Book Review: Positioning by Al Ries and Jack Trout
- Jun 21, 2021
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Positioning starts with a product. It could be goods, a service, a company, an organization, or even a person. However, positioning is not what you do to a product. Rather, it refers to what you do to the mind of a prospect. For example, in supermarkets. What brand comes to your mind when you think of supermarkets? Personally, I think of FairPrice, Cold Storage, and Sheng Siong. But are you aware that in Singapore alone, there are more than twenty brands of supermarkets? Why is it that the supermarket landscape in Singapore is being dominated by these three big players? It all has to do with positioning.
Through this book, Trout and Ries has described how companies are able to approach the minds of prospects through positioning. Today, it’s not required that a brand invent or discover something. However, a brand must be first to get into the prospect’s mind.
The authors have also stated that it is important for companies to know the position of their competitors. Only by doing so can companies come up with an effective positioning for their product or services.
One good example from the book is Avis. Avis accepted that Hertz was the category leader when it comes to the rental car business – and that confronting them head-on would be pointless. What Avis did was admit that they were second to Hertz, with the tagline “We try harder”. This campaign brought about huge success to Avis because Avis related itself to Hertz, who is the market leader in the rental car business.
Below are some key takeaways that allow you to better position your business.
Here are some key takeaways from the book:
#1: Being the first in any category is very crucial
The human mind can only absorb so much in a day. Once this limit is hit, we instinctively filter out whatever information we consider to be less significant or relevant to us. Because of this, a huge amount of information tends to be overlooked – This is also the reason why so many companies fail to get the message across.
Therefore, being the first in any category gives you an edge over your competitors. It means that you have put yourself first in the minds of your prospects first. And it’s difficult to bring a company down in the first place. Imagine a ladder. Now, imagine Coke and Pepsi. Coke will always be at the top, and it is difficult for Pepsi to overtake Coke. This brings us to the next key takeaway.
#2: If you are not first, create your own ladder
According to Trout and Ries, the hard way to get into a person’s mind is second. Second is nowhere. Thus, rather than attempting to fight for a position in the prospect’s mind as having the best product, it is better and way more effective to position yourself in a different niche.
For example, if the #1 fast-food restaurant has the best burgers, you could try positioning yourself as having the best fries instead. The main point is to try to stop going head to head with the #1 in your category, and to create your own ladder to be #1 of. At the end of the day, this could be a better tactic in terms of attempting to come out on top of your competitor. Just because you are positioned as the best fast food restaurant serving fries does not mean people won’t see you as the best fast food restaurant in Singapore. Below are some positioning ideas that you can take note of when creating your own ladder.
- Size Position. A product that is smaller than the existing options available.
- High Price Position. A new product that belongs to the premium category.
- Low Price Position. A product that is low-priced. This position is useful for new brands with short shelf life. Giant and Value Dollar Shop tend to give the most value to customers, and these shops loudly position themselves as low-priced.
- Gender Position. Some businesses appeal to different genders in order to attract and connect with them. For example, the Marlboro Cigarette was targeted to males, while Virginia Slims were targeted to females.
- Age Position. Businesses can target the different age groups of potential customers. For example, Colgate carries many kinds of toothpaste catered to people from different age groups.
Advertising and Positioning are not considered a logical debate with prospects. It’s a subtle seduction. Prospects won’t debate with the logic and the points together. However, if you create something completely new, use a comparison with old ones. Automobile inventions were named “horse-less” carriages, while cola became “zero-sugar” beverages. The list is endless.
Following comparative positioning would be the classic marketing strategy. The power of an organization is derived from a product. Therefore, if you diversify with a new product, make sure to use a separate name of the brand. For example, Coca-Cola only has power because of the soda drink they sell. The company itself is merely a reflection of that power. Outside of the cola field, they had to earn their power the hard way.
Procter and Gamble, Coca-Cola – they do it well. These companies have managed to create a separate brand for each product and do a multi-brand strategy, rather than utilizing the power of the successful product which is already at the top. Procter and Gamble sell different detergent with different brand names which makes it easier and cheaper for them to manage, as well as create unique business strategies for each brand. In the same way, Coca-Cola does not call its healthy version of beverage Coke Healthy, rather, they brand it with different names.
To reposition a brand which is already occupying the #1 slot, brands need to conflict with a simple idea that changes perspective in consumers mind to create a void. When people believed the earth is flat, someone said, “No, it is round” and they gave simple theories for people to verify themselves. A person doesn’t have to be a mathematician to verify that. When an established product leaves a gap, competitors can talk about it and reposition their product as filling the gap.
To change the positioning of your competitor, you must rather say something about the competitor’s product to change the customer’s mind, rather than talking about your own product.
“The objective of your advertisement should not be to communicate your customers and prospects, but to terrorize your competitor’s copywriters” – Howard Gossage
Always highlight drawbacks of the competitor’s brand – in a subtle way and propose the solution. That was what Tylenol did against Aspirin and Stolichnaya did for other American vodkas.
The comparison must be avoided in repositioning your brand. Some brands failed to create impressions in customers’ minds because they compared themselves with other leaders and emphasized the points that they are best which eventually failed with a question in consumer’s minds, “if your brand is so better, how come it is not the leader?”
#3: Your brand name is important!
Can you think of a few brands that come to your mind? Why so? Brand names are important as it will unconsciously hold a position in the prospect’s mind. Hence, it is critical to keep your brand name relevant. As an illustration, Kodak and Nike may seem like random brand names, but if you do search for what the word actually means, you will be able to better comprehend and relate to the position they want the brand to hold in your mind.
It is also common for brands to change their names from time to time in order to stay relevant. They do it for broadening the meaning and generalizing it. For example, the Sales Management Department has now evolved into the Sales and Marketing Department to accommodate the fast-changing market needs.
#4: The line-extension trap
Line extension occurs when a strong brand, such as Coke, decides to employ the same brand name on a new product. While there are certain situations where line extension may come in handy / makes sense, more often than not, one should be wary of it.
For instance, if you were Coke, and wanted to launch a new soft drink, it would only be wise not to call it Coke Juice. Line extension dilutes your brand. It also makes it more difficult for your brand to maintain a strong presence in the minds of prospects. Is Coke still a cola company? Or has it evolved into a company that produces a line of soft drinks? If things go awry, it is possible that the #2 in the category, in this case, Pepsi, may end up taking the top spot.
Procter & Gamble, unlike Palmolive and Colgate, brands each product with different names so they are separated from each other and sell 5 times more than that. If the initial product name is in the consumer’s mind, it stands for something which also means companies shouldn’t dilute brand positioning. “In positioning, the shortest distance between two points is not necessarily the best strategy. The obvious name is not always the best name” Line extension names are forgettable because they don’t have any position on their own.
You must be thinking then, when can I line-extend my product? Well, Trout and Ries mentioned it is only possible if your competitors are foolish. If your volume is small. If you have no competitors. If you don’t expect to build a position in the prospect’s mind. If you don’t do any advertising. Despite that, it doesn’t mean you can never line-extend. there. Below are a few rules taken out of the book that will tell you when to use the house name and when not to.
- Expected volume. Potential winners should not bear the house name. Small-volume products should.
- Competition. In a vacuum, the brand should not bear the house name. In a crowded field, it should.
- Advertising support. Big-budget brands should not bear the house name. Small-budget brands should.
- Significance. Breakthrough products should not bear the house name. Commodity products such as chemicals should.
- Distribution. Off-the-shelf items should not bear the house name. Items sold by sales reps should.
#5: How to position your business in prospect’s mind
Firstly, it is important to identify what position you already have in the mind of your prospect. Once you have done so, it will be much simpler for you to establish what position you want to own. It is also crucial to know who your competitors are and whether you have enough budget to go against your competitors. Lastly, sticking it out in the industry is of utmost importance. Positioning is a concept that is cumulative. “Whether you are selling colas, companies, countries, or even yourself. Out of mind, out of business.”
- Think outside in rather than inside out. Look into the prospect’s mind and find where you stand.
- Define yourself with a single concept ruthlessly. Avoid the too broad position to own. You can’t be everything to everybody.
- Don’t be afraid to make mistakes. Even lousy ones. Anything worthwhile doing is worthwhile doing lousy.
- Find the hole to fill. Find the position nobody owns. Don’t go head to head!
- It’s better to try a narrow market first before going global. Being #1 in Singapore is better than being #7 in Southeast Asia.
- Understand the words you choose for your business. Words have meanings and they hold pictures in mind. Every product is just a box without the name of the product on the box. Therefore, choose your name wisely. A racing car can’t be called a turtle.
- Don’t change for the sake of changing! It is important to hold your position. Rather, you can find different mediums to deliver your message, such as the use of technology. One good example would be Netflix. Although the company started as a distribution channel, it recently emerged as the leader for online streaming platforms.
#6: How to position yourself and your career
“In politics,” said John Lindsay, “the perception is the reality.” So, too, in advertising, in business, and in life.
Well, before you start thinking that ‘Positioning is not relevant to me, I do not intend to start a business.’ I am here to tell you that it is possible to position yourself and your career through the positioning techniques we have earlier read about. Firstly, you have to define yourself. How do you want people to remember you, and what do you want them to remember you for? If you are able to properly define yourself, you might be able to get into the minds of your prospects. Next, do not be afraid to make mistakes! More often than not, humans learn the most by pushing themselves out of their comfort zones and making mistakes.
As stated by Trout and Ries, your reputation will probably be better within the company if you try many times and succeed sometimes than if you fear failure and only try for sure things. Next, it is important to make sure your name is right. Have you ever heard of the singer, Katy Perry? Do you know that she actually changed her name such that she wouldn’t be mistaken for another singer? Now you know the importance of names! Lastly, in order to succeed, it is important to try smarter. How? Find a horse to ride! While your pride may stop you from doing so, success in life is based more on what others can do for you rather than what you can do for yourself. Below are the six types of horses you can and should ride:
- Your company – It is paramount that you know the direction of your company. Is this company able to provide you with growth opportunities? If it isn’t, my advice to you is to get a new company.
- Your boss – Ask yourself the same questions about your boss as you asked yourself about the company. The goal here is to work for the smartest, brightest, most competent person you can find. Why? If your boss is going places, chances are good that you are too.
- A friend – No, I am not referring to your personal friends. Rather, it is beneficial to have a large circle of business friends. The more business friends you make outside of your own organization, the more likely you are to end wind up in a big, rewarding job. However, do take note that it is important to exercise these business friendships once in a while, otherwise, you won’t be able to ride it when you need it! You can do so by asking them out for lunch once in a while, sending them articles that they may be interested in, as well as congratulating them when they achieve their goals.
- An idea – We may all have had moments where we thought of a great idea but were reluctant to share it with others for fear of being ridiculed. Sometimes, people expect too much of an idea. In order to ride the “idea” horse, you must be willing to be ridiculed. You must be willing to go against the tide. Only by sticking your neck out and taking risks will you be able to be the first in coming up with a new idea or concept.
- Faith – It is crucial to have faith in others and their ideas! Have you heard the story of Ray Kroc and the McDonald Brothers? From this story, the key takeaway is to believe in yourself! If you don’t, you are bound for failure.
- Yourself – While it is possible to succeed in business or in life all by yourself, it’s not easy. It always takes two hands to clap. Take selling, for example. You don’t make a sale all by yourself. Somebody also has to purchase what you are selling. As Trout and Ries mentioned, it is important to remember that the winningest jockeys are not necessarily the strongest or lightest. The best jockey doesn’t win the race. The jockey that wins the race is usually the one with the best horse. Therefore, pick yourself a horse to ride and then ride it for all it’s worth.
In conclusion, and I quote, ‘To win the battle for the mind, you can’t compete against a company that has a strong, established position. You can go around, under or over, but never head to head.
I would highly recommend giving this book a read, especially if you are interested in or new to building a brand. This book can aid you in better understanding how to position your brand and win.
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