Brand Positioning: Strategy Guides for Knowing Your Value
For any startup business, the number of decisions that must be made can seem endless. After the initial decisions that can include the company name and product offerings, you must then decide on a brand positioning strategy. This single decision can have significant consequences on the way the business operates, how much capital is needed, and which consumers are a likely target. To decide which brand position is right for your company, you'll first want to understand its unique selling proposition. Consider some of the following positioning strategies to help you determine which best aligns with the value offered by your company.
Businesses with this brand positioning strategy will focus on lean operations and logistical effectiveness. Brands in this category provide a suitable product at a lower price than their competitors, and provide cost savings to price-conscious consumers.
One of the most notable example of a cost leader is Wal-Mart. The brand that offers "Always Low Prices. Always." uses its brand positioning to get customers returning on a daily basis to its thousands of retail locations nationwide. How has Wal-Mart succeeded with this strategy? The retail giant consistently focuses on maintaining its cost structure at every opportunity. Wal-Mart understands that its price-sensitive customers are looking for bargains, so it focuses on negotiating rock bottom prices with suppliers, investing heavily in its own trucking line for better logistical control, and making the cost savings readily apparent throughout its stores with bright blue signs portraying yellow smiling faces.
If your brand is ready to compete on the field of price, consider taking the following action steps to solidify your position as a cost leader in your industry:
- Negotiate cost savings terms with suppliers and transportation teams
- Offer coupons and discounts regularly
- Compare your prices to those of similar, yet higher priced, competitors
- Develop an easy-to-understand pricing model that allows consumers to quickly identify cost savings
If your startup is focused on being customer-centric, you might decide to follow a service leader brand positioning strategy. A strong customer service focus is a main value for these brands, but not the only one. Flexibility with warranties, returns, and guarantees are all important aspects to show customers that you stand by your product and support them if and when something goes wrong.
A nationally recognized example of a service leader you may be familiar with is Chik-fil-A. This brand maintains an elite standard for its employees at every location and has built a reputation for being a high-quality fast food restaurant. While the quality of their food may not be much different than that of other fast food options, the quality of their service may be what sets them apart. Chik-fil-A has focused on improving counter and drive-thru service times, and employees are professional and friendly.
Chik-fil-A also frequently offers free sandwich coupons, but they’re used strategically, as promotional giveaways for school reward programs or fundraising efforts. Local customers often view such a discount as a generous effort that instills community support.
If your brand is ready to compete on the field of service, consider taking the following actions to solidify your position as a service leader in your industry:
- Invest in well-trained, knowledgeable employees
- Offer warranties, returns, and guarantees that will instill confidence in the product
- Evaluate your product offerings to ensure they live up to any guarantees
- Be strategic about whether your company uses coupons or discounts
If your startup is well-funded and offers new products regularly, an innovation leader strategy may be the best fit. Companies identifying as "innovation leaders" often invest heavily in research and development, and have a clear profile of their target customer. Customers who flock to these brands tend to be early adopters; these consumers want the latest technology as soon as it is available and are willing to pay a premium to get it.
Apple has consistently implemented an innovation leader strategy and has reaped significant rewards in profitability from it. The company's famed retail stores give consumers a chance to interact with the latest gadgets, which aids in the excitement surrounding a purchase decision. Apple also invests heavily in television and in-store advertising well in advance of each new product release, and even employs "hype" YouTube videos to further entice tech-savvy consumers.
With this extensive investment in advertising and new product development, Apple devices come with a hefty price tag. But due to this intentional brand positioning strategy, consumers are willing to pay it. Apple also recognizes that it must consistently stay ahead of competitors on the latest advances in technology. Failure to do so could result in a major shift in the company's core target audience.
If your brand is ready to compete on the field of innovation, consider taking the following steps to solidify your position as an innovation leader in your industry:
- Invest in product development regularly
- Develop a thorough target customer profile and conduct research to meet the needs of this audience
- Avoid cutting corners that results in lower quality products
- Invest heavily in competitive research to stay ahead of the curve
While no single brand positioning strategy will be right for every business, it is important to recognize that the most successful brands possess a deep understanding of their brand position and work tirelessly to fulfill it in the eyes of their customers.