The second significant opportunity for your business to capitalize on when emerging from a crisis is your positioning. Positioning is defined as your core business model – the markets you serve, the customer or client experience you offer, the product or service people buy from you, and how much they are willing to pay for it. Positioning is important because it differentiates you from your competitors.
Strong positioning should tap into your business’ unique identity, which comes to life through your brand messaging. Often in a crisis, business behavior becomes unfocused as companies scramble to react to the environment. However, as they react so too do their competitors, thus requiring each business to analyze their positioning to make the appropriate adjustments to achieve their revised goals.
Remember, as your Vision changes you will also need to evolve your Culture, Brand and your Positioning. If these are misaligned, meeting sales goals will be much harder.
A well-positioned business in the current market is a focused business, and we take the following steps to help our clients discover and clarify where they are going next.
Once again implementing our three-step Assess-Design-Evaluate methodology, we consider if and how your customers’ needs, wants, and desires have changed (or will change) moving forward in the new environment. In Opportunity #1, we walked you through the process of deciding if your vision remains relevant or requires a new direction. Next, we determine how to reposition your business and brand to fulfill that revised vision.
It is understandably difficult for some companies and leaders to notice that their positioning has slipped under these changing conditions. For example, a business that offers a premium product in an average market will struggle to achieve its target price because its consumers may simply be unwilling to pay that premium price, in the current economy, no matter the quality. The product price may be discounted to reach short-term sales goals. This is not a sustainable strategy.
If your positioning is not achieving your sales and revenue targets, it is time to realign.
The 4 Components of Positioning
Our Positioning framework includes four key components that ultimately control business positioning and signal its efficacy. When the four tires on your car are correctly aligned, you can drive as straight as you please. But if any one of the tires out of alignment, that imbalance can steer you off course. So, too, must the four components be aligned:
- Markets – range from top-tier, mid-range to low-end, and no market is inherently better than another. Selecting the right market to serve is the first step to identify their unique characteristics, and your market will help determine the next three positioning elements.
- Experience – is the customer’s experience of your product or service and whether it is commensurate with the market you are targeting. Customers in the mid-range are more likely to expect a good user experience, not premium, white-glove service. Providing a top-notch experience to a mid-range market will typically cost you more than the customer’s expectations. Thus, the two would be misaligned.
- Product – quality should be consistent with the market and user experience expectations. Again, your product quality should be commensurate with the other three positioning levers. If not, you run the risk of margin compression or worse, products that must be discontinued.
- Pricing – reflects your ability to capture the value received by the customer based on the first three levers. Aligned pricing maximizes your revenue and profits from your target market.
The goal is to balance your market, user experience, product quality, and pricing for the current environment while also looking toward the future. You can do everything else right and still not be successful if these elements are out of alignment.
Design & Evaluate
With an honest assessment of your alignment, we move on to design your positioning and how to reflect it to customers and prospects. Your staff will also need training and guidance on how to promote and deliver the new positioning. The design stage connects back to your vision to ensure continued relevancy.
Once the design stage is complete, you need to work with your customers, prospects, and team to analyze and fine tune before rolling it out to the world.
If you are not getting the results you are looking for in the current environment, then it is time to reassess your positioning.
Destined is here to help you evaluate your positioning and design a plan to differentiate your business and remain relevant in today’s changing market. Contact Kim Kaselionis. Our next article Opportunity #3: Discusses the opportunity to grow through acquisition.