Last night while Twittering about helping people out with some marketing ideas, a friend asked me what I meant when I tweeted about positioning. It led me to think about how little many people think about marketing and what it entails. Usually, the requests that I get are either for things like newsletter help or coming up with names for products. People tend to be surprised when I barrage them with a series of questions about their targets and identities. To that end, I thought I would summarize some of the initial steps of market planning. Obviously, this is directed at the non-marketer crowd. Anyone in the field will find this really elementary and may have some argument about my methods (depending on where they went to school, for example.) I also figure that this kind of posting can’t hurt my interview preparation.
Three of the first things that one must consider in developing a marketing plan are segmentation, targeting, and positioning. This methodology will help you narrow your focus and properly communicate the desired traits of your product or service. Don’t ask me to come up with a name or a catchy slogan for your idea until you’ve got the STP worked out!
Segmentation is a process where one divides the market into a set of smaller groups that are defined by similar characteristics. The idea is that people in a segment will all view your product in a similar way. Divisions may be based on geographic, demographic, or psychographic factors. For example, a friend of mine who runs a comic book store asked for help in marketing the store. I immediately asked him about the segments of his customers. Not everyone who shops there resembles the Comic Book Guy from the Simpsons. College students have different buying habits than young professionals, and parents of young children may be looking for different products than adults buying solely for themselves. Another friend asked me for help in naming a health food line. In our ensuing discussions, I pointed out that just as consumer needs vary across different maladies, so do they vary across age groups. The level of detail that you go to in segmenting is up to you: the finer details you get, the more personalized the product becomes, but the more expensive the process becomes (either in opportunity costs to non-targeted segments or in production costs relating to mass customization.)
Targeting is the next logical step after segmentation. Basically, you are deciding on which of the segments you wish to focus your marketing plan. For example, my comic store owner friend may see a large group of high school athletes running past his store every afternoon, but he would probably get a better return on his efforts if he targeted a smaller but more interested segment. You aren’t limited to one segment, but you have to remember that each segment views your product or service differently. Marketing is not one size fits all! If you don’t believe me, ask yourself what would happen if you switched the marketing plans of Nutrisystem and Jenny Craig. No one would pay attention to Dan Marino and John Kruk during Oprah or 80’s sitcom actress during SportsCenter!
Positioning is where the real fun starts (unless you’re a real census fan, then you’re already having a ball.) I defined positioning on Twitter as creating an identity to fit a niche in the customer’s mind. My friend wasn’t impressed, so I guess I need to elaborate. Positioning is like creating a mental marker or shortcut to your product in the customer’s mind. Why do you bookmark your favorite sites in your web browser? You do it because it’s easier than typing the full address out every time you want to see the site. More importantly, it’s easier than typing a full address every time you want to see that kind of site. There are probably a thousand different sites I could go to to get NFL updates, but I have two bookmarked (SI.com and ESPN.com). Why these two? I have a belief in their accuracy and completeness based on my exposure to the magazines on the store shelves and the 24-hour TV cycle.
Positioning in the marketplace is no different. We repurchase the same brand because they were good enough last time, and we don’t want to do the research necessary to determine which option may be slightly better. We create heuristics for choosing products that satisfy our emotional needs, so marketers have to communicate a product’s ability to do so. Imagine what would happen, for example, if ketchup had their own version of Cosmopolitan to tell it what shoppers were looking for. Maybe then we’d see brands other than Heinz, Hunts, and whatever the supermarket in calling their version.
One of the critical reasons for successful positioning is to beat out the noise in the market. In Positioning (see my last post), Al Ries points out time and time again that people know the market leader and the top alternative, but may not know the other competitors. Why did Avis create the “We’re #2, we try harder” campaign? They did it because everyone knew that Hertz was the leader in rental cars, and they needed to counter-program them. Don’t fight over who’s better, show how you’re different. I’ve told my friend that her health food line has to be marketed along its differentiating qualities in order to break through the noise. You don’t build an identity in the consumer’s mind by being part of the crowd, you build an identity through differentiation.
In a future post, I’ll tie the idea of being positioned as the market leader or the best alternative to market share and market stability. In the meantime, feel free to comment on my thoughts.
So Gregg, does that answer your question?