PRODUCT

DIFFERENTIATION
&
POSITIONING

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 DIFFERENTIATION

The act of designing a set of

meaningful differences to
distinguish the company’s
offering from competitors’
offerings.

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Differentiation Variables

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 All products can be differentiated to some extent. But not all brand differences
are meaningful or worthwhile. 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 is delivered in a distinctive way.
 Superior: The difference is superior to other ways of obtaining the benefit.
 Preemptive: The difference cannot be copied easily by competitors.
 Affordable: The buyer can afford to pay for the difference.
 Profitable: The company will find it profitable to introduce the difference.

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 Multiple sources of
Differentiation
Eureka Forbes used personal selling as
the sole mean to reach consumers, IBM
differentiated along technology, Coke &
Pepsi differentiated through brand
power, Rolls Royce through superior
engineering, DuPont’s leadership in
chemical technology etc.

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Tangible Product Attributes
 Differentiation Based on Ingredients/formula
Example: Close Up Gel Toothpaste, TTK Prestige Teflon, Promise
with clove oil, New Ariel Microshine with Carezyme.
 Differentiation Based on Functional Value
Example: 3M Scotch Magic Tape, Computer controlled fridge
 Differentiation based on additional features
Example: Aristocrat suitcase with wheels, Dunlop Olympus
 Packaging contributing to differentiation
Example: Frooti Tetrapack, Harpic Toilet Cleaner
 Differentiation through product design
Kinetic Honda Electronic Ignition, Titan Watches
 Differentiation based on quality
Example: Godrej Steel Cupboards

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 Intangible Characteristics and
Emotional Associations
 Jo biwi se kare pyar wo prestige se kaise
kare inkar
 Reid & Taylor
 Rayban

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 POSITIONING
 Southwest Airlines - Low cost carrier
 Funskool - Safety, variety & education
 Tata Salt - Iodized salt(1983) - Desk ka namak(2002)
 Captain Cook (1990) - Free Flowing
 Peter England - Honest Shirt(1997) - Honestly Impressive(2002)
 Reid & Taylor (1998) - Luxury Suitings
 Innova-(Qualis) - Spacious, trendy &Upmarket
 Pepsodent (1993) - Long lasting protection for hours after brushing-Germ
Fighting Property
 Woodland - Rugged High Quality Premium Casual Shoe
 Vicks - Mothers Love Platform-”Touch Therapy”

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 SURF EXCEL
 Dag Ache Hain
This campaign has a huge significance It
says:
It is ok to soil your cloths
It is ok to play in the mud
It is ok to enjoy life
Surf Excel hai na!!!!!!!!!!!!!!
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Define Positioning….
Act of designing the company’s
offering and image to occupy a
distinctive place in the mind of the
target market.

“Positioning starts with a product. A

piece of merchandise, a service, a
company, an institution, or even a
person. . . . But positioning is not what
you do to a product. Positioning is
what you do to the mind of the
prospect. That is, you position the
product in the mind of the prospect.”
-Al Ries and Jack Trout 19-11
 Developing a positioning
strategy
 Developing a positioning strategy depends much on
how competitors position themselves. Do organisations
want to develop ‘a me too’ strategy and position
themselves close to their competitors so consumers can
make a direct comparison when they purchase?

 Or does the organisation want to develop a strategy

which positions themselves away from their
competitors? Offering a benefit which is superior
depends much on the marketing mix strategy the
organisation adopts.

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 How Many Differences to
Promote?
 Each company must decide how many differences (e.g., benefits,
features) to promote. Ries and Trout favor one consistent positioning
message. With this approach, each brand is touted as “number one”
on a particular attribute, such as “best quality,” “best service,” “lowest
price,” or “most advanced technology.” If a company hammers away
at one positioning and delivers on it, it will probably be best known
and recalled for this strength.

 Not everyone sticks to single-benefit positioning. Smith Kline

Beecham promotes its Aquafresh toothpaste as offering three benefits:
anticavity protection, better breath, and whiter teeth. The company’s
challenge is to convince consumers that the brand delivers all three.
Smith Kline’s solution was to create a toothpaste that squeezes out of
the tube in three colors, thus visually confirming the three benefits.

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Six basic strategies for product
positioning

 By attribute or benefit
This is the most frequently used positioning
strategy. For a light beer, it might be that it
tastes great or that it is less filling. For
toothpaste, it might be the mint taste or
tartar control.
Example: Vediocon Picture-in-picture
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 By use or application
The users of Apple
computers can design
and use graphics more
easily than with Windows
or UNIX. Apple positions
its computers based on
how the computer will be
used.
Example: Vicks, Rasna
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 By user
Facebook is a social networking site used
exclusively by college students. Facebook
is too cool for MySpace and serves a
smaller, more sophisticated cohort. Only
college students may participate with
their campus e-mail IDs.
Example: Raymonds Vijapat inghania
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 By product or service class
Margarine competes as an alternative to butter.
Margarine is positioned as a lower cost and
healthier alternative to butter, while butter
provides better taste and wholesome
ingredients.
Example: Maggie, the two minute noodle
Domino’s, A good hot pizza, delivered to your
door within 30 minutes of ordering, at a
moderate price
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 By competitor
BMW and Mercedes often compare themselves to each other
segmenting the market to just the crème de la crème of the
automobile market. Ford and Chevy need not apply.

Example: If a brand is not number one, then to

be successful it somehow must relate itself to
the number one brand. Avis tried
unsuccessfully for years to win customers,
pretending that the number one Hertz did not
exist. Finally, it began using the line:

"Avis in only No. 2 in rent-a-cars, so why go

with us? We try harder."

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 By price or quality
Tiffany and Costco both sell diamonds.
Tiffany wants us to believe that their
diamonds are of the highest quality,
while Costco tells us that diamonds are
diamonds and that only a chump will pay
Tiffany prices.
Examle: Karsanbhai Patel’s Nirma

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 Positioning by product class dissociation
Example: soft-drink 7-Up, which was No.
3 behind Coke and Pepsi. By relating
itself to Coke and Pepsi as the "Uncola",
7-Up was able to establish itself in the
mind of the consumer as a desirable
alternative to the standard colas.

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 Defining Associations
Points-of-difference (PODs) Points-of-parity (POPs)
 Attributes or benefits  Associations that are not
consumers strongly
necessarily unique to
associate with a brand,
positively evaluate, and the brand but may be
believe they could not find shared with other brands
to the same extent with a
competitive brand

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 Positioning Statement
 Also referred to as a brand strategy, positioning strategy, or brand
positioning statement, a positioning statement is a succinct description of
the core target audience to whom a brand is directed, and a compelling
picture of how the marketer wants them to view the brand.
 There are four elements or components of a positioning statement:
Target Audience - the attitudinal and demographic description of the core
prospect to whom the brand is intended to appeal
Frame of Reference - the category in which the brand competes
Benefit/Point of Difference - the most compelling and motivating benefit
that the brand can own in the hearts and minds of consumers relative to
the competition
Reason to Believe - the proof that the brand delivers what it promises
 Template for a Positioning Statement:
For (target audience), (brand name) is the (frame of reference) that delivers
(benefit/point of difference) because only (brand name) is reason to believe).

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