e.g.: Health care Haircutting Beauty salons Tangible actions What is the nature of People Things the service act?

CONSUMER BEHAVIOUR IN SERVICES

Objectives After studying this unit you should be able to: review the basic concepts of Consumer Behavior; outline the stages in consumer decision making process; explain the factors influencing buyer behavior; and understand the concepts of search, experience and credence qualities and their implications on consumer decisions making process for services.

INTRODUCTION All of us buy different services for various reasons. One person may prefer to go to a restaurant for good food while the other may opt for an exclusive restaurant, for status. One person may prefer to read The Times of India early in the morning, while the other may prefer to read the same newspaper after coming back from the office. There are women who dont go to beauty parlors at all, whereas there are others who go regularly. Similarly, there are many such examples telling us that people show different behavior in buying and using different products and services. The discipline of marketing which helps in developing a deeper insight in these behavioral differences is called Buyer Behaviour. We have developed an appreciation that the meaning of marketing orientation is that a firm should aim all its efforts at satisfying its customers. And to keep customers satisfied it becomes essential to have a deeper knowledge regarding the behavior of the buyer.

SEARCH, EXPERIENCE, AND CREDENCE QUALITIES One of the most significant differences between goods and services is that in goods Search Qualities dominate while services are dominated by Experience and Credence Qualities. Figure 4.3: Continuum of evaluation for different types of products Source: Zeithaml and Bitner, Services Marketing, Tata McGraw-Hill. Search qualities are those attributes of a product which the consumer can determine before the purchase. This is more common in physical goods. For example colour, style, fit, feel, smell etc.

The second is the experience qualities, which are the attributes which can only be determined after the purchase, or during the process of consumption. The third, is the credence qualities i.e. characteristics which the consumer can not evaluate even after the consumption, like auto repair or medial diagnosis. For example, it may be difficult for a patient to assess whether or not a hospital provided appropriate services. Such characteristics exist invariably in services. In nutshell, most goods are high in search qualities and most services are high in experience or credence qualities. Figure 4.3 gives a continuum of evaluation for different types of products based on search, experience and credence qualities. As services are rich in experience and credence qualities, the following important aspects related to consumer decisions making process need to be understood. Information Search: In the case of services, consumers rely more on personal sources of information for pre purchase evaluation. Also they indulge in more post purchase evaluation than pre purchase evaluation and as a result the amount of post purchase evaluation done in services is much higher that in case of goods. Some of the reasons for this are: i. Mass communication conveys very little about experience qualities. ii. Most of the service providers are local/independent and therefore lack the financial or marketing acumen to promote their offering. iii. Shared advertising is rare as the producer and retailer are the same in services. iv. Very few attributes of services could be discovered prior to purchase. Criteria for Evaluating Quality: Consumers normally tend to evaluate the quality of a service offering through its price and physical facilities provided by the service provider. Higher the price better is the quality perceived. Same holds good for physical facilities. This is especially true when other cues for evaluating quality are not available. Evoked Set of Alternatives: In services the customers evoked set of offering is small. This is due to the following: i) Differences in retailing: In services the offerings of the competitors are rarely exhibited unlike in case of goods. Also it is highly uncommon to find more than one provider of a service in a given area. ii) The consideration set is small as very little information is available prior to purchase. In case of Non-professional services the evoked set includes self provision of services. e.g. housekeeping, laundry etc. Innovation Diffusion: Consumer adoption of innovations is much slower in case of services than in products. This is because consumers have to find a distinct benefit in the offering of the competitor to shift to that. Complexity of services

makes it difficult to evaluate the ability of the provider and indivisibility does not allow trying the service before consumption. Perceived Risk: Consumers associate greater risk with buying services than with goods. This is on account of intangibility of services which makes it difficult to get information about the offering. Most services are not standardized even if they are provided by the same provider because a lot depends on the persons caliber and ability to customize it based on the need of the consumer. Another important reason is that unlike in goods most services do not come with guarantees/warranties. Brand Loyalty: Brand switching is lesser with services as compared to services. This is due to the following factors: i) Greater search and monetary cost associated with moving to another service provider. ii) Fewer substitutes are available for services. iii) The rapport that a consumer creates with a service provider prevents him from moving to a new provider as there is always a possibility that the new provider may not understand his needs as well as the previous one did. Attribution of Dissatisfaction: The provision of the service is based on the requirements stated by the consumer. As such he holds himself partly responsible if the service provided is not up to his requirements and hence complains less frequently. Perceived Control: The model proposed by Bateson emphasizes that consumers evaluate services control, they are able to exercise in a given situation. Perceived control theory is based on the premise that customers feel more satisfied with a service if they believe that they have greater control over the service delivery. This notion is useful when designing new services similarly, if the employees also think the same way, satisfaction drawn from the job is higher. However, they two may not co-exist. Simultaneously, therefore, it is important for the organization to balance out between the two, by developing adequate service standards, communicating the same to the consumers, to deliver the services adhering to those standards and developing systems for operational efficiency.

CONSUMER DECISION MAKING The consumers decision to purchase or reject a product or service is the moment of final truth for the marketer. It signifies whether the marketing strategy has been wise, insightful, and effective, or whether it was poorly planned and missed the mark. Marketers are therefore interested in the consumer decision-making process

by which a consumer selects one alternative amongst the lot available. The decision not to buy is also an alternative. A simple consumer decision-making model, as shown in Figure 4.1, ties together the psychological, social and cultural concepts into an easily understood framework. The decision model has three distinct components input , process , and output. Input component of the model include firms marketing efforts (marketing mix activities) which communicate the benefits of the products and services to potential consumers and the non-marketing socio-cultural influences. Sociocultural influences include family, friends, social class, subculture and culture. The combined effect of firms marketing efforts, influence of family and friends, culture etc. affect what consumers purchase and how they use them. The process components deals with the consumer decision making which involves need recognization , prepurchase search and evaluation of alternatives. The decision making is affected by the psychological field i.e. the internal influences. These influences include motivation, perception, learning, personality and attitudes. The output portion of consumer decision making model includes two associated activities i.e. purchase behaviour and post purchase evaluation. A more comprehensive purchase model was suggested by Fisk3, who divided the purchase behavior into three distinct stages viz. Pre-consumption Phase, Consumption Phase (Service Encounter) and Post-consumption Phase. The first stage called the pre-purchase stage includes activities which take place before the actual purchase decision. These activities are typically called, problem/need recognition, information search on various alternatives and evaluation of alternatives to select the best of them. At this stage, the individual recognizes a need or problem whose solution usually involves a potential purchase. He searches for information from various sources-both internal and external and arrives at a set of possible solutions The evoked set. The second stage is called the consumption stage. This arises if outcome of the prepurchase stage is a decision to buy a certain brand of service. In this stage the expectations of the pre-consumption stage are compared with the actual service delivery. This stage is therefore called the service encounter stage. Finally, the post-purchase stage, which results in a decision whether to purchase the same service again or not.

Figure 4.2: The Three-stage model of consumer behavior The reasons why people buy or the motives of buying can be put into three categories, namely: buyers goals, wants and beliefs. As far as general intentions are concerned, people prefer to be in good or positive conditions and not otherwise. They prefer to be rich and not poor, entertained and not bored, clean and not dirty, healthy and not sick, fed and not starved etc. A more acceptable and positive condition gives rise to a vision which the consumer tracks in the pattern of purchase for a better life. This positive and preferred vision in pursuit of better life is also called as the set of goals to which a buyer strives. These set of goals, perhaps, cannot be achieved simultaneously and therefore priorities are being set to attain these goals. The other aspect of these goals is that they also keep on changing as the time passes, hence leaving a scope for the firm to influence the goals of a buyer. On the other hand, wants emerge from the buyers goals. To want a particular product or service is nothing but to have a preference and desire to use it or possess it. For the purpose of convenience, wants are classified into two; standing wants and a current wants. Standing wants are those wants which are related to permanent goals and the current wants are those reflecting our existing circumstances. At this stage a clarification may be noted that the needs are common to all but wants are socially and culturally oriented. For example, all of us have the basic need for food when we are hungry while the choice of a restaurant will be made by different people, differently, keeping in view a set of variables, like type of food, quality of food, price, atmosphere, etc.

Strategic Marketing and its implications for Professional Service Providers Rate This Many of my readers may not be aware that I facilitate Marketing a Professional Practice workshops. These workshops are designed to teach professional service providers ranging from architects to doctors to management consultants how to build their reputation and market themselves elegantly in an inter-connected society. At my last workshop, I was asked for a classical explanation of strategic marketing and its value and why it should be in writing. So, here is my response: As Lee Iacocca, former chairman of Chrysler says that the discipline of writing things down is the first step toward achieving them. Strategic Marketing is a conscious and systematic process that involves the following steps: Selecting target market segments using such classification as industry, readiness for consulting, company or division size, function, or issues such as productivity etc. y Analysing the specific needs of those market segments; y Developing the capabilities to address the target markets needs with expertise, relevant programs, and assessment and evaluation tools (that includes determining costs, prices and delivering service options); y Designing visibility and credibility strategies to increase name recognition and reputation in the selected marketplaces; y Identifying prospects and making presentations to specifically address prospective clients unique interests; y Providing the highest quality of consultant services on client projects; y Managing consultant client relationships to ensure on-going mutually beneficial partnerships. Develop & Implement Cost-Effective Strategies, Tools & Techniques
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The late Howard Shenson, in his book The Complete guide to Consulting Success writes that the marketing strategies consultants use have a profound effect on their chances for success.

He advocated the use of low cost and no cost strategies for consultants as his research showed that the use of indirect, more public relations like activities are far more effective than direct, hard-sell techniques that so many consultants use. Tom Lambert echoed this in the book High-Income Consulting. Lambert used to conduct, in Europe, the worlds leading seminar on building and sustaining a consultant practice, which was attended by more than 200, 000 attendees worldwide. Lambert said that your overall marketing strategy should be aimed at becoming well known in your field, and that indirect methods of marketing brings clients to you. He also emphasised that the tactics that you select must be consistent with the reputation and image that you want to create. Laurence G, Boldt writes in the book Zen and the art of making a living that the name of the game in marketing is circulation. Getting into circulation and staying in circulation. Getting out and meeting people is circulating. Circulating flyers, making speeches is circulation. I liken it to Name Recognition. Whatever technique or tactic you use must be designed to increase your name recognition and to build your reputation. Above all, you need imagination and effort to try and see what works and what dont work. For more information and some handy tips regarding marketing consultancy services, read my chapter that I wrote called Consultancy Marketing: Developing the Right Mindset in the bookThe Advice Business Essential tools and models for Management Consulting by Prof. Charles Formbrun and Mark D.Nevins or attend the next Marketing a Professional Practice workshop in Johannesburg on the 24th June. Footnote: The Marketing a Professional Practice workshop used to be called Marketing a Consulting Practice. Due to it attracting professionals like architects, lawyers and other professionals I have decided to change the name to be more in line with the target market.

Market Analysis & Customers Needs Identification Whats in There for Me? 3 topics for 3 specific Skills 1. Understanding our New World - A Perfect Competition? - Customer inside all 2. Marketing Strategy - Market Research - Market Targeting 3. Sales Management - Planning Sales - Sales Operations

Part 2. My Marketing Strategy Market Research Market Targeting Well study these 2 notions at the same time Market Research Market Targeting How do I perform Marketing? By establishing just this: Objectives Strategic focus Target clients Competitive issues Differential advantages The Marketing Mix

Implementation Sales Management and control

The management process responsible for identifying, anticipating and profitably satisfying customer requirements. All those activities concerned with the definition, production, distribution and consumption of a product or service. On the Nature of Selling A process of communication aimed at establishing a prospect or clients perceived needs and translating them into wants for your product or service.

On the Process of Selling Initial requirements for selling 1. Ability to negotiate at high level 2. Territory management 3. Understanding of market requirements and corporate skills 4. Full use of relevant technical support

Target Marketing involves breaking a market into segments and then concentrating your marketing efforts on one or a few key segments. Target marketing can be the key to a small businesss success. The beauty of target marketing is that it makes the promotion, pricing and distribution of your products and/or services easier and more cost-effective. Target marketing provides a focus to all of your marketing activities. So if, for instance, I open a catering business offering catering services in the clients home, instead of advertising with a newspaper insert that goes out to everyone, I could target my market with a direct mail campaign that went only to particular residents.

While market segmentation can be done in many ways, depending on how you want to slice up the pie, three of the most common types are: Geographic segmentation based on location such as home addresses; y Demographic segmentation based on measurable statistics, such as age or income; y Psychographic segmentation based on lifestyle preferences, such as being urban dwellers or pet lovers. If youre interested in target marketing, the first step is to do the research that will help you define and zero in on your target market. How to Find and Sell to Your Target Marketwill help you get started.
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Also Known As: Niche marketing. Common Misspellings: Targit marketing, target markiting. Examples: The target marketing example above is an example of how demographic market segmentation could be used

Segmentation General Articles How to Segment Your Market by Business Owner's Toolkit. A brief primer on market segmentation that includes definitions of related terms, such as demographics and psychographics, how larger companies conduct segmentation research and practical cost-effective approaches smaller companies can use to segment their markets. Niche Marketing by Business Owner's Toolkit. Strategies for identifying and marketing

to your "heavy users"who spend much more on your products than average customers, including the potential impact of competitors and what it takes to be profitable with this customer segment.

Specific Market Segments Note: The groups profiled below were selected based on available online articles, not any priorities for covering one group over another!
Mature Age Groups

Targeting the Mature Market: Breaking Down BarriersStrategies for targeting 50+ customers are discussed, including further segmentation of the senior market based on activity level, discretionary time and other factors.
Young Age Groups

The Spending Power of Tweens Tweens are defined as being those in the age ranges of 8-9 and 12-13. Their influence on their parents' purchases is primarily in the areas of food, fashion, entertainment, and big-ticket items, but their reach can also extend to items like mobile phones and cars. Marketing Golf to Generation X by Marcus Whelan, Cyber-Journal of Sports Marketing. The first part of this article analyzes Generation X (born between 1961 and 1981), including their distinguishing characteristics, how they differ from baby

boomers and how they process buying decisions. Additional insights about this generation are included in the balance of the article, which focuses on selling them golf equipment. Hip Check by Jennifer Lach, American Demographics, March, 1999. This case study reviews how Lee Apparel increased sales of its jeans to 15-to-34-year-oldsa group that had negative perceptions about wearing Lee jeans. Clothes Make the Teen by Wayne D'Orio, American Demographics, March, 1999. How consumer product companies are collaborating with film and TV production companies to reach teen audiences. Among the many examples covered: Tommy Hilfiger and the movie, "The Faculty," Ray-Ban sunglasses and "Men in Black," and J. Crew clothing and the WB network show, "Dawson Creek."
Hispanics

The Wonderful and Lucrative Enigma of the Hispanic Teensby Juan Faura, Cheskin Research, March, 1999. The article explores the challenges of understanding and reaching this market segment and Hispanic teens' growing role in setting fashion trends in their age group. From Bland to Brand by Jennifer Lach, American Demographics,March, 1999. This case study explores how FritoLay increased sales to Hispanics, who were "less likely to eat 'salty snacks' than the general market." It covers how focus groups were used to uncover current perceptions, the tactics used to build interest and the results of Frito-Lay's efforts.

Upscale Customers

Kroger Takes Separate Roads to the Internet Kroger is still seeking ways to take advantage of the Internet to reach consumers.
Psychographic Segmentation

VALS by SRI Consulting. The company provides examples of how psychographic segmentation has been successful used in such areas as product introduction, product repositioning and targeted direct mail campaigns. Demographics Data Demographics Data by USAData.com. Demographics for approximately 60 US metropolitan areas: population distribution and percentages by gender, age, household income, education, marital status, race, ethnicity, full-time employment and home ownership.

Marketing Strategy - Differentiating and Positioning the Market Offering

Marketing Management Article Series Philip Kotler discussed marketing strategy in 5 chapters. This knol describes differentiating and positioning. Contents

  

i Marketing Strategy Tools for Competitive Differentiation

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Five Dimensions of Differentiation Services differentiation Which differences to promote:

Related Articles For Searching Knol Site For Browsing More Interesting Knols: Directory - Main Categories

Marketing Strategy

Philip Kotler discussed five issues of marketing strategy in his 9th edition of Marketing Management

Differentiating and Positioning the Market Offering Developing New Products Managing Life cycle Strategies Designing marketing Strategies for Market Leaders, Challengers, Followers, and Niches Designing and Managing Global Marketing Strategies

These issues are covered in different knols by me. (Author's personal note: Management Theory Revision, a new blog will have all the management articles published by me on Knol and will be come MBA Revision Guidebook, the project that I started on Knol) This knol describes differentiating and positioning.

Differentiating and Positioning the Market Offering

The issues discussed in the area of differentiating and Positioning the market offering are:
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Tools for Competitive Differentiation Developing a Positioning Strategy

Communicating the Companys Positioning

Tools for Competitive Differentiation

Differentiation - Definition: is the act of designing a set of meaningful differences to distinguish the company's offering from competitor's offerings.

Boston Consulting Group's differentiation opportunities matrix: Actually it is a competitive advantage matrix applicable to differentiation opportunities.

Four types of industries identified by BCG matrix are:

Volume industry: only a few but very large competitive advantages are possible. The benefit of the advantage is proportional with company size and market share. Example given - construction industry

Stalemated industry: in this type there are only few opportunities and the benefit from each is small. The benefit is also not proportional to the size or market share. Example: Steel industry - It is hard to differentiate the product or decrease its manufacturing cost.

Fragmented industry: in this type, there are many opportunities, but the benefit of each of them is small. Benefit does not depend on size or market share.

Specialized industry: in this type, the opportunities are more and benefit of each opportunity is high. The benefit is not related to size or market share.

Kotler mentions, Milind Lele's observation that companies differ in their potential maneuverability along five dimensions: their target market, product, place (channels), promotion, and price. The freedom of maneuver is affected by the industry structure and the firm's position in the industry. For each potential competitive opportunity or option limited by the maneuverability, the company needs to estimate the return. Those opportunities that promise the highest return define the company's strategic leverage. The concept of maneuverability brings out the fact that a strategic option that worked very well in one industry may not work equally well in the other industry because of low maneuverability of that option in the different industry and by the firm in consideration.

Five Dimensions of Differentiation

Regarding the tools of differentiation, five dimensions can be utilized to provide differentiation. Product Services that accompany marketing, sales and after sales services. Personnel that interact with the customer Channel Image

Differentiating a Product

Features Quality: performance and conformance

Performance - the performance of the prototype or the exhibited sample, Conformance - The performance of every item made by the company under the same specification

Durability Reliability Repairability Style Design

Services differentiation

Ordering ease Delivery Installation Customer training Customer consulting Miscellaneous services

Personnel Differentiation

Competence Courtesy Credibility Reliability Responsiveness Communication

Channel differentiation

Coverage Expertise of the channel managers Performance of the channel in ease of ordering, and service, and personnel

Image differentiation

First distinction between Identity and Image - Identity is designed by the company and through its various actions company tries to make it known to the market. Image is the understanding and view of the market about the company. An effective image does three things for a product or company. 1. It establishes the product's planned character and value proposition. 2. It distinguishes the product from competing products. 3. It delivers emotional power and stirs the hearts as well as the minds of buyers.

The identity of the company or product is communicated to the market by Symbols Written and audiovisual media Atmosphere of the physical place with which customer comes into contact Events organized or sponsored by the company.

Developing a Positioning Strategy

Levitt and others have pointed out dozens of ways to differentiate an offering(Theodore Levitt: "Marketing success through differentiation-of anything", Harvard Business Review, Jan-Feb, 1980) While a company can create many differences, each difference created has a cost as well as consumer benefit. A difference is worth establishing when the benefit exceeds the cost. More generally, a difference is worth establishing to the extent that it satisfies the following criteria.

Important: The difference delivers a highly valued benefit to a sufficient number of buyers. Distinctive: The difference either isn't offered by others or is offered in a more distinctive way by the company. Superior: The difference is superior to the ways of obtaining the same benefit. Communicable: The difference is communicable and visible to the buyers. Preemptive: The difference cannot be easily copied by competitors. Affordable: The buyer can afford to pay the higher price Profitable: The Company will make profit by introducing the difference.

Positioning

Positioning is the result of differentiation decisions. It is the act of designing the company's offering and identity (that will create a planned image) so that they occupy a meaningful and distinct competitive position in the target customer's minds.

The end result of positioning is the creation of a market-focused value proposition, a simple clear statement of why the target market should buy the product. Example:

Volvo (station wagon) Target customer-Safety conscious upscale families, Benefit - Durability and Safety, Price - 20% premium, Value proposition - The safest, most durable wagon in which your family can ride.

How many differences to promote?

Many marketers advocate promoting only one benefit in the market (Your market offering may have many differentiators, actually should have many differentiators in product, service, personnel, channel, and image).

Kotler mentions that double benefit promotion may be necessary, if some more firms claim to be best on the same attribute. Kotler gives the example of Volvo, which says and "safest" and "durable".

Four major positioning errors

1. Underpositioning: Market only has a vague idea of the product. 2. Overpositioning: Only a narrow group of customers identify with the product. 3. Confused positioning: Buyers have a confused image of the product as it claims too many benefits or it changes the claim too often. 4. Doubtful positioning: Buyers find it difficult to believe the brand s claims in view of the product s features, price, or manufacturer.

Different positioning strategies or themes

1. Attribute positioning: The message highlights one or two of the attributes of the product. 2. Benefit positioning: The message highlights one or two of the benefits to the customer. 3. Use/application positioning: Claim the product as best for some application. 4. User positioning: Claim the product as best for a group of users. - Children, women, working women etc. 5. Competitor positioning: Claim that the product is better than a competitor. 6. Product category positioning: Claim as the best in a product category Ex: Mutual fund ranks Lipper. 7. Quality/Price positioning: Claim best value for price

Which differences to promote:

This issue is related to the discussion of worthwhile differences to incorporate into the market offering done earlier. But now competitors positioning also needs to be considered to highlight one or two exclusive benefits offered by the product under consideration.

Positioning and Differentiation of Services

Definition Positioning Value Differentiation Role of Positioning in Marketing Strategy Steps in Developing a Positioning strategy Determining Identification Location Evaluating Implementing the Position Levels of of Attributes Positioning on Positioning of Positioning Attributes Map Options and Chain in Concept Strategies Services

Chapter Summary
After the logical step of segmenting and targeting the market, a company should position itself in the minds of customers for its unique attributes, as compared to its competitors. Positioning a service is difficult as compared to products because services are intangible in nature. However, a company should identify a competitive position for itself in the market, by differentiating itself from the competitors. Further, a company should add value to its services by improving either its primary activities which consist of inbound logistics, operations, outbound logistics, marketing and sales, and service or its support activities which include the procurement processes, infrastructure of a firm, its human resource management, and the technology development. These interdependent and interrelated activities, together contribute to the margin that the company aims to earn. This concept of a value chain has helped organizations identify their core and non-core activities so that some of them can be outsourced. The firm's strengths help the firm gain either a cost advantage or a differential advantage over its competitors. To gain a competitive advantage, a company should differentiate itself from its competitors based on the attributes that are important, distinct, communicable, superior, preemptive, affordable and profitable to the customers. Further, companies should understand the importance of positioning in developing a marketing strategy and its influence on the profit margins of a particular company. This understanding will help a firm in framing a suitable positioning strategy. As part of the positioning strategy, a company should first determine the levels of positioning it wants to occupy in the market, identify the attributes that are important to the target market, and locate these attributes on the positioning map in relation to its customers. Further, it should evaluate the positioning options available and decide if it wants to position itself against its competitor, or occupy a unique position in the market, or reposition itself. Last, it should opt for a good implementation strategy that clearly communicates the desired position to its customers.