Welcome to the second article in our “Why Branding Matters” series.

In the first article, we explored branding’s history, definition and, most importantly, benefits. In this article, I discuss the role of proactive positioning as one of your firm’s key elements of effective branding.

Perhaps one of the most overlooked aspects of starting and running a successful business is the art of positioning. All too often, an organization’s positioning starts off weak… and only gets worse from there, as managers and owners attempt to appeal to a wider and wider audience. From their point of view, the tactic makes sense: they see it as a way to increase market share or shareholder value. This approach is particularly common among service firms.

In fact, poor positioning not only results in ineffective marketing; it also has serious financial implications. Poor positioning will most likely lead to the commoditization of your firm and its products and services, negatively affecting its financial performance and overall value.

What Exactly Is Positioning?

As with the term branding, the definition of positioning (in the marketing sense) seems to be evolving rapidly. Below are a few widely-accepted definitions:

• Wikipedia – “The process by which marketers try to create an image or identity in the minds of their target market for their product, brand, or organization. It is the ‘relative competitive comparison’ their product occupies in a given market as perceived by the target market.”
• Entrepreneur Magazine – “How you differentiate your product or service from that of your competitors and then determine which market niche to fill.”
• Al Ries and Jack Trout (from their book, Positioning: The Battle for Your Mind) – “…positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. That is, you position the product in the mind of the prospect.”

Each of these definitions is helpful, but in my opinion, incomplete. Instead, I offer an alternative definition that tries to combine what I believe are the most important elements:

Positioning is how your organization and its products and services are differentiated and perceived in the minds of your target audiences relative to how competitors are targeting those same audiences.

Real-World Examples

Below are a few positioning examples from some of the world’s most valuable brands, according to a recent study commissioned by BusinessWeek magazine. Some of these examples were taken directly from the companies’ websites, illustrating the importance of consistent positioning and brand messaging.

• Microsoft (world’s 2nd most valuable brand) – “Founded in 1975, Microsoft is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.”
• The Walt Disney Company (world’s 8th most valuable brand) – “… a leading diversified international family entertainment and media enterprise…”
• McDonald’s (world’s 9th most valuable brand) – Known for quick, consistent, family-friendly, and inexpensive food products.
• Louis Vuitton (world’s 17th most valuable brand) – Founded in 1854, a French luxury fashion and leather goods company known mostly for its luxury bags and trunks.
• Honda (world’s 19th most valuable brand) – Known mostly for its small to mid-size, highly fuel-efficient and reliable vehicles.

As you read the above list, did you agree with the overall perception of each positioning and brand statement? In each of these companies’ marketing materials—including ad campaigns, websites, store designs, and products and services—the messages work to reinforce the overall positioning of the organization. In addition, it is very common for multi-product companies (such as Microsoft and Honda) to develop and promote different positioning for their different products, illustrating the interconnectivity between positioning and branding. Let’s now explore how proactive positioning can directly benefit your firm.

The Benefits of Proactive Positioning

We’ve discussed the definition of positioning and explored some real-world examples of well-known companies that are powerfully positioned. But here’s why being proactive in your positioning is so important:

• Selectivity – If your firm or its products and services are positioned well, you’ll be able to be more selective in your clientele. Because you’ll be seen as an expert in your product line or service, more potential clients will seek you out, giving you the opportunity to be more selective regarding those clients to whom you decide to offer your services. This, in turn, will lead to the second benefit of proactive positioning.
• Profitability – Because you are seen as an expert in supplying your product or offering your service, and because this expertise and business focus has allowed you to be more selective in choosing your clients, your profitability will increase. It’s simple supply and demand: clients who view you as an expert will therefore not compare you to your less experienced, lower cost competitors.
• Manageability – By focusing on and being proactive with your firm’s positioning, you’re able to manage resources more efficiently because you’re not spread too thin, either in terms of marketing or the types of products and services you offer.
• Scalability – Because proactive positioning allows you to manage your firm’s brand more effectively by channeling all branding and marketing resources efficiently, you will have the ability to scale your processes to attract additional clients and gain market share.

Enter… Branding

Positioning is one of the most important first steps in ensuring your company’s marketing success—but without implementing consistent, compelling, and strategic branding and messaging, you’ll fall far short of your desired positioning. It is the consistent application of your firm’s brand through sales and marketing tactics that will ultimately help you reap the benefits outlined above. Conversely, failure to do so could risk your company’s products or services becoming regarded as commodities, like those of your poorly-positioned competitors.

It’s important to recognize that branding incorporates a variety of elements and vehicles to promote a simple, memorable, and consistent message about who your organization is, the products and services it offers, and their benefits. In other words, potentially, you can define your brand through the proactive use of everything from your logo and tagline to your website, photography, typography, messaging, advertising, etc.

Some Final Thoughts

Be Proactive, Not Reactive. Promote your firm’s positioning through proactive use of branding, sales, and marketing rather than being reactive. You’ll not only be seen as experts in your field, but you’ll gain market share and increase profitability, too.

Be Consistent and Compelling. Your firm’s branding should reflect and reinforce your positioning consistently throughout all your marketing materials. Without your firm’s positioning reflected in everything you do, your positioning, and therefore your brand, will become diluted.

Deliver What You Promise. Ultimately, positioning and branding will mean little unless you’re able to consistently deliver on your “positioning promise.” Indeed, if you don’t, the results may be even worse than if you had no positioning and branding focus at all.

Looking for a Better Position?

As I’ve shown in this article, positioning and branding your firm more effectively is far more than an aesthetic exercise. Planning such changes using clear strategies and goals, and then implementing your plan consistently, will help your firm achieve measurably better financial results. If you’re ready to take a new look at your positioning and branding, please contact us.