Positioning of services

SERVICE DELIVERY AND PROMOTION

Process of Positioning

Product positioning involves a number of steps including the following:

Determining levels of positioning

Identification of key attributes of importance to selected segments

Location of attributes on a positioning map

Evaluating positioning options

Implementing positioning.

Determining levels of positioning

The first step in positioning is to determine which level(s) –service level, product sector level, corporate level –are to receive explicit positioning attention. Some examples will illustrate the choices that are made by some service organizations. The level or levels of positioning to be undertaken are usually fairly clear out, although some organisation, have placed different emphasis on these levels at different points in time.

Identification of attributes Once the level of positioning has been determined it is necessary to identify the specific attributes that are important to the chosen market segments. In particular, the way in which purchasing decisions are made should be considered. Individuals use different criteria fro making a purchase decision of a service.

Location of attributes on positioning map

The positioning process involves the identification of the most important attribute and location of various companies‟ services, for theseattributesattribare identified, statistical procedures exist for combining these attributes into aggregate dimensions. Such dimensions are referred to by various names such as principal components, multi-dimensional scales, factors etc. depending upon how the data were elicited and which statistical procedures were used. Usually two dimensions are used on positioning maps and these often account for a large proportion of the „explanation‟   of   the   customer‟s   preference.

Products or services are typically plotted on a two dimensional positioning man such as show in the following figure. The positioning map can be relation to the selected attributes. The analysis can be further developed by drawing separate positioning maps for each market segment. Customers in each market segment may perceive the service and its benefits differently and different map will show these different positions.

Fig. 6.1 Illustrative positioning man

Positioning maps can be based on either objective attributes or subjective attributes Maps can also use a combination of objective and subjective attributes.

Evaluation positioning options

·Strengthening current position against competitors to avoid head-on attack.

·Identifying an unoccupied market position that was not filled by a competitor

·Repositioning the competition.

Once a company had identified where it is positioned at present, it then needs to determine how to enhance or sustain its position relative to its competitors.

Criteria for good positioning

·The positioning should be meaningful.

·The positioning must be believable.

·The positioning must be unique.

Implementing positioning and the marketing mix

How a company and service is positioned needs to be communicated throughout all of its implicit and explicit interactions with customers. This suggests that all elements of the company, its staff, policies and image, need to reflect a similar image which together conveys the desires position to the market place. This means that a company must establish a strategic positioning direction, which is followed through in all of its tactical marketing and sales activities.

A successful positioning strategy should make the service clearly distinguishable by features which are desirable and important to the target customer segment. This means that the positioning strategy should be examined from time to time to ensure that it does not become outdated and that it is still relevant to the target market segment.

The marketing mix is the key to implementing a positioning strategy. The design of the marketing mix to implement the positioning must be based on the key salient attributes relevant to the target segment. These attributes should be identified in the context of analysis of competitors, whose positions should be assessed to discover their vulnerability. All the elements of the marketing mix can be utilized to influence the customer‟s perception and hence The marketing mix can be used to develop a coherent totality that creates the positioning in the customer‟s mind.

Importance of Positioning

Positioning involves both launching new brands into the marketplace (new brand positioning), and repositioning old brands. It is concerned with the differentiation of products and services and ensuring that they do not degenerate into a commodity. To maximize its potential a company should position itself in its core market segments, where it is objectively or subjectively differentiated in a positive way over competing offerings.

Positioning is particularly import for services in the market. As a result of competitive pressure the consumer is becoming increasingly confused by the huge offering of services within each market sector. These offering are communicated by a vast number of advertising messages promoting different features of the services. The key to a successful positioning strategy is to promote the feature which the company is best and which exactly matches the needs of the customer.

Because of intangibility and other features associated with services, consumers find that differentiation of services can be more difficult and complex. Successful positioning makes it easier for the customer to see a company‟s services as being different from others and exactly what is wanted.

Positioning is a strategic marketing tool which allows managers to determine what their position is now,

what they wish it to be and what actions are needed to attain it. The permits market opportunities to be identified, by considering positions which are not met by competitors‟ products. It therefore helps influence both product development and the redesign of existing products. It also allows consideration  of competitor‟s possible moves and responsesconceptis often considered at the product level although it is also relevant at the product sector and organizational level. Positioning involves giving the target market segment the reason for buying your services and thus underpins the whole marketing strategy. It also offers guidelines for development of a marketing mix with each element of he it being consistent with the positioning.

Positioning services in competitive markets

Service represent

a.                   Speed with which service is delivered to the quality of interaction between customers and service personnel.

b.                       Convenience –service delivered at convenient location, available at convenient times.

Postioning strategy:

It is concerned with creating and maintaining distinctive differences that will be noticed and valued by those customers with whom the firm would most like to develop long-term relationship.

It requires to understand

a. Target customers preferences b.Characteristics of their competitors offerings.

I.             Focus underlies the search for competitive analysis:

As competition intensifies in the service s organizations to differentiate their products in ways that are meaningful to customers. It is not realistic

for a firm to try to appeal to all potential buyers in a market because

(i) The customers vary in their needs purchasing behaviour, consumption pattern and geographically wide spread.

Important Vs. Determinant attributes:

Determinant attributes:

These are the attributesng thatcompeting alternativesdeterminethatareimportantbuyer to purchases, which customers see significant differences among competing alternatives.

Ex: Airlines –   Convenience of departure

Convenience of arrival time

Availability of frequent flyer

Case of making reservations.

Important Atrributes

·                             Price which is quantitative and can be measured.

Positioning distinguishes a brand from its competitors:

Competitive positioning strategy is based on establishing and maintaining a distinctive place in the market for an organisation / individual product offerings.

1.                       A company must establish a position in the minds of its targeted customers.

2.                       The position should be singular, providing one simple and consistent message.

3.                       The position must set a company apart from its competitors.

4.                       A company cannot be all things to all people; it must focus its efforts.

 “Positioning needs to keep competitors out not draw them it.”

Copy positioning Vs. Product positioning

Copy positioning:

People make decisions based on their perceptions of reality rather than o reality.

Marketers associate positioning primarily with  the communication elements of the marketing mix,

advtg, promotions and public relations which creates good image and associations so as to give them a

special distinction in the customers mind.

Product positioning

To improve a product‟s appeal to a specific t certain attributes.

·                             Reduce its price

·                             Alter the times and locations when it is available.

·                             Performance, price, availability

Positioning role in marketing strategy:

^Ø         It plays important role because it links market analysis and competitive analysis to internal corporate analysis. [Refer pg. 66 Table 3-1 of zeithmal]

^Ø         Because services are intangible, explicit positioning strategy is valuable in helping prospective customers to get a mental fix on a product.

^Ø         The organization is pushed into a positive where it faces head on competition from stronger competitors.

^Ø         The organization is pushed into a position that nobody else wants, because there is little customer demand.

^Ø           The   organization‟s   product‟s   position   is The organization‟s product‟s position is so blurred that nobody knows what it‟s distinctive competence is.

^Ø           The organization has no position at all in the market place because nobody has ever heard of it.

CUSTOMER POSITIONING OF SERVICES

Consumer positioning of a service involves two concepts. First, it means the position the firm or organization occupies in the minds of consumers. What a company thinks is their position in the market place does not matter. Rather, it is what the consumers think that is important. Second, positioning is always relative to the competition. In choosing a service firm, consumers will compare its service offerings to other firms within the industry.

METHODS OF POSITIONING

Services can be positioned in 6 different ways. They can be positioned by service attributes, use of application, price/ quality relationship, service class, service user, or competitor.

Service attributes involve positioning the service in terms of what it does best. For instance, Federal

Express tries to position itself as the best f as the best firm for “package delivery”.

Use or application can be used for positioning. Fitness centres are often positioned inthis way. Some fitness centres will cater to individuals who want to reduce weight, while others position themselves for individuals who want to exercise or on weight lifting or conditioning. Each position targets a different market segment and requires a unique combination of equipment and physical facility design.

Price- Quality relationship can also be used for positioning a firm.

The fourth means of consumer positioning is by service class. Pizza Hut wants to be positioned as a

„dine- restaurant‟,-foodresnotaurantfast. Their advertisem-in restaurant in the pizza industry”.

Some services are positioned according to service users. Service providers can also position themselves relative to a competitor.