Positioning Services in Competitve Markets

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    P OSITIONING SERVICES INCOMPETITVE MARKETS

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    COMPLETE POSITIONINGSTRATEGY FOR SERVICES

    Intensifying competition

    Must be selective intargeting customers

    focus efforts on

    customers it can servebest

    Emphasize competitiveadvantage

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    B ASIC FOCUS STRATEGIES FORSERVICES

    BREADTH OF SERVICE OFFERINGS

    Narrow

    Many

    Few

    Wide

    ServiceFocused

    Unfocused(Everythingfor everyone)

    MarketFocused

    Fully Focused

    (Service andmarketfocused)

    NUMBER OFMARKETSSERVED

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    RISKS AND OPPORTUNITIES OF AFULLY FOCUSED STRATEGY

    O pportunities

    Developing recognized expertise in a well-defined nichemay provide protection against would-be competitors

    Allows firms to charge premium prices

    Risks

    Market may be too small to generate needed volume of business

    Demand for a service may be displaced by genericcompetition from alternative products

    Purchasers in chosen segment may be susceptible toeconomic downturn

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    THE KEY CONCEPTS OF MARKETINGP OSITIONING STRATEGY

    FORMULATION

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    A business must set itself apart from itscompetition. To be successful it must identify and promote itself as the best provider of attributes that are important to target customers

    George S. Day

    Co-Director of the Mack Center for Technological Innovation at the WhartonSchool of the University of Pennsylvania

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    Targeting PositioningSegmentation

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    ESTAB LISHING SERVICELEVELS AND T IERS

    N eed to make decisions on servicelevels level of performance firm

    plans to offer on each attribute

    Can often segment customersaccording to willingness to trade off price versus service level

    Service tier-ing: Positioning strategybased on offering several price-basedclasses of service concept

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    FOUR P RINCIPLES OFP OSITIONING STRATEGY

    Must establish position for firm or product in minds of customers

    Position should be distinctive, providing one simple,consistent message

    Position must set firm/product apart from competitors

    A company cannot be all things to all people must focusits efforts

    Jack TroutAu thor

    The New Positioning

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    P RODUCT P OSITIONING VERSUSCOPY P OSITIONING

    Positioning often associated with communication mix,notably advertising, promotion, PR

    Copy PositioningUse of imagery to differentiate and add glamour toservicesSome slogans promise a specific benefit to makecompany stand out from competitors

    Growing number of firms engage in co-branding, for

    example:Jointly offered credit card by American Airlines, Citibank,and Visa

    Positioning guides firm to marketing strategydevelopment

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    MARKET, I NTERNAL, ANDCOMPETITOR ANALYSIS

    S ource: Developed from an earlier schematic by Michael R. Pearce

    - Size- Composition- Location- Trends

    MarketingActionPlan

    MARKETANALYSIS

    INTERNALANALYSIS

    - Resources- Reputation- Constraints- Values

    COMPETITOR ANALYSIS

    - Strengths- Weaknesses- Current

    Positioning

    Define, AnalyzeMarket Segments

    SelectTarget SegmentsTo Serve

    ArticulateDesired Positionin Market

    Select Benefitsto Emphasizeto Customers

    AnalyzePossibilities forDifferentiation

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    USING P OSITIONING MAPS TOP LOT COMPETITIVE STRATEGY

    Useful way to represent consumer perceptions

    Typically confined to two attributes, but 3-D models canbe used to portray positions on three attributessimultaneously

    Information about a product can be obtained frommarket data

    If consumer perceptions of service characteristics differsharply from "reality" as defined by management, thenmarketing efforts may be needed to change theseperceptions

    Also known as p erce p t u al ma p s

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    P OSITIONING OF HOTELS :P RICE VERSUS SERVICE LEVEL

    Expensive

    Shangri-LaH igh

    ServiceModerateService

    Grand

    Regency

    Sheraton

    Italia

    CastleAlexander IV

    Airport Plaza

    PALACE

    Atlantic

    Less Expensive

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    P OSITIONING MAPS HELPMANAGERS TO VISUALIZE STRATEGY

    Display relative performance of competing firms

    Research provides inputs to development of positioning maps challenge is to ensure that

    Attributes important to target segmentsaccurately reflects perceptions of customers

    Position development in the future

    Simple graphic representationsVisual awakening to threats and opportunities

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    REPOSITIONING

    Positions evolve in response to changingmarket structures, technology, competitiveactivity, and the nature of firm itself Firm may have to make significant change inexisting position

    Improving negative brand perceptions mayrequire extensive redesign

    Repositioning introduces new dimensionsthat other firms cannot immediately match

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    VODAFONE P OSITIONING

    W here you go thenetwork follows you

    Hutch as a brand tried toconnect with consumers ina simple,honest and realmanner , while Vodafone is

    a more young and funbrand.so consumers willsee a shift reflecting amore vibrant brand

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    18/18THANK YOU