Reading: Developing Positioning Statements
A Simple Formula
A positioning statement is one sentence that succinctly identifies the target market and spells out what you want them to think about your brand. This statement should include five elements:
- the target segment
- the brand name
- the product/service category or frame of reference in which you are establishing this market position
- the key points of differentiation
- 5the reasons customers should believe the positioning claims.
The brand consultancy EquiBrand recommends the following straightforward formula for writing positioning statements:
To [target audience], Product X is the only [category or frame of reference] that [points of differentiation/benefits delivered] because [reasons to believe].[1]
The parts of the formula supplied by you (the marketer) are as follows:
- The “target audience” is a brief description of the segment you’re targeting with this positioning strategy. For example: young urban males, managing partners in law firms, or small business owners in the Pacific Northwest.
- “Product X” is your product, service, or brand name.
- The “Category or frame of reference” is the category of products or services you’re competing in. For instance: spectator sporting events, virtual assistant services, or employer pension plan.
- The “points of differentiation/benefits delivered” explains both what problem you solve and how you solve it in a different and better way than competitors. It highlights the competitive advantage(s) underpinning your positioning strategy. Be sure to explain not just what is different about you, but why customers care about that difference.
- The “reasons to believe” are any proof points or evidence that show your customers how you live up to your claims about how you are different and better.
Let’s look at some examples of well-written positioning statements:
H & R Block continues to ask “Who is doing your taxes?” but has evolved their campaign positioning in 2019 to shift to who SHOULD be doing your taxes, under their umbrella theme of “Get what’s yours?”. [3]
Amazon (circa 2001, when it sold primarily books)
For World Wide Web users who enjoy books, Amazon is a retail bookseller that provides instant access to over 1.1 million books. Unlike traditional book retailers, Amazon provides a combination of extraordinary convenience, low prices and comprehensive selection.[4]
Source: Lumen Learning. Developing Positioning Statements, in Module 8. Lumen Publishing. (2016). Principles of Marketing. https://courses.lumenlearning.com/waymakerintromarketingxmasterfall2016/chapter/reading-developing-positioning-statements/
This clearly worded positioning statement follows the formula closely, even though the “reasons to believe” are added as a second sentence. It presents the competitive advantage (“instant access to over 1.1 million books“) as a clear differentiator, and with this wording we also understand the problem Amazon solves–convenient access to lots of books. The specific reasons to believe are highly desirable benefits for the target audience.
Amazon (circa 2019, largest logistics company in the world)
Amazon’s positioning statement
“Our vision is to be the earth’s most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online.”
Source: Lumen Learning. Developing Positioning Statements, in Module 8. Lumen Publishing. (2016). Principles of Marketing. https://courses.lumenlearning.com/waymakerintromarketingxmasterfall2016/chapter/reading-developing-positioning-statements/
Positioning statements change as companies evolve as Amazon demonstrates. We will examine repositioning later in the chapter.
Here are a few more examples of different brand positioning.
Tide Laundry Detergent
Tide is the brand of laundry detergent that gets clothes their cleanest and keeps them looking new because “improved” Tide formulation powers out stains while keeping clothes from fading and fraying for the best value for families. [5]
Source: Lumen Learning. Developing Positioning Statements, in Module 8. Lumen Publishing. (2016). Principles of Marketing. https://courses.lumenlearning.com/waymakerintromarketingxmasterfall2016/chapter/reading-developing-positioning-statements/
The Tide positioning statement identifies the target audience so specifically that it’s easy to create a vivid mental picture of the customer. The problem Tide solves is very clear: getting close clean. This statement emphasizes the product’s competitive advantage around cleaning power and superior formulation, while promising valued benefits that customers enjoy when they use this product.
The onus here is on the brand to provide these concrete benefits around not “fading and fraying,” but these are definite reasons to believe if indeed the product can deliver and a reason to believe.
Evaluating Positioning Statements
How do you know when a positioning statement is going to be effective? Obviously, positioning statements should contain all the elements in the formula above, since that information is needed to translate the positioning strategy into a well-developed marketing mix. There are other criteria you should look for, as well. For example, the following:
- Is it tailored to the target market? Too often, positioning statements either leave out the target segment, or else the entire approach isn’t really suited to that unique group. If a positioning statement would work just as well if you plugged in a completely different target segment, then you probably haven’t thought deeply enough about your target’s unique needs and what will make them want your product. Or, you’ve defined your target segment too narrowly, in which case you should revisit whom you’re trying to reach.
- Is it simple, focused, and memorable? A positioning statement that is overly complex will be hard to execute against because it isn’t focused enough to deliver a clear message to the customer. Make sure it is very clear what problem(s) you solve. Use easy-to-understand words instead of jargon that muddles the meaning. If your statement is running long, consider trimming a few differentiators or benefits. It’s actually very good to prune down to the essentials so your meaning is crystal clear. Make every word count!
- Does it provide an unmistakable picture of your product, service, or brand? Your positioning statement should work beautifully for you, but not very well for your competitors. If you can substitute any competitor’s name for your own in the positioning statement—and it still sounds credible—then you need some additional work on your differentiators and competitive advantages. If you are going to own your market niche, it must be a place that no one else can easily occupy.
- Can you deliver on the promise you make? The positioning statement promises some benefits or outcomes to your customers. You must be able to consistently live up to this promise—otherwise you’ll lose credibility, and your offering will stand for something that’s untrustworthy. If you can’t live up to your promise, you need to take another, more realistic look at the offering’s benefits and the customers’ reasons to believe.
- Does it provide helpful direction for designing the marketing mix and other decisions? From the positioning statement, you should have a sense of what types of activities and messages are consistent with that positioning and support the brand you are working to build.
Practice: Evaluate These Statements
Read the following statements. For each one, ask yourself whether it’s a strong positioning statement based on the formula and criteria outlined in this reading. Why or why not?
- Nike brings inspiration and innovation to every athlete in the world.[6]
- For taxpayers, H&R Block (https://www.hrblock.ca/) offers the best tools and tax professionals to examine their lives through taxes and find ways to help them save time and money.[7]
- For shoppers, HBC’s assortment selection makes it the shopping destination for exciting and stylish brands Canadians cannot get anywhere else. (insert footnote)
Analysis: Here is how these examples stack up:
- Nike: This is a powerful mission statement, and it sets a perfect tone for the Nike brand. However, it is not an effective positioning statement because it doesn’t really articulate any points of differentiation, problems solved or reasons to believe.
- H&R Block: This is an exemplary positioning statement, including each element of the formula in clear, concise terms. What’s memorable and unexpected about this statement is how it humanizes tax preparation services by presenting them as services that “examine your life” and “find ways to help.” There is room for improvement: it’s arguable whether “taxpayers” is too broad as a target segment. But overall, this is a great example.
- HBC: This example exhibits a couple of obvious weaknesses as a positioning statement. As a segment, “shoppers” is too broad. Surely HBC has more detailed information about its target segments and what they want. This statement discusses features (“exciting and stylish brands”) but it does not mention any customer benefits. Positioning statements definitely need benefits–and reasons to believe. See HBC’s company info. (http://www3.hbc.com/hbc/about-us/)
- http://equibrandconsulting.com/templates/positioning-templates ↵
- Source: equibrand.com ↵
- https://strategyonline.ca/2020/03/04/hr-block-makes-its-expertise-more-explicit/ ↵
- http://www.fastcompany.com/3034721/hit-the-ground-running/figuring-out-the-delicate-art-of-positioning-your-startup ↵
- https://books.google.com/books?id=zEGhBgAAQBAJ, p. 115 ↵
- http://help-en-us.nike.com/app/answers/detail/a_id/113/~/nike-mission-statement ↵
- https://www.hrblock.com/corporate/our-company/ ↵
