Marketing Report: Competitive Perceptual Positioning and Repositioning

This report delves into the concept of competitive perceptual positioning and the utilization of perceptual mapping as a strategic tool in marketing. It explains how perceptual maps visually represent customer perceptions of products or brands in relation to their characteristics and competitors. The report covers key concepts such as ideal points, demand voids, and the application of perceptual mapping in creating new products and understanding market segments. It also examines different positioning bases: functional, symbolic, and experiential, and how they relate to creating effective positioning statements. Furthermore, the report discusses repositioning strategies, highlighting the factors that necessitate repositioning, the different levels of repositioning (product line, brand, and company), and the importance of brand identity in maintaining a competitive edge. The analysis includes practical examples, such as Apple Inc., to illustrate successful repositioning efforts and emphasizes the need for companies to adapt to market changes and maintain stakeholder support during repositioning initiatives.

Competitive Perceptual Positioning
Perceptual Mapping
Perceptual mapping is a graphic display explaining the perceptions of
customers with relation to product characteristics.
Learning Objectives
Evaluate the concept of perceptual mapping as part of competitive
perceptual positioning
Key Takeaways
Key Points
 Perceptual maps help marketers understand where the consumer ranks
their company in terms of characteristics and in comparison to
competing companies.
 Perceptual maps can display consumers’ ideal points that reflect their
ideal combinations of product characteristics.
 When creating a new product, a company should look for a space that is
currently unoccupied by competitors and that has a high concentration
of consumer desire (ideal points).
 A perceptual map is usually based more on a marketer’s knowledge of
an industry than market research.
Key Terms
 demand void:Areas without any significant consumer desires; typically
found in ideal point maps of perceptual mapping.
 price elasticity:The measurement of how changing one economic
variable affects others. For example:”If I lower the price of my product,
how much more will I sell? “”If I raise the price, how much less will I
sell? “”If we learn that a resource is becoming scarce, will people
scramble to acquire it? “
Perceptual Mapping
Perceptual mapping is a diagrammatic technique used by marketers in an
attempt to visually display the perceptions of customers or potential
customers. Typically the position of a product, product line, brand, or

company is displayed relative to their competition. Some perceptual maps
use different size circles to indicate the sales volume or market share of the
various competing products.
Perceptual Map Of Competing Products
Perceptual maps commonly have two dimensions even though they are
capable of having several. For example, in this perceptual map you can see
consumer perceptions of various automobiles on the two dimensions of
sportiness/conservative and classy/affordable. This sample of consumers felt
that Porsche cars were the sportiest and classiest of the ones in the study.
They felt that Plymouth cars were the most practical and conservative. Cars
that are positioned close to each other were seen as similar on the relevant
dimensions by the consumer. For example, consumers saw Buick, Chrysler,
and Oldsmobile as similar. They are close competitors and form a
competitive grouping. A company considering the introduction of a new
model will look for an area on the map free from competitors.
Perceptual Mapping: Perceptual mapping ranks companies based on customers’ perceptions of
certain characteristics.
Perceptual Map Of a Consumer’s Ideal
Many perceptual maps also display consumers’ ideal points. These points
reflect ideal combinations of the two product characteristics as seen by a
consumer. This diagram shows a study of consumers’ ideal points in the
alcohol product space. Each dot represents one respondent’s ideal
combination of the two dimensions. Areas where there is a cluster of ideal
points (such as A) indicates a market segment. Areas without ideal points are
sometimes referred to as demand voids.

Ideal Points Maps: Ideal points maps reflect ideal combinations of two product characteristics as
seen by a consumer. Marketers are able to accurately target their message to consumers based on
consumer desires.
Combining the Competing Products and Ideal Points Maps
A company considering introducing a new product will look for areas with a
high density of ideal points. They will also look for areas without competitive
rivals. This is best done by placing both the ideal points and the competing
products on the same map. This map displays various aspirin products as
seen on the dimensions of effectiveness and gentleness. It also shows two
ideal vectors. This study indicates that there is one segment that is more
concerned with effectiveness than harshness, and another segment that is
more interested in gentleness than strength.
Combination Map: A combination map allows companies to find a space that has unmet consumer
desires.

Intuitive Maps
Perceptual maps need not come from a detailed study. There are also
intuitive maps (also called judgmental maps or consensus maps) that are
created by marketers based on their understanding of their industry. The
value of this type of map is questionable, as they often just give the
appearance of credibility to management’s preconceptions. When detailed
marketing research studies are done, methodological problems can arise,
but at least the information is coming directly from the consumer. There is
an assortment of statistical procedures (preference regression, multi-
dimensional scaling) that can be used to convert the raw data collected in a
survey into a perceptual map.
Some techniques are constructed from perceived differences between
products, others are constructed from perceived similarities. Still others are
constructed from cross price elasticity of demand data from electronic
scanners.
Positioning Bases
By using customer research and perceptual mapping, a marketer can create
a positioning statement using one of the three main bases.
Learning Objectives
Examine positioning and the strategy behind it relative to competitive
perceptual positioning
Key Takeaways
Key Points
 Functional Positions deal with solving a problem, providing benefits and
getting a favorable perception from investors, stockholders and
consumers.
 Symbolic Positions deal with self- image enhancement, ego
identification, belongingness, social meaningfulness and affective
fulfillment.
 Experiential Positions deal with providing sensory or cognitive
stimulation.
 By using customer research and perceptual mapping, a marketer can
create a positioning statement using one of the three main bases.

Key Terms
 Experiential:Of, related to, encountered in, or derived from experience
 positioning:The act of positioning; placement.
 perceptual mapping:Perceptual mapping is a diagrammatic technique
used by asset marketers that attempts to visually display the
perceptions of customers or potential customers.
Introduction
When a company presents a product or service in a way that is
differentiating from the competition, they are said to be “positioning” it.
Positioning relates to a process used by marketers to create an image in the
minds of a target market. While positioning used to focus on consumer
positioning, it now focuses more on competitive positioning.
The Positioning Concepts
There are three basic concepts for positioning:
1. Functional Positions deal with solving a problem, providing benefits and
getting a favorable perception from investors, stockholders and
consumers.
2. Symbolic Positions deal with self-image enhancement, ego
identification, belongingness, social meaningfulness and affective
fulfillment.
3. Experiential Positions deal with providing sensory or cognitive
stimulation.
Positioning is facilitated by perceptual mapping to determine the ideal points
of consumers.This helps to determine if positioning should be functional,
symbolic, or experiential. Strong positioning will enable a single product to
appeal to different customers for different reasons. For example, two people
are interested in buying a new car; one wants a car that is powerful and
stylish while the other buyer is looking for a car that is reliable and safe and
yet they buy the same exact car. One purchase solved a problem and
exemplifies functional positioning while the other purchase is an example of
symbolic and/or experiential positioning.
The Positioning Statement and Strategy
By using customer research and perceptual mapping, a marketer can create
a positioning statement using one of the three main bases.

A positioning statement explains the target market for the product, the
benefit of the product, and how the product is different than the competitors.
When creating a positioning statement, it is important to determine a pain
point of the customer. Customers often buy on a want, rather than a need,
impulse. By talking to a customer’s pain point, it is often possible to address
the need impulse and the want impulse at the same time. If both of these
issues can be addressed then it is easier to overcome objections regarding a
product.
Wants versus Needs: What consumers want may not be what they need, but it is important to
understand both.
A company can create brand positioning strategies or product positioning
strategies. It is important to understand the strengths and weaknesses of
both the organization and the competition when creating a positioning
strategy.
Repositioning
Repositioning involves changing the identity of a product relative to
competing products.
Learning Objectives
Indicate the characteristics and application of a re-positioning as it applies to
competitive perceptual positioning

Key Takeaways
Key Points
 When a company initiates a re-positioning strategy, it needs to change
the expectations of stakeholders, including employees, stockholders,
and financial backers.
 A company may need to consider a re-positioning strategy if they have
a weak brand, if they have not remained competitive in the market, or if
there is a change in the economy.
 A company may re-position a specific product line, a brand, or the entire
organization.
Key Terms
 repositioning:Changing the identity of a product or a company in the
minds of stakeholders and competitors.
Repositioning involves changing the identity of a product relative to
competing products. Many famous companies have saved failing products by
repositioning them in the market. When a company initiates a repositioning
strategy, it needs to change the expectations of stakeholders, including
employees, stockholders, and financial backers.

Apple Inc.: Apple Inc. is an example of a company that achieved re-positioning
Brand Identity
Brand identity is often involved with the success or failure of a product. A
company that has achieved brand recognition can often survive the
challenge of new entrants in a market. The problem with being at the top of
the market, however, is that someone is always trying to knock you off.
Companies that have become complacent with brand strategies sometimes
find themselves knocked off their pedestal by a competitor.
Lack of a Strong Brand
Some companies lack a strong product or brand. They perform well in the
market, but not exceptionally. Any changes in the market can force these
companies from maintaining business to failing.

Economic Volatility
A severe change in the economy can affect a company or a brand. The
hospitality industry saw this when the United States went through a recent
financial crisis. Many upscale hotels and restaurants suffered because people
couldn’t afford the prices.
There are Different Levels of Repositioning
An organization can reposition a product line, a brand, or an entire company.
Determining which type of repositioning is needed isn’t always easy; it is
important to understand the changes in the current market and how
competitors will react to the change. If a change is volatile and is
unprecedented, there may not be enough information available to use to
make a decision. Understanding the strengths and weaknesses of a company
can help determine when repositioning may be necessary and how the
change should occur. When Apple switched their focus to iPod and its
successors, for example, the company was able to change its financial
situation and achieve success. The complete dedication of stakeholders and
the creation of a product that is in demand can help companies survive a
repositioning strategy.