Consumers' perceptions of products and brands are influenced by the marketing and promotional plan. Marketers must identify the key characteristics that are important to the target market and then ensure that their product stands out in the minds of the consumers as the best choice for purchase.
Two college students walk into an auto show because they both need to buy their first car with the savings they have amassed through part time jobs. Every car manufacturer has their cars available for the students to examine and sit in. Both students have an image in their mind of the type of car they want to purchase: cool, fun, inexpensive, and reliable. Most car makers realize that the younger demographic has different car needs than the other target markets.
Car makers will position their affordable starter cars as having those attributes. A position is the place a product, company, or brand occupies in consumers' minds relative to the competition's offerings. Positioning is a process that affects potential customers' perception of a brand, product, or company. It is very important for marketers to realize that you can position a product in any manner that you want, but it does not ensure that the customer will see the product the way it is marketed.
How consumers perceive a brand affects product positioning
For example, defunct car manufacturer Oldsmobile tried to make their cars cool again. They developed new car designs and came up with the slogan, 'It is not your father's Oldsmobile.' No matter what the marketers tried to position their product as attractive to the younger generation, the process failed. Younger consumers could not get the image of older people driving large Oldsmobiles around town, and to them it still made the product unattractive.
Positioning does assume that consumers are comparing products based on similar characteristics. Marketers must know what characteristics are important to their key target markets, and then position their product to fit those requirements. Our college student car shoppers have decided on fun, cool, innovative, and affordable as their key purchasing characteristics. The brands that advertise these types of cars would be Kia, Scion, and Subaru. These car manufacturers have positioned their cars as fun, cool, and affordable.
For example, the Kia Soul has a very creative ad campaign that uses the 'Party Rock Anthem' and a bunch of hip-hop hamsters to position the car as cool. The company also offers an iPad app for the Soul. This use of carving a niche for a product (in this instance a car for young drivers) requires the use of product differentiation. This is a type of positioning strategy that Kia is using to distinguish their cars from the competitor's in the market place. Kia wants the young driver target market to view that their car has features and offers much more than any of the competition.
Sometimes marketers need to grasp exactly where all of the competitors in the market place are viewed by consumers. A graphical way of representing two or more dimensions or variables that are represented in customers' minds is called perceptual mapping. These dimensions can be used by product use, price, quality or attribute.
Perceptual Mapping Example
For example, the local diner has spent over $400,000 adding a bar and sports club to its facility. The diner would like for consumers to now view their business as an upscale, club/bar place for dinner and not just a place to get breakfast. They have created a perceptual map that shows all of the local dining establishments based on the criteria dimensions of classy/distinctive through affordable on the x-axis and everyday through special occasion on the y-axis. Through the use of marketing research, the diner was able to get information from the town's consumers on where they would place the dining establishment on the matrix.
It turned out that the diner was ranked low on the x near affordable and close to an everyday place of dining. The marketing team knew that they had to create a new marketing program to educate their target market about the changes to the diner and hopefully also change the perception of the diner in the consumers' minds. The marketing team wants their new diner renovation to move the diner into an area on the map with other dining establishments that offer a more expensive menu and fun, classier atmosphere. This is called repositioning.
The diner marketing team wants to reposition or change consumers' perceptions of their diner in relation to the competition. There are some basic ways the team can accomplish this task. It is important that they have an effective marketing strategy that communicates the change of the diner. The message should be about the increase in menu prices due to the classier food offerings. The addition of the club, bar, and alcohol offerings should be promoted by free appetizers, drink specials, ladies' nights, and other club discount nights. There will be some loss in customers who frequented the diner to early bird specials and breakfast if the diner does not communicate that they will still offer traditional menu items (although with a pricier cost).
Many companies try and reposition their product offerings, but some are not successful, like Oldsmobile. Cadillac is another company that recently was successful in repositioning their cars. Through innovative designs and an excellent marketing program, they were able to reposition their product offerings as high tech, luxury, and modern.
Consumers' perceptions of products and brands are influenced by the marketing and promotional plan. Marketers must identify the key characteristics that are important to the target market and then ensure that their product stands out in the minds of the consumers as the best choice for purchase. Product differentiation is a positioning strategy that allows marketers to create distinction of their product offerings in the minds of their target market. Positioning of a product is the process that influences consumers' perception of the product and will lead to consideration for purchase in the competitive set.
After watching this lesson, you should be able to understand and explain positioning and product differentiation in the marketing and promotional plan.