Positioning Strategies: How Do You Differentiate Yourself from the Competition?

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Sections of this topic

    (Adapted from The Executive Guide to Facilitating Strategy)

    In the course of developing strategic plans, organizations often find themselves taking a step back to ask the question, “How can we differentiate ourselves from the competition?” The answer to this question often results in the development of positioning strategies.

    In his book, The Discipline of Market Leaders, Michael Treacy defined three primary positioning strategies. He found that the best organizations in the world, while at least adequate at all three, typically distinguished themselves and built their success around one of the three areas. I have added a fourth positioning strategy (marketing dominance) based on my strategy development work.

    Exhibit – Positioning Strategies

    Operational Excellence Organizations who win through operational excellence do business faster, cheaper, or more effectively and consistently than anyone else. They have fine-tuned the operation so well, that the customer expects perfection every time. And, usually, they deliver. Examples: Wal-Mart, Federal Express, McDonald’s
    Product Leadership What do Sony, 3M and Lexus have in common? They seek to position themselves as product leaders. They strive to have consistently better products than anyone else. Sony, for example, was the first with the Walkman, the Watchman, and even betamax. Well, you can’t win them all – though beta continues to be the preferred technology in the professional video world. But, product leaders do tend to be the first out with winning products over and over again. Examples: Sony, 3M, Lexus
    Customer Intimacy These organizations strive to win by knowing their customers better than anyone else and using that knowledge to competitive advantage. In a world replete with poor service, organizations stand out when they deliver consistently strong customer service. Examples: Ritz-Carlton, Nordstrom, Amazon.com
    Marketing Dominance What about Coca-Cola, Nike and Microsoft? They are representative of a fourth positioning strategy. Each of these organizations has competitors with better products and better operational efficiencies. Nor are these organizations known for particularly strong customer service. But what they do have is marketing dominance. They win by positioning their products in the hearts and minds of their customers, better than anyone else. Examples: The Coca-Cola Company, Nike and Microsoft

    You can use the four positioning strategies to help your team understand how it is winning today and how it will need to win in the future.

    The Process

    The process for developing positioning statements includes the following steps that support our overall methodology, Drivers Model – taught in our training, Secrets to Facilitating Strategy.

    1 Educate the team on position statements and positioning strategies After completing the review of the briefing book review and SWOT or just the briefing book (if positioning statements are done instead of the SWOT), educate the planning team on positioning statements and positioning strategies.
    2 Define your current and future positioning strategy Have the team identify which of the four fundamental positioning strategies represents the way the organization operates today, and which positioning strategy best characterizes how it will need to operate in the future.
    3 Identify areas for positioning statements After defining the future positioning strategy, the next step is to identify the areas for developing positioning statements. Positioning statements have two parts: the external trend (“We believe…”) and the action that will be taken (“Therefore, we must…”). There are traditionally two approaches to writing positioning statements. The first approach is to base the areas for positioning statements on the most important external trends from the briefing book review and SWOT. The other approach is to identify first the key actions we know we need to take and then identify what is happening in the external environment that mandates the action.
    4 Identify strategies to respond to the trends With the key trends identified, the next step is to brainstorm strategies to address those trends. For positioning statements, the strategies need only use the “verb-object” format; there is no need to include “purpose” since this will be covered by the “We believe…” portion of the positioning statement.
    5 Format the positioning statements With the trends and strategies identified, you can now create the positioning statements that combine the two. The trend will be used in the “We believe…” portion of the statement and the strategies will appear in the “Therefore, we will…” portion of the statement.
    6 Perform a quality check The final step in the positioning statement process is to review each of the quality check items to ensure that all the checks are met.

    More about these steps is outlined in depth in The Executive Guide to Facilitating Strategy.

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    Certified Master Facilitator Michael Wilkinson is the CEO and Managing Director of Leadership Strategies, Inc., The Facilitation Company and author of The Secrets of Facilitation 2nd Edition, The Secrets to Masterful Meetings, and The Executive Guide to Facilitating Strategy. Leadership Strategies is a global leader in facilitation services, providing companies with dynamic professional facilitators who lead executive teams and task forces in areas like strategic planning, issue resolution, process improvement and others. The company is also a leading provider of facilitation training in the United States, having trained over 18,000 individuals.