Company Description and SWOT Analysis

Page 142-143

Strategic Position Is More than Advertising

Don’t be confused: A true strategic position is not the same as an advertising campaign or slogan. Advertising

and marketing are means to achieving your strategic position — they help you create the image consistent with

your position and get your message to potential customers. Defining a strategic position is about creating a

meaningful place for yourself — a position — in the market.

How does Coca-Cola differentiate itself from Pepsi? Very little of the difference is based on the qualities of the

products or the market segment they are targeting. The two companies may have incorporated some operational

differences, but they differentiate themselves primarily on the basis of advertising — not strategic positioning.

When Snapple came along, it created a totally different position for itself in the market. Snapple didn’t try to

compete head-to-head with Coke and Pepsi; instead, it looked for a different segment of the soft drink market:

the non-cola, non-carbonated soft drink.

If a luxury car company that has sold primarily to older consumers decides to market to younger drivers, it

won’t be enough to take the same kind of car they’ve been making and devise a clever advertising campaign.

The product itself — in this case a car — has to be redesigned to fit the tastes of their target market. It may have

to be smaller, sportier, faster, with more electronic gadgets. Not only will the marketing materials need to be

geared toward a younger audience, but the salespeople will have to be trained to learn that the 20-something kid

in the rock band T-shirt may not be just killing time with a test drive but may actually be a techie millionaire

ready to buy.

What Kinds of Strategic Positions Are There?

What makes a company different? Is it the nature of its products or services? The quality or cost? The

geographic area or type of customers served? Perhaps the company has proprietary products customers can’t

find elsewhere.

There are many ways to distinguish yourself from your competitors, including:

■ Customer Perception Factors

■ Market Segment

■ Market Share

■ Operational and/or Technological Advantages

■ Proprietary Products, Technology, Abilities, or Relationships

■ Sales Channels

■ Business Model ■ First-Mover Advantage

■ Lean Start-Up

■ Branding

Each of these strategic approaches offers opportunities but also poses pitfalls. And they may be related: If you

are positioning your company on the basis of low price, you’ll also need operational efficiencies to reduce costs

or else you won’t be able to survive against competitors with higher profit margins.