Market positioning

Market positioning flashcards

Market positioning

How customers perceive the product in terms of image, value for money, quality etc. compared to those of competitors

Product orientation

The business focuses most of its efforts into designing and producing the product itself, assuming the product will be good enough to ‘sell itself’

Market orientation

The business, through market research, identifies the precise needs and wants of customers. Using this it produces products to meet those needs. It is led by the market

Market Mapping

A diagram that compares products or brands to competitors, based on usually two characteristics that customers may perceive

Market Segmentation

Dividing the whole market into smaller groups, where each market segment has similar characteristics and needs, e.g. age & gender, lifestyle choice. Each segment can then be targeted specifically with the right marketing mix

Product differentiation

An attempt by businesses to distinguish its product from those of its competitors, by making the product sufficiently different

Adding Value

The difference between the selling price of a product and the cost of brought in materials and components

Benefits of Market Positioning

Enhances brand recognition and customer loyalty by clearly defining the product's place in the market.

Limits of Market Positioning

May limit product innovation if businesses become too focused on existing perceptions.

Benefits of Product Orientation

Can lead to high-quality products as emphasis is placed on product development and engineering.

Limits of Product Orientation

May ignore customer needs or market trends, leading to poor sales.

Benefits of Market Orientation

Helps in addressing customer needs effectively, leading to higher customer satisfaction and loyalty.

Limits of Market Orientation

Can be costly due to continuous market research and response adjustments.

Benefits of Market Mapping

Provides clear visual insights into market dynamics and competitive positioning.

Limits of Market Mapping

May oversimplify complex market situations that require detailed analysis.

Benefits of Market Segmentation

Allows for targeted marketing efforts, leading to better engagement and conversion rates.

Limits of Market Segmentation

Can lead to over-segmentation, making it difficult to develop broad strategies.

Benefits of Product Differentiation

Can create strong competitive advantages and allow for premium pricing.

Limits of Product Differentiation

High costs associated with research and development to maintain uniqueness.

Benefits of Adding Value

Increases profit margins and enhances customer satisfaction.

Limits of Adding Value

Can lead to increased costs and may not always translate to higher sales