Improve Your Positioning Effectiveness

Companies that "control the controllables" begin with the fundamentals, and there is nothing more fundamental for branded products than positioning. Perhaps only the Bible has been written about more often than the art of positioning. So rather than an overall treatise on the topic, let’s focus on what is different about positioning in top companies vs. others.

Those that "control the controllables" understand that positioning is a function first and foremost of the competitive frame in which their brands compete. Broadly defined, the competitive frame is that array of products – often from diverse categories – that consumers use as direct substitutes in a given situation. Two things are critical: One, define the competitive frame much more broadly than traditional category definitions, and two, be explicit about which of these competitors a brand will source volume from. Only in this fashion can you be assured that your brand will focus on delivering the benefits that really matter.

In the example below, we highlight a choice that a fictional food company might face in determining a winning positioning for a brand of cheese-flavored crackers:

This fictional example illustrates the criticality of the choice of the competitive frame for this product. This choice determines the size of the market the brand competes in, the types of benefits that will be needed to win in this market, the target, the pricing and the customer strategy. In short, for top CPG companies the choice of competitive frame drives all the strategic elements of the brand’s positioning.

In the spirit of "controlling the controllables," we have found that just by improving the positioning effectiveness through this approach can yield 2-5% revenue growth and 1-3 % profit growth for even the most mature brands.

Of course, knowing where your brand competes from a consumer perspective is no easy task. A precise understanding of consumer usage beyond traditionally defined categories is critical. If the organization above only looked at its competition as the brands on the monthly market share report – that is, other cheese cracker brands – it would have missed an enormous opportunity.

Best-in-class companies get the knowledge they need via a rigorously defined Market Structure that expertly combines usage data and purchase information to identify the broadest competitive frame possible. These companies often do not have the capability within their organizations to build this type of Market Structure, and must turn to outside experts for assistance. Once created, however, the Market Structure becomes the foundation for all the other "control the controllable" strategies, including improving marketing and sales spending effectiveness.