positioning

PRODUCT POSITIONING : PRODUCT POSITIONING 15.823 Internet Marketing Prof. Glen L. Urban Spring 2001


Slide2 : Understanding Customers Consumer Behavior B2C vs B2B Strategy Formulation Trust vs. Push Product Design Segmentation Positioning Customer Acquisition Advertising / PR/Selling Pricing & Promotion Distribution Channel Logistics Relationship Building Fulfillment Service


OUTLINE : OUTLINE Positioning Versus Segmentation Positioning Example Analytic support for Mapping Does it Pay to be First? -- Order of Entry Theory Implications for Internet


Slide5 : B C A D B A • • • • • • • • E


POSITIONING : POSITIONING GIVEN SEGMENTATION CBP DIMENSIONS COORDINATES FULFILLMENT UNIQUE POSITION SHARE/PROFIT


Slide7 : MAPPING STEPS Define category/segment Identify products that compete Attributes and features that differentiate Group attributes - perceptual dimensions Draw map Implications


CLASS EXAMPLE : CLASS EXAMPLE On Line Trading evoke -- dimensions --triad comparisions judgement for position preference vectors implications


POSITIONING ANALYSIS : POSITIONING ANALYSIS LEVEL I focus group customer contact inspect competition perceptual map -- judgment LEVEL II factor analysis preference vectors conjoint analysis LEVEL III simulation models


Slide10 : MAPPING INPUTS BILL -- M.B. 500 BILL -- HONDA BILL -- BUICK ELECTRA Luxury style reliable MPG performance Durability/resale quality maintain safe 6 5 5 6 6 5 3 5 3 4 7 5 3 6 4 5 6 4 4 4 4 5 7 5 5 7 6


DATA COLLECTION : DATA COLLECTION Email lists Zoomerang On Line Panels NFO Burke Greenfield


Slide12 : FACTOR LOADINGS Dimensions Attribute Luxury 0.88 0.10 Style 0.72 0.08 Reliable 0.45 0.63 M.P.G. 0.24 0.64 Safe 0.52 0.31 Maintain 0.10 0.67 Quality 0.48 0.64 Durability & Resale 0.38 0.60 Performance 0.67 0.35


Slide13 : Emotional Honda Lincoln Town Car Chrysler New Yorker Buick Riviera Cadillac Eldorado Rational Olds


Slide14 : Honda Lincoln Town Car Chrysler New Yorker Buick Riviera Cadillac Eldorado Rational Olds BMW Jaguar MB Emotional


Slide15 : Honda Lincoln Town Car Chrysler New Yorker Buick Riviera Cadillac Eldorado Rational Olds BMW Jaguar MB Emotional


Slide16 : ENGINEERING FEATURES PERCEPTION PREFERENCE


SURUGA EXAMPLE : SURUGA EXAMPLE


Aim of eBusiness@Suruga : Aim of eBusiness@Suruga Buyer Centric Idea Base Trust for Customer Construct business model of eCRM. Construct new services and products of eBusiness. Construct secure business with internet customers. Keyword for Success What shall Suruga do?


INTERNET STUDY? : INTERNET STUDY? Talk to Customers -- Listen Study Competitors -- judgmental Map Focus Groups Budget study if VC -- Crowded Out There Active Role in Study


Internet Study : Internet Study STEPS BUDGET DEFINE TARGET MARKET DESIGN SURVEY ATTRIBUTE GENERATION STATISTICAL MAPPING Name Dimensions Number of Dimensions Coordinates of Brands Importance Vectors MANAGER’S ROLE $50k to $250K Be Sure Correct Segment Definition is Used Specify Decision Requirements Assure Completeness Input Judgment Examine Additional Dimension for Relevance Review for Reasonableness Decide on Number of Sub-group


Internet Study - Cont’d : Internet Study - Cont’d STEPS FEATURES SIMULATE IMPROVED POSITIONING MANAGER’S ROLE Select Features and Levels, Link to preference and/or Perception Be Sure Shift Can Be Achieved, Confirm with Concept/Product Tests


DOES IT PAY TO BE FIRST? : DOES IT PAY TO BE FIRST?


THEORY : THEORY Determinants -- +/- Memory -- Accessibility Switching costs - risk and satisfaction Learning about Market Market Power - Share & Channel Scale -- Production and Funds Continuing Innovation Standard Setting Broader Product Line Technology/Market window Best Positioning? Empirical


Slide26 : ORDER OF ENTRY AND MARKET SHARE IN CONSUMER GOODS BUSINESS Average Market Share Pioneer 29 Early Follower 17 Late Entrant 12 (371 SBU’s) Pioneer 16% 20% 23% 41% 100% Early Follower 41% 24% 19% 16% 100% Late Entrant 56% 25% 12% 7% 100% Frequency Distribution for Market Share Less than 10 10-19 20-29 30 & up Total


DATA : DATA 131 Brands 36 Categories Share - Last Purchases Order Advertising Preference


ORDER OF ENTRY : ORDER OF ENTRY 1ST 2ND 3RD 4TH 5TH 6TH 7TH 100 57 43 42 32 26 34 26 22 18 29 22 18 16 15 25 19 16 15 13 12 23 17 15 13 12 11 9 Market Share


Strategic Implications : Strategic Implications Market Share Reward for Innovation If First: Position Well-Preempt Support - Advertising & Promotion If Second or Third: Premium Position Support - Advertising & Promotion Faster But Lower Innovate for Market Leadership -- But Risk


IMPLICATIONS FOR INTERNET : IMPLICATIONS FOR INTERNET Mapping -- Do It! Listen /Focus Groups Budget for Study in VC Segmentation and Positioning Strategy vs. Potential Competition -- Preempt Core Benefit Proposition -- Not Technology Establish with Features and Keep Innovating First In has Value But Catch window Have Best Position Spend behind It