Business

Positioning by Al Ries and Jack Trout

How can your company, product, or message get mindshare in this information-overloaded age? The authors of this (venerable) book invented the term positioning, a subset of marketing which deal withs how a company's stakeholders perceive it or its products.

Real estate in people's minds, especially prospective customers, is in very short supply. People are bombarded with thousands of pieces of information a day, but they can't be expected to remember even a tiny fraction of it. The human mind simply isn't big enough to hold it all. The solution is to define a simple position which can be stated in a few words and is relative to other things already in the person's mind. Then you stick to that position for years or even decades, making sure everything your company does reinforces that position.

Some examples:

Positions rely on what is already in the prospect's mind. A good position looks for a hole (or "craneau", as the authors call it) in the market. Marlboro already had masculine-appealing cigarettes covered, so Virginia Slims saw a hole to fill. That hole no longer exists, because they are now filling it. Each product has to have something unique about it so that it can be number 1 in whatever its niche is. No one has time to remember #2, let alone 3 and down.

Choosing the right name is critical. The name has to match or describe the position. They do make an exception for truly new technologies, which often use coined names. (Xerox and Kodak are mentioned here; presumably modern tech companies like Google also qualify.)

They rail heavily against the line-extension trap, something that seems to have wasted an untold number of corporate dollars on failed products. When Xerox tried to get into computers it flopped. When IBM tried to get into copiers, they flopped. Xerox means copiers - that's their position, whether they like it or not - so a Xerox computer doesn't make any sense to prospects. Ditto for IBM and copiers. Companies that want to explore new markets need to create new names for their new products or spinoff companies, so as to avoid damaging both their existing business' position and dooming the new product or venture to failure. (Primary case in point here was the "Bayer nonaspirin" product introduced by Bayer to compete with Tylenol. Since Bayer means aspirin to most people, a product named Bayer nonaspirin was both nonsensical and damaging to the Bayer name.)

Rating: 3 of 5
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Other books by Al Ries and Jack Trout:
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