Wednesday, 3 August 2011

The analytical core of "positioning" in strategic management and marketing management

The notion of "positioning" appears quite often in the strategic management and marketing management literatures. Thus, we have strategic positioning, competitive positioning, market positioning, brand positioning and product positioning. Inevitably, the literatures will elaborate on these concepts by listing all the concerns and questions involved when studying these concepts. For example, the Marketing guru, Philip Kotler maintains that positioning involves designing a company's offering and image so as to take up a distinctive competitive position in the target customers' minds. This "positioning" view is very much marketing in perspective. When a concept represents a number of concerns and questions, we have difficulty to understand the core analytical idea underlying the notion; in this case, the analytical core of "positioning" is blurred.

My view of the notion of "positioning" is as follows: (1) it is about location in a map and (2) it is about adoption of a specific set-up or configuration. For instance, when we adopt a specific strategic position, we essentially decide on a specific market segment or business environment (a location) to compete. In this specific location, we have a specific group of customers with a specific customer profile as well as a specific group of direct competitors, etc.  These specific groups of external stakeholders will influences what opportunities and threats are facing us. Secondly, in order to compete successfully in this chosen location, we need to develop an appropriate organization configuration that is translated into a specific set of relationships with our business. This relates to the second aspect of the notion of "positioning". Such an organization configuration has a specific set of strengths and weaknesses.

Sometimes, a company may want to move from one strategic position (position 0) to another strategic position (position 1); let's call this strategic repositioning. If we imagine that we note these two positions in a map, we now get two points; the repositioning is to find out how to move from position 0 to position 1. Such a move is in a specific direction (ie from position 0 to position 1); we can call this the strategic direction (of the move). In our new position (ie position 1), we need to also figure out what will be SWOT facing us once we reach that position and whether the new position will enable us to achieve a higher level of sustainable competitive advantage. The following diagram further depicts the ideas:



I think these ideas about (i) locations (or points), (ii) a map, (iii) a line between two points and (iv) a specific configuration are the key aspects of the analytical core of the "positioning" concept. They should be borne in mind when studying concepts such as strategic positioning, market positioning and product positioning, etc.. These, I believe, will help us to comprehend and apply these concepts in strategic and marketing management more effectively.

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