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Knowledge Update

Positioning Trap? -A Boon or Bane

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In today’s ever competitive business scenario, positioning could be considered as one of the latest marketing strategies that a company intends to use. It is due to every industry is crowded with more competitors driving to intensive competition. It leaves consumers to be confused with the selection of suitable products/services/brands to buy and consume. Thus, positioning strategy comes to rescue of the companies to use an effective marketing strategy to differentiate from other competitors. The companies used this effective strategy to create a space for themselves in respective industries they do business, as well to capture a place in the minds and hearts of potential consumers.

Brands ranging from Sony to Mercedes to Apple to leading airlines of the world involved in such exercises, thus resulting to effectively capture mind share and money share of their target consumers. Then, came in a new wave of value for money brands (VFM) which offered utility and social value to consumers for the money they pay for. The consumers started moving towards such brands which offered greater utility value, excellent performance etc. for products for the price they paid for. The electronics industry which witnessed such a massive new wave of VFM brands churning out products such as UHD LED TVs , Top end home appliances, mobile phones, electronic gadgets etc. These brands donot belong to the leagues of Sony or Apple, however, they generate revenues either equal or far more than that of leading premium brands. The brands which positioned themselves as premium brands got entrapped in their positions as they could not go down to reach bigger markets consist of larger target consumer base.

The VFM brands are intelligently focusing on Middle and bottom of the market (if World market is considered a pyramid, the peak consists of smaller base of target consumers, and the base of such consumers get wider towards moving down to middle and bottom of the pyramid) which houses larger number of consumer base belong to middle and lower income groups. Such groups of consumers intend to buy and use premium brands if such brands are available at affordable price. To fill such a gap in this market, VFM brands launched products suit to such markets and reaped enormous benefits. Even, some of the IT colleges in Dubai focus on offering state of the art IT programs at affordable fees. Such colleges could also be considered VFM brands in the areas academics. It is a precursor to leading institutional brands to adopt such strategy.

The premium brands those who focus on top of the pyramid got entrapped in their positions due to their image and inability to move down to middle and bottom of the pyramid. Trapping into such positioning statue could help premium brands to woo high end consumers, however, with the ever changing economic and social scenario across the world leave such companies to get entrapped with their positions as such consumers move across to different brands or move away. Such exodus leave the premium brands void of potential consumer base to focus on. Therefore, positioning trap could be a boon to begin with, however, later became a bane to such brands. Hence, it is imperative for such brands to re-invent their strategies to go after new age of consumers who prefer to buy VFM brands and smart enough to how and where to spend and save.