1. Positioning
Positioning concept
Perceptual mapping
Preference mapping

2. Key Concepts
Differentiation: Creation of tangible or intangible differences on one or two key dimensions between a focal product and its main competitors.
Positioning: Strategies conceived by firms to ensure that the main differences between the focal product and its competitors occupy a distinct and important position in the minds of current and potential customers.
Mapping: Techniques (using customer-data) that enable managers to develop differentiation and positioning strategies by helping them to visualize the competitive structure of their markets as perceived by their customers. Example data include customer perceptions of existing products (and new concepts) along various attributes, perceptions of similarities between brands, preferences for the products, or measures of behavioral response of customers toward the products.

3. Some Positioning Bases
Life style (self-concept) positioning
Attribute positioning
Benefit positioning
Competitive positioning
Time-based (e.g., usage occasion) positioning

4. Generic Positioning Strategies
Our product is unique
(eg, Perdue chicken).
Our product is different
(eg, Listerine).
Our product is similar
(eg, Meisterbrau). 3

5. Crowded Markets Consumers face increasing number of choices
Over 8,200 mutual funds
Over 150 models of cars
Over 30,000 products in a grocery store
Over 100,000 prescription drugs
If we can figure out in the crowd, we will have a better handle on our future profitability.

6. Marketing Opportunities Associated with Positioning
Find unmet (or inadequately met) customer needs and wants.
Identify product strengths that are unique and important.
Determine how best to overcome product weaknesses.
Identify market segments for which a particular product or new concept would be appealing.

7. An organic chemist reads diagrams such as the one here
An Electrical Engineer reads diagrams such as the one here
Positioning 7

8. Can You See Patterns in These Customer Data?
Ratings of nine brands of notebook computers on several attributes
B1 B2 B3 B3 B4 B5 B6 B7 B8 New
Attractive Light Unreliable Plain Battery life Screen Keyboard Roomy Easy service Expandability Setup Common Value Preference

9. Marketers Need to Learn to Read Perceptual Maps!

10. Conventional Mapping Using Snake Charts
Does not Describes it describe completely it at all
| | | | | |
1. Company provides adequate insurance coverage for my car.
2. Company will not cancel policy because of age, accident experience, or health problems.
3. Friendly and considerate.
4. Settles claims fairly.
5. Inefficient, hard to deal with.
6. Provides good advice about types and amounts of coverage to buy.
7. Too big to care about individual customers.
8. Explains things clearly.
9. Premium rates are lower than most companies.
10. Has personnel available for questions all over the country.
11. Will raise premiums because of age.
12. Takes a long time to settle a claim.
13. Very professional/modern.
14. Specialists in serving my local area.
15. Quick, reliable service, easily accessible.
16. A “good citizen” in community.
17. Has complete line of insurance products available.
18. Is widely known “name company”.
19. Is very aggressive, rapidly growing company.
20. Provides advice on how to avoid accidents.

11. Uses of Mapping Techniques
Check how customer perceptions of your products compare to those of your competitors.
Identify product strengths and weaknesses.
Select competitors to compete against.
Determine exactly how much change is need on key product attributes to move your products to more favorable positions.
Visually determine whether your communications programs are having the desired impact on market perceptions.
Compare perceptions from different demographic, geographic, or psychographic subgroups in your market.

12. Mapping Techniques Mapping perceptions Mapping preferences
Attribute-ratings methods (particularly useful for functional products)
Overall-similarity methods (particularly useful for image-oriented products)
Mapping preferences
Include an overall preference vector in a perceptual map
“External” analysis to fit preferences of individuals on a common perceptual map

13. Mapping Methods in Marketing
Joint Space Maps (includes both perception & preference)
Perceptual Maps
Preference Maps
Similarity-based methods
Attribute-based methods
Ideal-point model (unfolding model)
Vector model
External analysis using PREFMAP-3
Simple “joint space maps” using modified perceptual mapping methods
Positioning 13

14. Perceptual Maps Using Attribute Ratings
Example: Positioning of a new PDA concept
Select a set of PDA’s which are of interest to the target group of customers (including the new concept of interest).
Identify a set of key attributes on which these pda’s are evaluated by the target group (e.g., through focus groups).
Ensure that customers are familiar with the products of interest (e.g., through video presentation).
Have customers evaluate the products on the chosen set of attributes.
Light … Heavy (A1)
Unreliable … Reliable (A2)
Small … Large (A3)
Poor Connectivity …………………... Good connectivity (A4)
Poor value … … Good value (A5) . ..
Definitely would
not buy …..... Definitely would buy (Preference)

15. Example Plot of Attributes of PDAs on a 2-D Perceptual Map
(Poor Communication
capabilities)
(Difficult to use)
Newton 130 ·
Screen quality
· Sony PIC 2000
Image ?
Common
Large
Successful
Easy to use
Good Communication
capabilities
Connectivity?

16. Perceptual Map of Beer Market (Example from Book)
Heavy
Popular with Men
Heavy
Full Bodied
Old Milwaukee
Budweiser
Beck’s
Meister Brau
Special Occasions
Heineken
Miller
Blue Collar
Dining Out
Premium
Good Value
Coors
Budget
Stroh’s
Premium
Michelob
Coors Light
Popular with Women
Miller Lite
Pale Color
On a Budget
Old Milwaukee Light
Light
Light
Less Filling 17

17. Interpreting Perceptual Maps Another Example

18. Guidelines for Interpreting Perceptual Maps
The arrow indicates the direction in which that attribute is increasing (The attribute is decreasing in the direction opposite to the arrow). Thus, PDAs positioned farther and farther in the South-West direction are considered to offer “good value,” and those positioned in the North-East direction offer poor value.
The length of the line from the origin to the arrow is an indicator of the variance of that attribute explained by the 2D map. The longer this line, the greater is the importance of that attribute in helping you to interpret the map. Thus, “screen quality” and “expandability” are relatively more important than “economical” and “communication capabilities” in explaining how this group of customers discriminates between the PDAs.

19. Guidelines for Interpreting Perceptual Maps (contd.)
Attributes that are both relatively important and close to the horizontal (vertical) axis help you in articulating the meaning of the axis. Here, the two dimensions along which these customers seem to discriminate between the computers appear to be “Image” for the horizontal axis and “Connectivity” for the vertical axis. This interpretation can be based on attributes most correlated with the axes (Common, value, perceived success, etc. for the horizontal axis), and communication capabilities and connectivity for the vertical axis).
To position a PDA on each attribute, draw an imaginary perpendicular line from the location of that PDA onto that attribute. (These are shown by dashed lines on the map). Thus, Sony PIC 2000 is perceived to be easier to use than the Sharp 5800.

20. Mapping Preferences
Objective—Introduce customer preferences into perceptual maps:
A simple ideal point method (MDPREF): Introduce an “ideal” brand as an additional stimulus evaluated by customers.
1. Combine attribute ratings of ideal brand with the other brands.
2. Compare how similar the ideal brand is to the other brands included in the study.
A simple vector method (MDPREF): Introduce “preferences” as an additional variable in the ratings data
1. Analyze the preference variable simultaneously with evaluations of the cars on each attribute.
Identify which attributes influence consumer preferences the most
Identify which brands are most preferred in the aggregate.
2. Analyze preferences separately for each customer.
Identify target segments that prefer the brand of interest the most 15 19 15

21. Mapping Preferences cont’d
PREFMAP-3 external unfolding
Develop a perceptual map of competing alternatives by other methods.
Given the fixed positions of the alternatives, map the preferences of customers on the same map (this approach is called external unfolding). 20

22. Ideal-Point Preference Model Vector Preference Model
Two Preference Models
Ideal-Point Preference Model
Vector Preference Model
Increasing Preference
Preference
Preference
Decreasing Preference
Ideal Point
Attribute
Attribute
(eg, sweetness)
(eg, service speed) 21

23. Interpreting Preference Models
(a) A is preferred twice as much as B. (dIB = 2dIA)
Ideal-Point Map
Ideal Point (I) A B
dIB
dIA
Vector Map
Preference Vector A
dAC
dAB C B
(b) A is preferred to B and B is preferred to C. With reference to A, C is preferred half as much as B. (dAC = 2dAB) 22

24. MDPREF Vector Method for Representing Aggregate Preferences
Matrix of inputs:
A1 A2 A3 A A15, PREF
Dell 320N
C1 TI Travelmate
Toshiba concept
• • •
Dell 320N
C2 TI Travelmate
Toshiba concept
Note: A higher number on PREF indicates higher preference for that brand.
Compute average ratings of each brand on each attribute and the average preferences for each brand.
Submit data to MDPREF to obtain a “joint space” map showing relationships between brands and their evaluations on each attribute.
Interpret the map. The relative locations of the brands are directly provided by the map. The orientation of the attributes (including preference) are determined by drawing vectors from the origin to each attribute. The positionf a brand on an attribute is determined by drawing a perpendiclar line from the brand location to the attribute orientation. 23

25. Preference Map Using MDPREF Vector Model
Low battery life
Keyboard
Expandability
Toshiba
Elegant
Distinct
Unsuccessful
Avant-Garde
Heavy
IBM
Compaq
Fast operation
Reliable
Sanyo TI
Good design
AST Exec
Difficult to use
Dell
NEC
New Concept
Value
Graphics
Poor setup
Samsung
Screen quality
Preference

26. Data for PREFMAP-3 for Representing Individual Preferences
Matrix of inputs:
C1 C2 C3 C
Newton
HP200LX
Canon
• • •
An element of this matrix is the stated preference of each consumer (C1, C2, . . .) for each brand. A higher number indicates higher preference for that brand.
Submit data to PREFMAP-3 (in addition to perception data) to obtain a “joint space” map showing relationships between brands and preferences between brands for each consumer.
Interpret the map. The relative locations of the brands are directly provided by the map. The direction in which an individual consumer’s preferences are increasing is determined by drawing a vector from the origin to each consumer’s ID displayed on the map. The relative preference for a brand for an individual consumer is determined by drawing a perpendicular from the brand location to the preference orientation. Identify target segments by examining consumer groupings on the map. 26

27. A Joint-Space Map (This Example Only Shows Preferences and Brands)

28. Evaluating Perceptual and Preference Maps
Technical adequacy
What percentage of the total information (variance) in the raw data is captured in the map?
What percentage of the information of each attribute (variance) is captured in the map?
Managerial interpretation (example questions)
What underlying dimensions seem to characterize how customers view the products?
What is the competitive set associated with the target product or new concept?
How well is a target product positioned with respect to the existing products?
Which attributes are related to each other?
Which attributes influence customer preferences positively? negatively?
What improvements will enhance the value of a product or new concept?
Which customer segments have positive perceptions and high preference for the product?

29. An Example Positioning Statement
For [target segment], the [concept] is [most important claim] because [single most important support].
Example:
For PC Users, the IOMEGA Zip drive is the best portable storage device because it is most cost-effective system.

30. Some Positioning Themes
Apple iPod
BMW
Burger King
Charmin Tissue
Coke
Chevy Trucks
Colgate Total Toothpaste
Disney GE
Mobil Service Stations
Universal’s Orlando
Visa
Volvo
1000 songs
Exceptional performance
Have it your way
Softness
Authentic, real, original
Tough, strong, durable
Total dental protection
Wholesome family entertainment
Improves the quality of life
Fast, friendly service
Thrills, excitement, escape
Accepted everywhere
Safety

31. Initiating Positioning Studies in Companies
Four Questions to Get Positioning Studies Started
Who do we need to target?
What do they think now?
What do we want them to think, now and from now on?
How do we do that?

32. Implementing Positioning
Leverage strategically advantaged resources:
Product characteristics
features, performance, durability, conformance, reliability, style, etc.
Service attributes
delivery, installation, consultation, customer training, repair, etc.
Personnel
competency, credibility, courtesy, responsiveness, etc.
Brand image
symbols, emotion, personality, etc.

33. Limitations
Provides a static model - ignores dynamics of customer perceptions.
Interpretation is sometimes difficult.
Does not incorporate cost or likelihood of being able to achieve a desired positioning.
Does not incorporate a “probability model” to indicate goodness of a map.
Generally, need about 6 to 8 products in a category to make the technique useful.

34. Other Software for Perceptual Mapping
Standard statistical packages, such as SPSS, have routines for perceptual mapping (
Market Visioner:
BrandMap:
HierMaps: This is based on Correspondence Analysis