Can You See Your Product through the Eyes of Your Customers?
Our most recent Working Smarter PDF, "Working Smarter with Product Positioning Matrix Diagrams," discusses the benefits of using a Positioning Matrix to illustrate the positioning of your product against other competing products in the same market.
So what is "position?" Position is what dictates how your potential customers perceive your product compared to your competitors' products. There can be no position without competitors. You are "positioned" compared to them.
Understanding your product's position is important because it allows you to see your company and your product through the eyes of your customers.
But how do you express your market position? One common way is to choose two variables that are important to buyers and plot them on two axes.
In order to show where your product lies compared to your competitor's products, you simply place your product in the correct quadrant. This graph is called a positioning matrix.
Below is the example positioning matrix used in "Working Smarter with Product Positioning Matrix Diagrams;" in this example, we used our own product, SmartDraw.
Ideally your product should have one quadrant all to itself. This is because having a unique quadrant means that your product has a unique combination of factors which make it important to buyers.
If you don't have a unique quadrant for your product, then your product doesn't have a unique market position and, thus, you don't have a unique selling proposition for it either.
The Challenge of Determining Unique Market Position
The obvious challenge to building a positioning matrix is determining what factors to plot on the axes of the chart.
Here are a number of sample factors that are often included on positioning matrices (note, however, these are not ALL of the factors):
- Accessibility
- Cost
- Convenience
- Ease of Use
- Lifestyle
- Location
- Performance
- Security
- Visibility
I'm going to use an example from the auto industry that will help give you a better idea of what sort of factors can separate a market.
You can appreciate why the car market is so competitive after understanding the positioning of all of the manufacturers and their products.
How to Use a Positioning Matrix
- Try to determine what factors set you apart from your competitors (this is the hard part).
- Once you determine those factors, use the positioning matrix to communicate your product's positioning to your employees and to help guide your marketing strategy.
Market positioning helps keep companies' product lines consistent with their brands-you won't see Jaguar or BMW offering a minivan anytime soon because their brands simply do not cohere with the values of the typical minivan consumer.
Consumers will consistently view Jaguar and BMW as luxury, high-performance brands-any attempts by those two firms to produce economy, low-performance vehicles will simply fall flat with consumers, due to the manufacturer's established market positions.
If Volkswagen had stuck with its market positioning strategy, it would not have had to endure the Phaeton fiasco; the Phaeton was a luxury car with a $70,000 starting price tag and the traditional Volkswagen low-performance branding. Buyers viewed Volkswagen as a low-performance, economy brand; not a high-performance, luxury brand. And this is why the Phaeton ultimately failed.
Learn More about Positioning Matrices
If you'd like to learn how to draw a positioning matrix using SmartDraw, please watch our screencast, "Drawing a Positioning Matrix with SmartDraw."
If you'd like to try SmartDraw, feel free to download a free trial of SmartDraw.
