business plan market positioning

Market Positioning

Over 1.8 million professionals use CFI to learn accounting, financial analysis, modeling and more. Start with a free account to explore 20+ always-free courses and hundreds of finance templates and cheat sheets. Start Free

What is Market Positioning?

Market Positioning refers to the ability to influence consumer perception regarding a brand or product relative to competitors. The objective of market positioning is to establish the image or identity of a brand or product so that consumers perceive it in a certain way.

For example:

• A handbag maker may position itself as a luxury status symbol
• A TV maker may position its TV as the most innovative and cutting-edge
• A fast-food restaurant chain may position itself as the provider of cheap meals

Types of Positioning Strategies

There are several types of positioning strategies. A few examples are positioning by:

• Product attributes and benefits: Associating your brand/product with certain characteristics or with certain beneficial value
• Product price: Associating your brand/product with competitive pricing
• Product quality: Associating your brand/product with high quality
• Product use and application: Associating your brand/product with a specific use
• Competitors: Making consumers think that your brand/product is better than that of your competitors

A Perceptual Map in Market Positioning

A perceptual map is used to show consumer perception of certain brands. The map allows you to identify how competitors are positioned relative to you and to identify opportunities in the marketplace .

An example of consumers perception of price and quality of brands in the automobile industry are mapped below:

This map is for illustrative educational purposes only.

How to Create an Effective Market Positioning Strategy?

Create a positioning statement that will serve to identify your business and how you want the brand to be perceived by consumers.

For example, the positioning statement of Volvo: “For upscale American families, Volvo is the family automobile that offers maximum safety.”

1. Determine company uniqueness by comparing to competitors

Compare and contrast differences between your company and competitors to identify opportunities. Focus on your strengths and how they can exploit these opportunities.

2. Identify current market position

Identify your existing market position and how the new positioning will be beneficial in setting you apart from competitors.

3. Competitor positioning analysis

Identify the conditions of the marketplace and the amount of influence each competitor can have on each other.

4. Develop a positioning strategy

Through the preceding steps, you should achieve an understanding of what your company is, how your company is different from competitors, the conditions of the marketplace, opportunities in the marketplace, and how your company can position itself.

What is Market Repositioning?

Market repositioning is when a company changes its existing brand or product status in the marketplace. Repositioning is usually done due to declining performance or major shifts in the environment.

Many companies, instead of repositioning, choose to launch a new product or brand because of the high cost and effort required to successfully reposition a brand or product.

Example of Market Repositioning

The example below describes Coca-Cola’s repositioning of Mother Energy Drinks:

The Coca-Cola Company launched Mother Energy Drinks in 2006 into the Australian market. The launch campaign was professionally executed, and Coca-Cola was able to leverage its distribution channels to get the product into major retailers. However, the taste of Mother Energy Drink was subpar and repeat purchases were very low.

Coca-Cola was faced with a decision: to improve and reposition the product or withdraw it and introduce a new brand and product. The company ultimately decided to reposition the product due to already high brand awareness.

The biggest challenge faced by Coca-Cola was to persuade consumers to try the product again. The company changed the packaging, increased the size of the can, and improved the taste of the product. The relaunch of the product featured a new phrase – “New Mother, tastes nothing like the old one.”

Ultimately, Coca-Cola was able to successfully reposition Mother Energy Drinks and the brand today competes with the two leading energy drinks in the market – V and Red Bull.

Other Resources

To learn more and advance your career, see the following free CFI resources:

• Natural Monopoly
• Law of Supply
• Command Economy
• Bargaining Power of Suppliers
• See all management & strategy resources
• Share this article

Create a free account to unlock this Template

Access and download collection of free Templates to help power your productivity and performance.

Already have an account? Log in

Supercharge your skills with Premium Templates

Take your learning and productivity to the next level with our Premium Templates.

Upgrading to a paid membership gives you access to our extensive collection of plug-and-play Templates designed to power your performance—as well as CFI's full course catalog and accredited Certification Programs.

Already have a Self-Study or Full-Immersion membership? Log in

Access Exclusive Templates

Gain unlimited access to more than 250 productivity Templates, CFI's full course catalog and accredited Certification Programs, hundreds of resources, expert reviews and support, the chance to work with real-world finance and research tools, and more.

Already have a Full-Immersion membership? Log in

The Complete Guide to Positioning in Marketing

Learn how to improve your positioning in marketing. We cover the benefits of positioning, types of positioning, examples, how to create a positioning strategy.

Manager of the Experts Success Team at Mayple

Learn about our

Natalie is a content writer and manager who is passionate about using her craft to empower others. She thrives on team dynamic, great coffee, and excellent content. One of these days, she might even get to her own content ideas.

Updated November 20, 2023.

There are probably hundreds or even thousands of companies that provide products or services similar to yours. They give similar promises and offer similar benefits, and thus they have a similar position in the mind of the average consumer.

Such a situation makes the consumer wonder why they should go for one company instead of another. They might feel like all the options are the same. As a business owner, your job is to show why your products are not the same as others’ products and why you can provide unique value to customers about your competitors.

The process of positioning is crucial for your marketing strategy and marketing efforts. This guide will help you learn how to distinguish yourself from your competition in the consumers’ minds, thus getting ahead of your competition in a highly competitive market.

What does positioning mean in marketing?

Positioning is one of the 4 P’s of the marketing mix and refers to the process influencing the consumer perception of your brand or a specific product you offer. More specifically, positioning is the process of creating a specific image of your brand with which your target customers will associate you, thus distinguishing you from your competitors.

As Ries & Trout say, “Positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. That is, you position the product in the mind of the prospect.”

Positioning is all about choices - choosing your place in the market. For example, a car manufacturer may emphasize the practicality of its cars, positioning them as quality vehicles for the average consumer instead of costly status symbols. Likewise, a fast food chain may position itself as a palace to get inexpensive and quick meals, unlike high-end restaurants.

On the other hand, a fashion brand may position its clothes as high-end status symbols with completely unique design choices. This would make it stand apart from other clothing manufacturers.

No matter what business you run, positioning is invaluable for showing consumers why they should pick your brand out of all the others. You need to create a distinct image and make it stick in your consumers’ minds to have a lasting impact and ensure they don’t forget you and the value you bring.

Positioning is somewhat similar to processes such as branding, value proposition, messaging, and differentiation. However, there are some key differences that we need to highlight to understand better what positioning is.

Positioning vs. branding

Branding refers to creating a unique logo, tagline, or slogan to create an original brand image . You can think of the McDonald’s logo and the recognizable “I’m lovin’ it” slogan. These two elements are unique to the company and instantly recognizable.

Positioning is similar, but its main focus is on creating a specific image or idea of your brand in your customers’ minds. For example, you might try to position your company’s products as more practical when compared to your competitors.

Positioning vs. value proposition

Positioning can also be confused with a value proposition. A value proposition is a promise you make to your customers regarding the benefits, use, and quality of your products or services. So a value proposition might be a part of the positioning, but it is not the same process.

Positioning vs. messaging

While positioning involves outlining the uniqueness of your products and services in comparison to your competitors, messaging is when you communicate how you’ll fulfill your promises to your target audience.

Positioning vs. differentiation

Since positioning is to a great extent about how different your product is from the competition, it might be easy to confuse it with differentiation. However, differentiation is a tactic you use to make a specific offer or product stand out and get more interest from the target audience.

The benefits of positioning in marketing

Now that we know what positioning is, we should examine its benefits in greater detail. Here are all the benefits of having good positioning.

Have a stronger position in the market

When you create a positive image of your company in consumers’ minds and associate your business with a certain value, you’ll attract more customers.

A successful positioning campaign will cement your position not only in consumers’ minds but also in the target market. The goal is to have consumers believe that your products and services provide more value than those of your competitors.

Increase sales

Improved positioning can lead to greater sales. Having a relevant offer and communicating information about your company effectively may allow you to get a bigger piece of your existing market and expand to new markets.

Better market to your target audience

Positioning also allows you to reach out to your target audience and better capture their imagination. This will allow you to market your products and services to your target buyers better. You will be able to address their needs and pain points effectively, thus turning them into more loyal customers.

Build a stronger brand

Positioning goes hand in hand with branding. While branding will give you a recognizable logo and slogan, positioning will ensure that your brand is associated with a certain value and that your (potential) customers see it in a certain way. And together they are part of an overall branding strategy .

You might position your business as one that provides convenience at a reasonable price. Such clear positioning will result in a strong brand because you’ll show that you have a clear focus and target demographic. Customers who prefer this kind of service or goods will know where to look for them.

Every brand must have a specific focus. A brand that tries to cater to everyone will end up catering to no one. And a great branding freelancer will be able to help you take your first-party data and create a brand that attracts your ideal customer.

Types of positioning in marketing

There are different types of positioning depending on what you want to focus on in your business. Let’s look at each one in detail.

For most consumers, a product’s price is a determining factor when they have to decide if they’ll buy something or not. A company that offers affordable products with reasonable quality will most likely have lots of success with customers if it positions itself as a low-cost brand with decent products.

A good example of this is Dollar Shave Club compared to Gillette. Even though Gillette was the leading company in the razor blade market, Dollar Shave Club took over a decent chunk of their market due to their unusually low prices and good quality.

The cheapest razor cartridge from Dollar Shave Club is only $0.20, which swayed many customers to their side. This enabled Dollar Shave Club to successfully take on a giant like Gillette. They have positioned their business around a competitive pricing strategy and it worked. They were acquired by Unilever in 2016 for a whopping $1 billion .

Quality is the determining factor for companies that sell products in the same price range. Think of the reason people buy Volvos - they are more expensive but are significantly better quality-wise than other cars. Consumers for whom product price is not an issue will want to get the highest possible quality.

Chipotle and Taco Bell are good examples of this. Chipotle was able to get a good part of the market share when it focused on quality instead of price.

Competitors

When positioning your brand, you must also emphasize the ways in which you’re better than your competition. This can refer to your superior customer service, top-notch experts that you hire, or better standards of production.

Convenience

Sometimes your biggest strength might be the convenience you offer to your customers. It can refer to the sheer number of your stores or office, accessibility, multiple-platform support, or ease of use of your application(s).

A convenience-based positioning strategy attracts busy customers, who are often willing to pay extra to save time. And while it can get you greater profits, it can also cost more. For example, if you’re offering a mobile app and a desktop version of the app, you can get more customers, but you’ll need to spend more on development.

Customer needs

If you want to get and retain customers, you must be ready to quickly and efficiently meet their needs. Consumers are generally happy to pay a premium price if they know that any problem they might have with the product will be solved quickly and efficiently.

On the other hand, If consumers perceive you as cold and disinterested, they’ll rather opt for someone else, even if your goods or services are top-notch.

Positioning your company around your customer and their needs is a powerful strategy that helps cement your position in the market.

Product use

Another thing you can focus on is the intended use of your product(s) and its characteristics. It’s impossible to create products that customers can use for everything and in every situation, so you have to focus on a particular characteristic and use it to stand out.

For example, Volvo emphasizes the safety of its vehicles, and drivers who prioritize that characteristic know where to turn when buying a car. On the other hand, drivers that prefer reliability will turn to Toyota, as the company positions itself as a manufacturer of reliable cars.

Examples of positioning in marketing

Now that you know the different types of positioning here are a few great examples from the world’s most famous brands. These examples will deepen your understanding of positioning and they might give you some useful ideas you can use in your marketing efforts.

1. Tinder and Bumble

Tinder and Bumble are two of the biggest names in the dating industry and they rely on different positioning strategies to attract new users and retain the ones that they have.

Tinder tries to position itself as a leader in the industry by drawing attention to its large number of users ( 75 million and counting) and its long presence in the market. That’s an important factor for potential users who would like to have a wide pool of potential dating partners.

On the other hand, Bumble uses its unconventional approach to position itself as a game changer in the industry. Bumble is specific because it only lets women initiate conversations, and it also offers users to look for friendships and business connections.

Therefore, Bumble relies on differentiation to stand out from the competition and present itself as an innovative alternative to its competition.

2. Apple Music and Spotify

Apple Music and Spotify are bitter rivals when it comes to music streaming. Even though their services are similar, their positioning strategies are quite different.

Spotify relies on a price-based strategy. While it has a premium option that makes it very similar to Apple Music, it also offers a free plan that attracts many users. Additionally, it offers a great degree of personalization that allows users to enjoy their favorite music and discover new artists with only a few clicks.

Apple Music focuses on its status as a prestigious service. It emphasizes its impressive catalog of 60 million songs and exclusive features such as on-screen lyrics and music videos, which Spotify offers for only a few songs.

3. Walmart and Target

The rivalry between Target and Walmart can also give us a great example of different positioning strategies. While both chains offer similar products and prices, their positioning is vastly different.

Walmart competes on price and offers the best-priced goods in the market. This has some drawbacks and it has earned them an interesting reputation but customers know that if they want to get the best deals they should go to Walmart.

On the other hand, Target focuses more on customer experience and product quality. Target stores tend to be better organized, and the customers find the experience much more enjoyable than the one they might get at Walmart.

4. Popeyes vs. Chick-Fil-A

Both companies serve tasty fried chicken but with very different approaches. Popeyes focuses on differentiation, while Chick-Fil-A focuses on its quality and customer service.

Popeyes’ main focus is on home style, Cajun recipes, and food that are different from many other similar chains. This allows them to stand out from the crowd and be recognizable for their food.

Chick-Fil-A emphasizes the quality and general appeal of its food to position itself. However, their strategy is hybrid because they also rely on customer service . They don’t brag about it, but they let their employees’ actions speak for themselves, so they’re recognized as a place where customers feel well-treated.

How to create an effective positioning strategy

Here is a step-by-step process for creating an effective market positioning strategy for your business.

1. Define your current position

Before you dive deep into the positioning process, you must first determine your current position in the market. Do prospective customers see your products as just another thing on the market, or do they see them as something unique? Conduct some research to determine how your products are perceived by your target audience.

After that, you must determine who your potential and ideal customers are and how you can connect to the typical buyer persona. If you have a wide range of products, segmenting your customers is also a good idea. This will help you create campaigns that cater to specific market segments.

2. Analyze your competitors

Competitor analysis is just as important as analyzing your own position in the target market. Conduct a SWOT analysis to see how you stack up against your competitors. Identify the weaknesses you need to address, as well as the strengths you should emphasize.

Pro tip : take note of your competitors' marketing channels, tactics, and advertising campaigns, and record all of those in your marketing plan . Refer back when you need fresh ideas of what works in your target market.

3. Create a positioning map

Positioning maps are a visual representation of how you compare to your competition based on certain attributes and values they find important. It’s a super helpful tool that helps you see a clear picture of the strengths and weaknesses you and your competitors have.

4. Tweak your current position

Once you know what you need to work on, you can start tweaking your position. Emphasize your strengths compared to your competitors and convince your potential customers that your business is the place to go if they’re looking for a certain value.

This value should be the one you’ve identified as your strong point and decided to push forward as a factor that differentiates you from the competition. This should also be the value you associate with your customers’ needs.

5. Create a positioning statement

Your positioning statement should be one or two sentences long and briefly state your mission and goals. It should emphasize your uniqueness compared to your competition.

It consists of three elements - what you do, who your target audience is, and the greatest benefit that your product provides.

For example, here’s a compelling positioning statement from Amazon: “Our vision is to be the Earth’s most customer-centric company, to build a place where people can come to find and discover anything they might want to buy online.”

This statement summarizes their goals and proof of the statement has become self-evident. Amazon offers basically anything you might want to buy, it’s all available at the click of the mouse, and it's delivered to your doorstep.

6. Create a tagline

A tagline is better known as a slogan. A good slogan can be almost synonymous with your brand and will do an excellent job showing your customers what they can expect from your company.

We’re all aware of slogans such as “Just do it” from Nike or “Because you’re worth it” from L’Oreal. Those slogans are instantly recognizable and tell consumers exactly what they can expect from the companies.

7. Test your marketing positioning

Once you’ve prepared everything essential for positioning, it’s time to put it to the test. It takes time until your customers’ perception of your business changes into what you want it to be. This allows you to track the progress of your positioning campaign and make changes.

Don’t expect your positioning campaign to be effective immediately. It’s almost impossible to do everything perfectly right away, so embrace the effort and know that it’s a process.

Looking to position your company?

If you’re serious about standing out and conquering your competition, you need to have a successful positioning strategy.

It could seem daunting but you don’t have to do it alone. Hire the perfect marketing consultant through Mayple and get the job done. Get started now and start working on a killer positioning plan!

What is the meaning of market positioning?

Market positioning refers to shaping the consumer perception of your brand, company, or products. Brands position themselves by creating an image or identity of the brand or product so that consumers view it in a certain way. It’s an important part of your marketing mix and serves to strengthen your brand and improve sales.

What is the importance of market positioning?

The objective of market positioning is to stand out from the competitors and show your uniqueness to the customers. It associates your company with certain values and characteristics, and people will know they should turn to you if they’re looking for those values and characteristics.

It's important for companies that want to develop better messaging for their target segment, improve their current market position, and increase sales.

What is meant by positioning in marketing?

Positioning is how consumers see your brand. In other words, it refers to the values you want your customer base to associate you with. It can also refer to how consumers see your product in relation to other products on the market. Good positioning makes your product unique in the eyes of your target segment and helps display the benefit it provides for them.

What are the 5 positioning strategies?

The five positioning strategies are: quality positioning, convenience positioning, customer needs positioning, product positioning, and competitive positioning.

What are the 4 types of product positioning?

There are four types of product positioning: price-based positioning, lifestyle-based positioning, characteristics-based positioning, and quality-based positioning. You can also use a combination of two types of product positioning together to make your product stand out in the market.

What is an example of positioning?

Volvo is a good example of positioning in the car industry. The company emphasizes the safety of its vehicles, so consumers who prioritize that characteristic know that Volvo is the best option for them.

Why is positioning important?

Positioning helps you boost sales, attract your target audience, and create a unique image of your company. This makes you a recognizable force in the target market and cements your position in your customers’ minds.

What are the 4 Cs of positioning?

The four Cs of positioning are clarity, consistency, competitiveness, and credibility. They tell what your main focus should be when working on your positioning. They were created by David Jobber and John Fahy in their book "Foundations of Marketing" (2009).

Related Articles

Sandra Stepan

The Ultimate Guide to Social Media Marketing: Tips, Strategies & Tools [2024]

Ben Kazinik

What is Search Advertising? How it Works + Top Strategies [2024]

Jacob Elbaum

When to Start Conversion Rate Optimization?

Aishwarya Ganji

12 Must-Have Skills For Every Social Media Manager In 2024

The Ultimate Guide to Omnichannel Analytics

Market Positioning – Definition, Types, Benefits, Examples & How-to

Imagine you want to be, let’s say,  a detergent manufacturer, and there are thousands of other detergents in the market.  Why do you think customers will buy your detergent from a cluster of “million options”?

However, if your detergent has unique features that can give your customers unique benefits, then that is a different story. People don’t want to buy a product that claims to do “everything.” Instead, they want a better solution that can tackle at least “something.” You just need to show them that your detergent can specifically do “this.”

 To cut it short, you need to position your product or service uniquely. In marketing terms, this is called market positioning. Why is market positioning important, and what are your options regarding market positioning? Let’s find out.

Table of Contents

What Is Market Positioning?

Market positioning, in simple words, is a marketing strategy that focuses on creating a unique image or perception of a brand, product, or service in the customer’s mind. A business can create that unique image by any means.

For instance, the four Ps of marketing (promotion, product, price, and place) are important factors in market positioning. The more a business focuses on these 4 Ps, the will better will be its positioning in the market. Still not getting a clear picture of market positioning? Here are some examples for basic understanding:

• A shoemaker specializes in making formal shoes for highly sophisticated or formal events.
• A fast-food franchise that makes unique grilled beef burgers.
• A car manufacturing company specializes in manufacturing luxury cars with unparalleled features.

So, what was the basic theme in these examples? The sellers in these examples are focusing on a specific niche rather than catering to a general audience.

Types Of Market Positioning

Different businesses use different techniques for market positioning. However, here some of the most common types of positioning in the market.

Quality of A Product or Service

Amidst the fearsome price wars, many brands strive hard to provide quality. Yes, when you please your customer with unparalleled quality, price becomes a less-concerned issue.

Example. Chipotle has quickly gathered immense fame and climbed to the 14 th spot in the list of top 50 fast-food franchises in the USA (ranking from QSR magazine). This quality-oriented brand has already captured a significant market share and causing trouble for “big boys.”

Innovation and Uniqueness

Many brands focus on providing innovation and uniqueness. If you can bring something new and fascinating, you can charge higher prices and people will pay for it happily.

Example. What would be a better example of innovation than Apple? The electronics industry’s juggernaut has captured a massive global market just because of its mind-blowing and surreal innovations.

Price of A Product or Service

When a brand is not enriched with innovation or superior quality, then pricing is an excellent option to challenge your competitors. Whether you accept or not, price is still one of the most critical factors that affect many consumers’ purchase decision.

Example. Dollar Shave Club has proved to be a nightmare for Gillette because they offer the cheapest razor cartridge refilling (20 cents) while Gillette was doing it for $2-$5. Due to this massive difference, Gillette has seen a decreasing market share.

Product Differentiation

Similar to innovation, product differentiation is another excellent marketing strategy to take the lead. A different product or service can easily kill the competition.

Example. Tesla has revolutionized the automobile industry with its electronic cars. This has sidelined many economic cars such as Toyota Prius.

Customer Service

Customer services , if appropriately managed, can create a massive and defining image in consumers’ minds. In fact, this category is fundamental in specific industries such as banking and restaurants.

Example. Zappos, an American online shoe company, has unique customer service practices. They respond to every single email they get, even if the email is directly for the company’s CEO.

Niche Segregation

Targeting a micro-level market segment is another super-effective way of market positioning.

Example. Axe, also known as Lynx, is a famous British brand that focuses on male grooming products such as body sprays, deodorants, etc., for young males.

Advantages of Market Positioning

Market positing can help a brand in “countless” ways but here top five of them:

Increase in Revenue

Marketing positioning is purely dedicated to creating a unique image of any specific brand. When a brand succeeds in creating a unique market position, its revenue increases due to a boost in sales volume.

Built A Competitive Edge

Market positioning also helps brands to create a competitive edge. Either you are following a pricing strategy or focusing on providing quality products or services, you develop a competitive advantage when you position your brand in the market. Everything your competitors don’t have is a competitive advantage, whether it is your offering’s price, uniqueness, or quality.

Easy to Promote A New Product

A company that has already positioned itself in the market can launch a new product and penetrate the market easily. This significantly reduces marketing costs as well.

Create A Brand Identity

Brand identity is highly dependent on market positioning. Only proper marketing positioning can develop an image or perception in a customer’s mind.

Marketing Positioning Simplifies the Purchase Decision for Customers

Customers want easy options and solutions while making a purchase decision. Positioning allows them to determine what kind of benefits they will get from a specific product or service. It ultimately simplifies their buying process.

How To Create A Successful Market Positioning Strategy

The market positioning strategy of any brand should be based on its core objectives. Companies should be clear as to how do they want their customers to perceive them. Here are some “must-do” practices to develop a thriving market positioning strategy.

Identify Your Strengths Through Competitor Analysis

Identifying the differences between you and your competitors is mandatory. This ultimately helps you to determine your strengths and how you can use them to take advantage of opportunities.

Analyze the Current Market Position

Before you decide to position yourself in the market, it is better to evaluate your current position. This will assist you in differentiating yourself from your competitors.

Detailed Competitor Positioning Analysis

Apart from identifying your strengths, it is equally important to analyze your competitors’ strengths and how they can challenge you.

Create Your Market Positioning Strategy

Once you have examined the factors mentioned above thoroughly and understand your position, strength, and opportunities, develop your positioning strategy accordingly.

Positioning Errors That A Company Should Avoid

Excess of everything is bad, and the same is the case with market positioning. If a brand makes too many “promises” and claims to be the best, things may go south easily. So, here are some of the common mistakes marketers commit while developing positioning strategies:

• Confused Positioning. Making too many claims and frequently changing the product features can make the customers confused about brand image.
• Over Positioning. Over positioning means that a firm has gone way too specific in niche selection that only appeals to very few customers. It becomes challenging for a company to achieve its sales target with such a low number of potential customers.
• Under Positioning. Under position, in simplest terms, means that a brand has failed to create a unique or differentiated image in customer’s mind.  That said, the customer fails to differentiate a specific brand from others.
• Doubtful Positioning. Doubtful positioning can be best described as “it’s too good to be true.” That said, it is a situation where customers become doubtful about the claims made by the brand because they look suspicious or unreal. This usually happens when a product’s price, physical features, etc., fail to match with the company’s claim.

Examples of Market Positioning

It will be an injustice if we don’t talk about Tesla as one of the best market positioning examples. The company has taken “price” out of the equation and only focuses on providing unparalleled quality to its customers. Tesla is more of a luxury brand, and its vehicles are:

• Eco-friendly
• Large-ranged

One of the best and globally admired brands, Nike has positioned itself in the market as an innovator with a high focus on performance. The waffle shoes from Nike have become the most expensive sneakers in the world. After bossing the “shoes” category, Nike is now offering performance-boosting sports attires.

The finest portrayal of “inbound marketing,” HubSpot developed a huge customer-oriented platform by offering helpful content to its readers. HubSpot is:

• User-friendly
• Customer-centric, and

Which makes it an automatic choice of many consumers around the globe. Apart from that, HubSpot has become an “all-in-one shop” that deals in:

• Marketing automation
• Sales and service

It won’t be wrong to say that Starbucks has revived the tradition of coffee consumption in the USA. That is because the country had witnessed a decrease in coffee consumption since 1960. Starbucks, therefore, carefully targeted office workers who were interested in purchasing a high-quality product.

Coffee is considered as a soothing and relaxing beverage in the US, and Starbucks has always been vigilant to live up to the expectations.

About The Author

shaharYar Ahmad Ranjhaa

How to Create an Effective Market Positioning Strategy

Aug 12, 2023

14 min. read

Your market positioning strategy is a key element of brand development. It helps guide content marketing plans, influencer marketing tactics, pricing and distribution models, and even has an influence on decisions made outside of the marketing department too. But the concept of positioning can be a little ambiguous, as can the strategies used to cement it. So in this post, we’ll delve into all you need to know about product positioning; let’s begin by clearing up what we mean by this term.

Table of Contents

What is market positioning, how to kick start your market positioning strategy.

Branding and digital marketing expert,  Phil Kotler  (also known as the "father of modern marketing”), defines market positioning as “the act of designing the company’s offering and image to occupy a distinctive place in the mind of the target market”. In general, strategic positioning is used to influence the perception of an organisation or product in relation to others in the market. The idea is to create an image and identity that audiences recognise as being a certain way.

Perception is complicated. You see, they vary from person to person and like reputation, it’s fragile - it can take years to craft and seconds to shatter. But if it’s so temperamental, why are professionals investing millions into strategic positioning? Well, there are a number of very attractive advantages to benefit from, including (but not limited to):

• Heightened awareness
• Differentiation
• Charging premium pricing
• Increased recall
• Improved market and customer-centricity
• Helping companies to bounce back from crisis
• Increased brand equity

With advantages like the above, it’s pretty understandable why so many teams strive to have a clear-cut brand positioning strategy. If you’re wondering how you can too, you’ve come to the right place. During this article, we’ll walk you through all you need to know about strategic positioning so you can reap the above awards also!

Conduct a competitive analysis

In order to create a unique positioning in marketing, you first need to understand how you compare to other companies in your space. This can be achieved through strategic competitive intelligence and assists you with understanding aspects like:

• Who are your main competitors?
• How much influence does each of your competitors have on each other?
• What key themes are associated with each competitor?
• Are certain competitors thought of more favourably?
• What does the consumer like and dislike about them?
• Where they’re performing and where they’re falling flat?
• How is the industry performing?
• Where do the opportunities and threats lie?
• How does your organisation compare and contrast amongst others in your category?

Once you have the answers to the above questions, your competitive positioning will become clearer. We don’t want to sound like a broken record and repeat past competitive analysis tips we’ve already shared, so instead, you find useful resources on this topic below:

• How to Perform a Competitive Analysis
• Competitor Benchmarking: What It Is and Why It Is Important

Plot a market map

Next, using the insights gathered from your competitive analysis, create a perceptual map that shows your competitive positioning. A perceptual map, sometimes referred to as a position map or market map, is a visual representation of how competitors are positioned in relation to your organisation. Through market mapping, you can better understand the thoughts and behaviours of consumers, spot industry trends and see gaps in your category, helping you create a unique and differentiated identity.

Maps takes the form of a matrix which is usually represented by two or more attributes that you rate on a scale, for example, from high to low. While famous scholars such as Keller tend to focus on ‘price’ and ‘quality’, you might find plotting other attributes on the axis more helpful, such as:

• Quality vs Price
• Functionality vs Price
• Healthiness vs Tastiness
• Price vs Performance
• Price vs Safety & Reliability

 Not created this type of map before? We’d recommend checking out  GroupMap’s free tool  and reviewing this article which  offers tips on plotting and reading such maps . We’d also advise reading this HBR article,  A Better Way to Map Brand Strategy , which introduces a more advanced type of map known as a centrality-distinctiveness (C-D) map. Traditionally, companies have analysed brand positioning and business performance separately, the difference with C-D maps is that they allow companies to directly connect a brand’s position on a perceptual map alongside business outcomes such as sales.

Write a positioning statement

By now you should have a good idea of how you want to be perceived, the next step is to formalise thoughts and develop a statement.

As  Hubspot  explains, a positioning statement is a brief description of a product or service and target market, and how the product or service fills a particular need of the target market. It's meant to be used as an internal tool to focus and align efforts with the brand and value proposition. Unlike value proposition statements which describe through an overview of the benefits a product or service/ what sets your product or service apart from competitors, positioning statements are created after you've developed your business' value proposition and identifies only the primary customer benefits and points of differentiation.

Here are a few positioning statement examples to spark inspo.

G2 Crowd  positioning statement example: G2 provides a B2B review site for business professionals who are looking to quickly discover, buy, and manage  the best technology  for their needs. Unlike other B2B review sites, G2 offers 700K+ unbiased and verified user reviews in over 1400 categories.

HubSpot  positioning statement example: Since 2006, HubSpot has been on a mission to make the world more inbound. Today, over 68,800 total customers in more than 100 countries use HubSpot’s award-winning software, services, and support to transform the way they attract, engage, and delight customers. Comprised of Marketing Hub, Sales Hub, Service Hub, and a powerful free CRM, HubSpot gives companies the tools they need to Grow Better.

Tips to follow when writing a positioning statement:

• Keep your statement short and sweet
• Make it unique
• Keep your statement aligned with your core values
• Don’t forget to include your promise
• Explain why your company is different
• Follow the below positioning statement example formula as a rule of thumb:

For [your customer], [your company] is the [your market] that best delivers on [your promise] because [your company] is [your evidence].

Consider the strategic market positioning signals you’ll use

Now you that you understand your positioning and have summarised this in a statement, it’s time to think about what marketing positioning strategies you’ll use. Let’s take Louis Vuitton as an example. This is a company that’s known for being high-end and highly valued – but that didn’t just happen by chance. A team of marketing experts carefully crafted that perception through a number of signals (or strategic positioning strategies). Let’s explore some of those signals in more depth.

More often than not, price is a key factor in the  customer journey  decision-making process and what customers come to expect from a business is usually determined by this signal. While the old saying "you get what you pay for" is cliché, audiences truly believe in this mantra. Because of this, marketing teams use their pricing strategy, be it low or premium, to occupy a distinct image and dictate how prospects perceive the value offered. Positioning solely on price is dangerous territory though. As John Michael Morgan explains in his book 'Brand Against the Machine', “one of the problems with trying to be the cheapest price is that it's far too easy for someone to come along and price their product or service lower. Low price positioning means your business might as well be standing on quicksand. There is no loyalty for businesses positioned on the low end of price as the customer will go to who is offering the lowest." With this in mind, marketing professionals rarely use pricing as a key differentiator.

Perceived quality

Price and perceived quality usually go hand in hand, which is why they’re often the go-to attributes for perception maps amongst scholars. Consultant and Professor, David Aaker, states that perceived quality has three prongs: 1. Objective quality, which is based on the performance of the brand 2. Manufacturing quality, which is based on how defect-free the brand is 3. Product-based quality, which is associated with features/ parts/ ingredients/ services Say you have two TVs, one is a 4K plasma smart TV with after sales care and the other is a bog standard entry-level model. You may think that the entry-level TV will naturally be perceived as being lower quality as it has fewer features, but truth is, positioning in marketing requires you to have an understanding of what quality means to different customer segments. If certain audiences prefer to look at the manufacturing spec/ materials used and the entry-level TV comes out top, consumers will deem that to be of better quality regardless of the product attributes of the plasma TV. Moreover, the plasma TV may be produced by a company that has a history with product recalls, in which case, consumers are likely to think that entry-level TV is still better quality. 

So to summarise, it's important to achieve perceived quality on a dimension that consumers consider important. Want to learn more about better understanding your target audience and their decision making process? Check out our  Meltwater Audience and Consumer Insights tool or take a look at the best consumer insights tools in comparison !

Corporate endorsements

Another positioning signal often leveraged by marketing and branding pros is corporate endorsements. While McDonald's is known as being a fast-food company, they tried to dispel their unhealthy image through  their London 2012 Olympic sponsorship . Despite the sponsorship confusing people at first, it gave McDonald's the publicity and platform they wanted to raise awareness around obesity. In line with their sponsorship, they unveiled a large-scale promotional push which took place throughout the duration of The Games and included activity toys with Happy Meals and vouchers for sport sessions. As a top-tier International Olympic Committee sponsor, McDonald's was also the only branded food in the Olympic Park and the Athlete's Village. The messaging strategy? If a Big Mac is good enough for the world’s top athlete’s it's good enough for you (in moderation… of course)!

Influencer marketing

Following on from the above, influencer marketing can also significantly help positioning efforts. Since consumers often find influencers more credible as the message doesn’t directly come from a company, it’s a great strategy to use for those wanting to influence how their organisation is perceived amongst those they're targeting. With that being said,  choosing the right influencers to endorse your brand  is critical. Make the wrong decision and your business can end up being positioned in a totally different direction than what you set out to achieve. Thankfully we don’t have to rely solely on our gut feel when choosing influencers as there are tools out there that can do the job for us.  Meltwater’s Social Influencer Management solution  is one example.

Tip: These are the best social influencer management platforms and social influencer marketing platforms .

Thought leadership

Think Marketing  defines thought leadership as a “communication strategy that positions your brand as a leading authority on a specific industry/category/subject”. Lots of companies choose to include thought leadership in their content marketing strategy and  frame their executives as experts on certain topics  knowing this has a positive effect on product positioning too. Thought leadership is useful for all organisations, but it’s especially helpful for those wanting to break into a new category as it can make employees seem more credible and trustworthy.

There are thousands of examples of thought leadership online, but as an animal lover, one of my favourites has to be  Lush cosmetics . To strengthen their cruelty-free product positioning and brand promise, Lush often gets involved in lobbying for animal rights. They even have their own award,  The Lush Prize , which is the largest prize fund in the non-animal testing sector, awarding £250,000 to support initiatives that end or replace animal testing.

Distribution

Your distribution strategy can say a lot about you and your positioning. For example, choosing to sell your goods in convenience stores doesn’t scream luxury. Moreover, products sold in convenience stores also tend to be lower in price as they need to match the consumers browsing mindset. It’s unlikely that customers will pop out to get a pint of milk or loaf of bread and come home with a £1,000 TV – but if it’s lower-priced, you might just trigger that impulse buy! When selling goods through retailers, businesses also have less control over promotional efforts. This is why it’s rare to see extremely exclusive brands in department stores – yes, even the fancy ones! Such companies prefer owning their owns stores, and in most cases, rarely offer promotions – a strategic tactic that helps strengthen their exclusive market positioning too!

Measure if you’ve successfully influenced positioning in marketing with these 3 methods

Now there’s no use in putting all this effort into strategic positioning if you’re not going to measure whether or not your decision has successfully moved the needle. As mentioned earlier, perception is complicated – but that doesn’t mean it can’t be analysed. Below you’ll find 3 marketing analysis strategies to lean on when trying to understand if you’ve influenced how your target audience perceives you.

Media Monitoring

Use  media monitoring and measurement  to see if the thought leadership angles you're targeting and tactics used are resonating. You can do this by measuring how many times your organisation is mentioned alongside conversations related to the thought leadership angles you set out to drive. You can even measure how prominent your company is within the conversation, for example, are you mentioned in the title of the article or alongside a bunch of competitors?

Audience analysis

Use a  consumer analysis tool  to understand if there’s a difference in the types of  tribes following you on social media . This can be achieved by looking at dimensions such as audience affinity, how your target audience describes themselves in their bios, other types of companies they follow, and so on. This is especially useful if you want to measure whether you’ve successfully changed the type of target audience you’re marketing to.  

Hold a focus group

Brand salience is the degree by which your company is thought of or noticed by consumers when they make a purchase decision. Focus groups are a great way of qualitatively measuring brand salience. For example, you can ask the consumer what company comes to mind when they think of marketing analytics. If they recall yours, it’s a good indication that you have strong positioning.

Hopefully, by now you have a better understanding of what is meant by positioning in marketing, understanding your competitive positioning, how to write a market positioning statement, as well as the types of strategies and tactics you can use to change how your business is perceived. To wrap things up, I wanted to share one example of a brand that did this well...

Back in 2012, Kodak was on the brink of extinction - but only 8 years later, it's a force to be reckoned with. When Danielle Atkins, Chief Brand & Marketing Officer, joined the company in 2014, she helped Kodak reignite its relevance and gave it the breath of fresh air needed within the youth demographic. By harnessing the latest trends, collaborating with influencers and captivating audiences, Kodak now has a new lease on life! Ever the curious ones, Meltwater partnered with Atkins on a webinar so we could better understand the steps she took to achieve this! Curious too? Listen to the  on-demand recording  and hear Danielle explain how you too can re-energise your brand, in both the B2B and B2C spaces, with a carefully put together marketing strategy. 

Continue Reading

What Is The Marketing Mix? 4Ps & 7Ps of Marketing

Why You Need a Marketing Communication Strategy

What Is Marketing & Why Your Business Can't Do Without It

Global business

How to Build the Right Market Positioning for Your Product

For any growing business setting out on a global expansion journey, market positioning becomes one of the first crucial steps. It’s all about effectively differentiating yourself from competitors and creating a unique value proposition for customers.

Think of Coca-Cola and Pepsi for a moment: Although they offer similar products, both have distinct identities. Coca-Cola is positioned as a timeless, traditional beverage, while Pepsi is perceived as a youthful, energetic alternative.

To help you, too, make the most of this opportunity, this comprehensive guide will walk you through the essentials of market positioning—from its meaning and common types to the benefits and key strategies for lasting success.

What is market positioning?

Market positioning is the strategic act of establishing a unique and favorable perception of a product or brand in the minds of consumers compared to competitors.

Essentially, market positioning makes a promise to customers, conveying the value a company offers above other options and showing why it’s the best choice.

When positioning a brand, businesses should go beyond simply selling a product or service and deeply understand the needs and preferences of their target audience during market entry .

Conducting extensive market research and analyzing consumer behavior can provide a business with valuable knowledge on each target market that they can use to position their offering effectively and prepare for market expansion .

Brand vs product positioning

Brand positioning and product positioning are distinct, interconnected concepts that make up every strong market positioning strategy. While brand positioning creates the overarching perception of the brand, product positioning shapes how a particular offering is perceived compared to competitors.

• Brand positioning creates a unique and compelling brand image in the minds of consumers: It shapes your customers’ overall perception of your brand, including its values, personality, and associations.
• Product positioning aims to establish a specific product within the market:  It emphasizes the unique features, benefits, or solutions your product offers.

Free download

5 traps to avoid when thinking about launching a global product

Most people ignore products in languages that they don’t speak, so give yourself the best chance of success by avoiding these 5 common mistakes in global expansion.

Download guide

Why is market positioning important?

Without effective market positioning, you run the risk of leaving your brand and product reputation to chance. At best, consumer beliefs and images of your offerings may fail to reflect your goals. At worst, harm to your brand impacts your profitability. That’s why it’s essential to get market positioning right the first time. Let’s have a look at some of its core benefits. 

• Market positioning allows businesses to establish a unique identity in the market: When you differentiate yourself from competitors, you can attract customers who seek specific benefits or solutions.
• It also impacts consumer perceptions and purchasing decisions: When a product is positioned effectively, your customers are more likely to perceive it as superior and willingly pay more.
• Finally, market positioning helps businesses build long-term customer loyalty: By consistently delivering on their promises, companies can develop a strong brand reputation and create a loyal customer base.

Types of market positioning

You have many positioning choices available to you depending on the nature of your product or brand. Each type of market positioning strategy caters to different customer needs and competitive landscapes. The key types of market positioning include:

• Product attributes positioning: This positioning type focuses on specific product attributes that differentiate it from competitors. For example, a smartphone company may position its product as having superior camera quality compared to other brands.
• Price positioning: Price positioning involves positioning a product as being affordable or targeting a specific price range. Companies may position their products as high-end and premium priced or as value-for-money options.
• Quality positioning: Quality positioning emphasizes the superior quality of a product compared to competitors. Companies may highlight factors such as durability, reliability, or exceptional craftsmanship to justify a higher price point.
• Usage positioning: This type of positioning focuses on the specific use or application of a product. For example, a laundry detergent may position itself as the best choice for removing tough stains.
• Competitor positioning: Competitor positioning involves directly comparing a product to competitors. This type of positioning is commonly used when a product offers clear advantages over competitors in terms of features, performance, or pricing.

Successful market positioning examples

To illustrate the concept of market positioning, let’s explore some real-life examples of successful marketing positioning:

• Apple: Apple has positioned itself as a brand synonymous with innovation, high quality, and user-friendly design (“Think Different”). Its products are known for their sleek aesthetics, intuitive interface, and seamless integration across devices.
• Volvo: Volvo has positioned itself as a brand synonymous with safety (“For Life”). Its vehicles are known for their advanced safety features and commitment to protecting drivers and passengers.
• Nike: Nike has positioned itself as a sports and fitness brand that inspires customers to push their limits and achieve greatness (“Just Do It”), emphasizing empowerment and motivation in its marketing campaigns.
• Airbnb: Airbnb’s market positioning (“Belong Anywhere”) revolves around providing unique travel experiences by offering accommodations that allow travelers to feel like locals and truly immerse themselves in the destinations they visit.
• Coca-Cola: Coca-Cola has positioned itself as the classic, timeless cola beverage, with its latest tagline (“Taste the Feeling”) highlighting the emotional connection that consumers have with Coca-Cola’s refreshing taste.

What is a market positioning strategy?

A market positioning strategy refers to the overall approach a business takes to position its product or brand in a target market. An effective market positioning strategy clearly defines the 4 Ps: product, price, place, and promotion.

With a market positioning strategy, you ensure that you understand customer needs and have both a unique selling point (USP) and a unique value proposition (UVP). It will also guide all promotion efforts and shapes how a company communicates with its target audiences. By consistently delivering the message and reinforcing the desired image, your business can build brand awareness and loyalty among consumers.

How to develop a market positioning strategy

Developing an effective positioning strategy requires careful planning and consideration for companies to create a strong market presence and gain a competitive edge.

By understanding the target audience, identifying the USP, analyzing the competition, and effectively communicating the desired image, companies can create a strong market presence and gain a competitive edge.

Here are some essential steps to creating a market positioning strategy:

• Conduct market research : Start by understanding your target market and its needs. Conduct extensive research to gain insights into customer preferences, competitor offerings, and market trends.
• Define your target market segment: Clearly define the specific market segment you aim to target. Consider factors such as demographics, psychographics, and purchasing behavior to create a detailed customer profile.
• Identify unique selling points: Determine what sets your product or brand apart from competitors. Identify the unique features or solutions that resonate with your target audience.
• Define a unique value proposition: Craft a clear statement that communicates the exclusive benefits and value your product offers, setting it apart from the competition.
• Create a consistent brand image: Ensure that all marketing efforts align with the desired positioning strategy. From brand messaging and visual identity to customer interactions, consistency is key in establishing a strong market presence.

That being said, market positioning is an ongoing process that requires continuous monitoring and adaptation. As consumer preferences and market dynamics change, you need to stay agile and adjust your positioning strategy accordingly. This may involve reevaluating the target audience, refining the USP, or even repositioning the brand entirely.

Measuring the impact of your market positioning strategy

Measuring the impact of market positioning is essential to evaluate the effectiveness of your strategy and make necessary adjustments. While the specific metrics may vary depending on the nature of your business, there here are some key indicators to consider.

Market positioning is the key to global success

Market positioning is an integral component of any global expansion strategy. By effectively positioning your product or brand in different target markets, you can differentiate yourself from competitors, grow your customer base, and build long-term loyalty. 

Whether through product attributes, price, quality, usage, or competitor comparison, positioning strategies play a crucial role in shaping customer perceptions and influencing purchasing decisions.

Finally, continuously evaluating the impact of your positioning strategy and making adjustments as needed can help you stay ahead in a competitive market.

Last updated on August 4, 2023.

Stay one step ahead

Localization strategy

Video Game Localization: How to successfully expand globally

Software localization

A Guide to NestJS Localization

Translation management

Time to Rethink How Much We Depend on That “70% TM Threshold” Rule

Global business Localization strategy

Enhancing Brand Equity In New Markets: Insight from Puma, Glovo and On

Keep exploring.

How to Hyperautomate Business Growth: Five Key Strategic Insights from our Expert Panel Webinar.

Advancing Across Borders: A Strategic Roadmap for Manufacturing Businesses

• Skip to main content
• Skip to primary sidebar
• Skip to footer
• QuestionPro

• Solutions Industries Gaming Automotive Sports and events Education Government Travel & Hospitality Financial Services Healthcare Cannabis Technology Use Case NPS+ Communities Audience Contactless surveys Mobile LivePolls Member Experience GDPR Positive People Science 360 Feedback Surveys
• Resources Blog eBooks Survey Templates Case Studies Training Help center

Home Market Research

Positioning Strategy: A Complete Guide for Your Market Plan

In marketing, a positioning strategy is like a special spotlight that shows how a brand is different from its competitors. It’s all about how a brand wants people to think about it compared to other similar brands. Understanding positioning strategies can help us connect better with the people we want to reach.

In this blog, we’ll break down the main ideas behind strategic positioning and look at a complete guide on how to create effective positioning strategies.

What is positioning strategy?

A positioning strategy is like the way a brand wants to be known and remembered by its customers. It’s about telling people why a product or company is better or different from others. 

Just like when you meet new people, you want them to remember something unique about you. Companies want their customers to remember something special about their products or services.

To do this, companies think about what makes them special, who their products are for, and why people should choose them over other options. Then, they create a plan to talk about these things in a way that makes customers like and trust them. 

This helps the company stand out in a crowded marketplace and attract the right customers who will love what it offers. So, a positioning strategy is like a brand’s way of introducing itself and making a good impression on customers.

Importance of positioning strategy for your market plan

A positioning strategy is crucial for your market plan because it helps your brand stand out and make a lasting impression on customers. Here’s why it’s so important:

Differentiation

In a competitive market, customers have many choices. A well-defined positioning strategy sets your brand apart from others by highlighting its unique qualities and benefits. This differentiation helps customers understand why they should choose your product or service over others, increasing your chances of success.

Targeted marketing

Knowing your position in the market allows you to tailor your marketing efforts to a specific audience. This precision saves time and resources and ensures that your message resonates with the right people, leading to higher conversion rates.

Brand consistency

A clear positioning strategy guides your branding efforts, ensuring that all marketing materials, from advertisements to social media posts, convey a consistent and compelling message. Consistency builds trust with customers and reinforces your brand’s identity.

Long-term success

A strong positioning strategy is not just about short-term gains. It lays the foundation for long-term success by creating a customer loyalty base and establishing your brand as a leader in its category.

A well-crafted strategy is a cornerstone of any successful market plan. It sets your brand apart, helps you reach the right customers, maintains brand consistency, and ensures long-term growth and profitability.

3 keys of strategic positioning

These three keys of strategic positioning – Channel, Customer, and Competition – are essential for businesses looking to carve out a successful place in the market:

Your chosen channel is the way you communicate and interact with your customers. Whether it’s through social media, advertising, email campaigns, or other means, your channel plays a critical role in how your brand is perceived. Selecting the right channel for your target audience ensures that your message reaches the right people at the right time.

Understanding your target market and its specific needs is fundamental to developing a successful positioning strategy. When you know your customers well, you can tailor your products, services, and marketing efforts to meet their expectations. This customer-centric approach leads to increased satisfaction and loyalty.

Competition

To effectively position your brand, you must assess how it compares to your competitors in the market. Creating a positioning map helps you understand where your business stands in the minds of customers relative to other players. This insight guides your overall business strategy and helps you identify opportunities to stand out from the competition.

Types of positioning strategy

Businesses can employ several types of positioning strategies to establish a unique identity and capture the attention of their customers. Here are some common types:

Market positioning strategy

Effective market positioning strategy defines how your brand is perceived within a specific market or industry. It involves tailoring your products, services, and marketing efforts to cater to the needs, preferences, and behaviors of a particular segment of the market. 

This strategy helps your brand establish a unique identity within that market, allowing you to differentiate yourself from competitors. For example, if you’re in the smartphone industry, you might position your brand as catering specifically to tech-savvy professionals who prioritize security and productivity.

Product positioning strategy

Product positioning focuses on highlighting the distinct features, benefits, and value that your product offers in comparison to others in the market. It’s about creating a clear and compelling image of your product in the minds of consumers. 

This positioning strategy answers questions like, “Why should customers choose our product over similar options?” For instance, if you’re marketing a sports car, your product positioning might emphasize speed, performance, and cutting-edge technology.

Brand positioning strategy

Brand positioning goes beyond individual products or services; it’s about shaping the overall perception and reputation of your brand in the minds of consumers. It encompasses the emotional connection and values associated with your brand. 

Effective brand positioning creates a unique and memorable identity that fosters customer loyalty and trust. For instance, a brand like Apple is positioned as innovative, user-friendly, and design-focused, creating a strong emotional bond with its customers.

Price positioning strategy

Correct Pricing strategy is about how your product’s price is positioned relative to its quality and the perceived value it provides. It involves deciding where your product stands on the price spectrum within your market. 

You can position your product as a premium option with a higher price point, emphasizing quality and exclusivity. Alternatively, you can position it as a budget-friendly choice, highlighting affordability and value for money.

Quality positioning strategy

Quality positioning centers on highlighting your product or service’s superior quality, reliability, and performance. It aims to position your brand as a leader when it comes to quality within your industry. This strategy is often used in industries where quality is a critical factor, such as luxury cars, high-end electronics, or gourmet food products.

Competition positioning strategy

Competition positioning means showing why your brand is better than others. You talk about what makes your brand special compared to your competition. To do this, you need to know what your competitors are good at and where they’re not so good. 

Then, you focus on the things your brand does better and use that to show why customers should choose you. It’s like saying, “We’re the best because we do this really well, and they don’t.” This strategy needs you to really understand what your competitors are good and not so good at and then use that to make your brand look like the better choice.

How to create a positioning strategy: a step-by-step guide

Positioning your brand effectively in the market is essential for standing out and attracting your target audience. Here’s a step-by-step guide to help you develop a compelling positioning strategy:

Step 1: Identify your goal

Begin by clarifying your goal for creating a positioning strategy. What do you want to achieve? Your goal could be to increase market share, target a new customer segment, or rebrand your business. Having a clear objective will guide your strategy.

Step 2: Study your competitors

In-depth competitor analysis is crucial. Identify your competitors and study their positioning in the market. Understand how they communicate their unique value propositions and what sets them apart. This will help you find opportunities to differentiate your brand.

Step 3: Create a perceptual map

A perceptual map is a visual representation of how consumers perceive brands in your industry. It helps you understand where your brand stands relative to competitors in terms of key attributes or factors. Plot your brand and your competitors on the map to identify gaps and opportunities for positioning.

Step 4: Make a timeline

Develop a timeline that outlines the key milestones and deadlines for implementing your positioning strategy. This timeline should include tasks such as market research, branding updates, content creation, and promotional campaigns. A well-structured timeline keeps your strategy on track.

Step 5: Find your niche

Identify a niche or specific market segment that aligns with your brand’s strengths and unique offerings. By focusing on a niche, you can become an expert in that area and connect more deeply with your target audience.

By following these steps, you can create a positioning strategy that helps your brand stand out, resonate with your audience, and achieve your business objectives. Remember that positioning is an ongoing process that may evolve over time to adapt to changing market dynamics and customer preferences.

Strategic positioning best practice

Positioning strategy is a critical component of marketing and branding. Here are some best practices to help you develop and implement an effective strategy:

Understand your target audience

In-depth knowledge of your target audience is essential. Create detailed buyer personas to identify their needs, preferences, and pain points. Tailor your positioning to address these aspects effectively.

Analyze competitors

Conduct thorough competitor research to understand their positioning strategies. Identify gaps in the market where your brand can excel. Your positioning should aim to fill these gaps and offer something unique.

Create a unique value proposition (UVP)

Your UVP is a concise statement that communicates your brand’s unique benefits and values to customers. It should clearly articulate why your brand is the best choice. Make sure your UVP is compelling and easy to understand.

Consistency across channels

Maintain a consistent brand image and messaging across all channels, including your website, social media, advertising, and customer interactions. Consistency builds trust and reinforces your positioning in the minds of customers.

Focus on customer benefits

Instead of just listing features, emphasize the benefits your products or services offer to customers. How will using your brand improve their lives or solve their problems? Connect emotionally with your audience.

Segment your market

If your target audience is diverse, consider segmenting it into smaller, more specific groups. This allows you to tailor your positioning for each segment, making it more relevant.

Test and refine

Don’t be afraid to test different positioning strategies or messages with your audience. Conduct surveys and A/B tests and gather feedback to refine your approach based on what resonates best.

How QuestionPro help create your business positioning strategy?

QuestionPro is a versatile online survey and research platform that can be a valuable tool for creating and refining your positioning strategy. Here’s how QuestionPro can help:

Market research surveys

QuestionPro allows you to create customized surveys to gather insights from your target audience. You can use surveys to understand customer preferences, pain points, and perceptions about your brand and competitors. This data can inform your positioning strategy by clearly understanding market dynamics.

Competitive analysis

Use QuestionPro surveys to conduct competitive analysis. You can create surveys to collect feedback about your competitors from your target audience. Understand what customers like or dislike about competitors’ products or services, and identify opportunities to differentiate your brand.

Customer feedback

Positioning is all about meeting customer needs and expectations. Use QuestionPro’s feedback and satisfaction surveys to collect real-time feedback from customers. Identify areas where your brand excels and where improvements are needed. This data can guide your positioning efforts.

Segmentation

Effective positioning often involves segmenting your target audience. With QuestionPro, you can create surveys that include segmentation questions. This allows you to divide your audience into smaller groups based on demographics, behavior, or preferences. Tailor your positioning for each segment to increase relevance.

Brand perception studies

Use QuestionPro to conduct brand perception studies. Create surveys that assess how customers perceive your brand compared to competitors. Are you seen as innovative, affordable, or customer-focused? Analyzing these perceptions helps refine your positioning strategy.

A/B testing

QuestionPro offers A/B testing capabilities, allowing you to test different positioning messages or brand elements. Create surveys with variations of your positioning statement and see which resonates most with your audience. Use the data to refine your final positioning.

Employee surveys

Ensure internal alignment with your positioning strategy by surveying employees. Gather their feedback and insights to ensure everyone in your organization understands and supports the brand’s positioning. QuestionPro’s employee engagement surveys can help with this.

Data analysis and reporting

The platform provides robust data analysis and reporting features. Visualize survey results with charts and graphs to gain actionable insights. Use this data to make informed decisions and adjustments to your positioning strategy.

Integration

QuestionPro integrates with other business tools and platforms, making it easier to incorporate survey data into your overall marketing and strategic planning. Integration with customer relationship management (CRM) systems can be particularly valuable.

Survey templates

QuestionPro offers a library of survey templates for market research, customer feedback, and brand perception. These templates can save you time when creating surveys for positioning research.

Real-time analytics

Get real-time access to survey responses and analytics. This allows you to stay agile and make adjustments to your positioning strategy as needed based on the incoming data.

QuestionPro is a versatile platform that can facilitate every step of the positioning strategy process, from gathering initial market insights to testing and refining your brand’s positioning. Its survey and research capabilities empower businesses to make data-driven decisions that strengthen their market position. Contact QuestionPro today for a free trial or learn more!

LEARN MORE         FREE TRIAL

MORE LIKE THIS

Exploring Types of Correlation for Patterns and Relationship 

Jun 10, 2024

Life@QuestionPro: The Journey of Kristie Lawrence

Jun 7, 2024

How Can I Help You? — Tuesday CX Thoughts

Jun 5, 2024

Why Multilingual 360 Feedback Surveys Provide Better Insights

Jun 3, 2024

Other categories

• Academic Research
• Artificial Intelligence
• Assessments
• Brand Awareness
• Case Studies
• Communities
• Consumer Insights
• Customer effort score
• Customer Engagement
• Customer Experience
• Customer Loyalty
• Customer Research
• Customer Satisfaction
• Employee Benefits
• Employee Engagement
• Employee Retention
• Friday Five
• General Data Protection Regulation
• Insights Hub
• Life@QuestionPro
• Market Research
• Mobile diaries
• Mobile Surveys
• New Features
• Online Communities
• Question Types
• Questionnaire
• QuestionPro Products
• Release Notes
• Research Tools and Apps
• Revenue at Risk
• Survey Templates
• Training Tips
• Uncategorized
• Video Learning Series
• What’s Coming Up
• Workforce Intelligence

How to Build a Positioning Strategy for Your Brand

What words come to mind when you think of iconic brands like Uber and Instagram? Maybe you think of “fast” and “affordable” for Uber, or “share” and “friends” for Instagram.

The associations we have with brands may seem benign, but they are vital for brands to succeed in the long term.

What a customer associates your brand with influences how they interact with your company. If the association is positive, they may make repeat purchases or recommend you to a friend. If the association is negative, they may avoid your brand or opt for a competitor.

To control how consumers view your brand , you need to position your company correctly.

Naturally, it would help if you had a strong positioning strategy to build loyal customers long-term. This article will teach you what a positioning strategy is and how to create one.

Let’s dive in.

What Is a Brand Positioning Strategy?

A positioning strategy helps you outline how you want customers to perceive your brand. Essentially, it outlines the “thing” your brand is known for.

Though we often associate brand positioning with marketing, your positioning strategy influences many aspects of your business. This includes sales, customer service, customer relations, and order fulfillment.

There are many advantages to developing a positioning strategy, as it can help you:

• Shape your customer experience
• Make sure the content you produce aligns with your brand’s visions and goals
• Build brand recognition
• Design a high-quality marketing strategy
• Market your brand
• Craft a recognizable public presence
• Create a niche for your brand
• Showcase your competitive advantage

Like anything branding-related, these advantages only apply when the positioning strategy is effective. Effective strategies generally consider customers’ desires and needs carefully. Additionally, they account for the brands’ strengths and weaknesses and outline their competitive differentiation.

Many brands share their positioning strategy through a 10–50 word positioning statement. These are like a mission statement, except a mission statement answers the question, “Who are we?” While a positioning statement answers the question, “What do we do?”

We will dive deeper into developing a positioning statement in the “How To Design a Positioning Strategy”  section.

Positioning Strategy Examples

While we don’t know precisely how each brand positions itself internally, you can see most brands’ strategies from their marketing.

To conceptualize how a positioning strategy looks, let’s analyze five branding examples from well-known brands.

1. AirHouse

AirHouse is a logistics platform that helps people organize and manage product shipping.

If you look at AirHouse’s homepage, you can see that the brand positions itself to cater to retail and ecommerce businesses that ship products to customers.

The marketing on this page also tells us that:

• AirHouse prides itself on providing a fast and easy experience
• AirHouse can help brands increase order fulfillment scale
• AirHouse’s “thing” is providing a cloud-based solution that syncs your fulfillment data in real-time

Slack is a professional communication and chat tool designed for teams. Looking at Slack’s homepage, you’ll see that Slack positions itself as a “digital HQ” for companies.

Additionally, Slack markets itself as:

• A trusted brand, as the homepage mentions that Fox, Lonely Planet, Intuit, Carvana, Kiva, Target, and DevaCurl use Slack
• A tool for the future, as Slack uses phrases like “build a better tomorrow” to describe what you can do with Slack
• A tool that’s compatible with Google, as Slack prompts visitors to “sign up with Google”

3. RingCentral

RingCentral is a cloud communications company that offers voice, text, fax, and conferencing solutions for small, medium, and large businesses.

If you look at RingCentral’s homepage, you can see that the company positions itself as an all-in-one provider that prioritizes getting customers “connected.”

Scrolling down on RingCentral’s homepage also shows that the company sets itself apart from competitors by offering 24-hour support with “fast resolution,” professional services with “quicker ROI,” integrated solutions for “accelerated business growth,” and real-time analytics that provide “business-driving insights.”

Owned by PayPal, Honey is a browser extension that collects discount coupons for popular websites and automatically applies them to users’ transactions.

Honey’s marketing is built on social proof that the extension is trustworthy. This proof includes the statements that Honey works on “30,000+ sites,” has “167,000 Chrome Store reviews,” and serves “17 million members and counting.”

If you look at Honey’s Facebook page, you can also see that Honey positions itself like a friend to customers with language like “shop smarter, together” and “join Honey.” Honey’s customer service email, “ [email protected] ,” also uses this positioning.

5. Function of Beauty

Function of Beauty produces beauty, skin, and hair care products personalized to each customer’s tastes.

If you look at Function of Beauty’s website, you’ll see that the brand positions itself as “the world leader in customizable beauty.” This positioning is clever because it provides social proof while emphasizing that the Function of Beauty is different because it allows for custom products.

Positioning Perceptual Map

After looking at marketing from RingCentral and Function of Beauty, you may have noticed that competitors play a vital role in a good positioning strategy. An effective positioning strategy describes why your brand is unique, thus separating you from your competitors.

Of course, it’s not always easy to see how your brand is unique when designing your positioning strategy.

That’s where a positioning perceptual map comes in.

A positioning perceptual map (also known as a “brand map” or “magic quadrant”) is a visual representation of how your brand compares to your competitors using two or more factors at a time. When marketers create perceptual maps, they think from the target customers’ perspective.

Here’s what a perceptual map looks like:

Though you can use any factors you like in your map, here are some common factors many brands utilize:

• Time investment
• Ease of use
• Product quality
• Customer service
• Trustworthiness
• Supply chain ethics
• Profitability

Although many brands use perceptual maps as an internal tool to guide operational and marketing decisions, some brands also choose to share their perceptual maps as a marketing tool. For example, RingCentral published this perceptual map on its website:

Types of Positioning Strategies

Up until this point, we’ve covered positioning strategies as a whole. However, there are seven different “types” of positioning strategies, each of which uses a unique angle.

These strategies are:

1. Pricing-Based Strategies

Pricing-based strategies position your brand as desirable because of the cost, pricing model, or value for money you provide.

For example, a brand using a pricing-based strategy may describe itself as “affordable for families” or “a retailer with low prices.”

However, pricing-based strategies don’t always play the race to the bottom , as high-class brands like Mouawad (which sells a $3.8 million  handbag) also use a pricing-based strategy to market products as luxurious.

Alternatively, brands like Netflix and Hulu use their subscription-based pricing model in their positioning, as subscription-based pricing allows consumers the flexibility to watch a vast catalog of content, not just rent a single movie or show at a time.

2. Product-Based Strategies

Product-based strategies build your brand positioning around the quality of your products and services. For example, a product positioning strategy might emphasize that a product is durable, dependable, reliable, stylish, environmentally friendly, cruelty-free, kosher, or vegan.

Alternatively, a product-based strategy might market your brand with key features or benefits . Grammarly does this, as it built its brand positioning around offering a program that gives people “real-time suggestions to strengthen their writing.”

3. Use-Based Strategies

Use-based strategies position your brand by what your product or service does for customers.

For example, legal service Lawyer.com positions itself as an intermediary between people and lawyers in their area with branding like “get connected with a lawyer today.” Or, the real estate website Zumper promises to help users “find your fresh start.”

4. Situation-Based Strategies

Situation-based strategies position your brand as the perfect solution in a niche situation. Essentially, these strategies say, “(brand) is perfect for (niche users) who need (result).”

Brands that produce niche products like laptop skins or phone cases use situation-based strategies, as their products only work for specific devices.

Well-known brands also use this positioning. For example, Tylenol positions its flagship Tylenol product with a situation-based strategy. The company specifically designed the medication for people who want over-the-counter pain relief from acetaminophen.

5. Influencer-Based Strategies

Influencer-based strategies position brands as the company chosen by a famous person, an influencer, or a well-established industry figure.

One of the most well-known examples of a business that uses a famous person for positioning is Raycon. Raycon is a wireless headphone company founded by musician Ray J.

Businesses owned by influencers also use this type of positioning. Examples include Cloud9 Scrubs and HudaBeauty.

6. Symbol-Based Strategies

Symbol-based strategies use popular or culturally significant symbols to position a brand as aligned with the meaning behind the symbol.

For example, brands like Qatar Airways convey a sense of royalty by using shades of purple and red associated with wealth, luxury, and notability.

Brands that market themselves based on awards or industry recognition also use a symbol-based positioning strategy. Like symbols, these awards associate the brand with the award’s prestige.

7. Competitor-Based Strategies

Competitor-based strategies position brands as an alternative to a famous brand. These strategies often use phrasing like “the free alternative to (famous brand)” or the “eco-friendly version of (famous brand)” to emphasize why they are the better choice.

You can see an example of competitor-based positioning in Rocket.Chat . Rocket.Chat markets itself as a communication platform alternative using language like “Rocket.Chat does everything other platforms do, except exposing your data.”

Search engine DuckDuckGo uses similar positioning for marketing itself as an alternative to Yahoo, Google, and Bing. DuckDuckGo’s slogan is “your personal data is nobody’s business.”

Creating an Effective Positioning Strategy

Creating a solid positioning strategy is vital in setting your brand up for success and leading to high conversions .

For example, consider the positioning of the Tato Nano car — a car that Tato only marketed as low-cost. The Nano cost roughly $2,500 USD (though Tato sold it primarily in India).

The car itself wasn’t a horrible product, but marketing it as “cheap” caused people to consider it a low-quality investment for people who couldn’t afford a different vehicle. As a result, Tato only sold 7,591  Nanos during 2016 and 2017, and the project failed to make a significant return on investment  for Tato.

To help you design a positioning strategy that serves you better, we’ll cover the critical components of a positioning strategy and how to create one in this section.

Key Components of Positioning Strategy Marketing

Three key components underpin every positioning strategy. These are sometimes called the “three Cs” of branding and positioning.

If you recognize the “three Cs” phrase, it’s because a popular theory developed by Kenichi Ohmae shares the same name. Ohmae’s model outlines that a company is successful because of its customers, company, and competitors.

The three Cs for positioning strategies are similar, as they include:

The “customer” component covers the customer’s needs, wants, and desires. As these factors motivate a customer in every interaction with your company, including them in your positioning will help you serve them better.

When thinking about your customers regarding positioning, it’s helpful to ask yourself questions like:

• What motivates your customers?
• What separates loyal customers from past customers?
• What inspires a customer to make a repeat purchase?
• What do customers like about (brand)?
• What do customers want to change about (brand)?
• What broad consumer perceptions exist about (brand)?

The “channels” component covers the operational, sales, and marketing channels that customers use to reach your brand. These channels include your sales team, content marketing, social media profiles, advertising, customer service representatives, email marketing , and other forms of digital marketing .

It’s essential to consider how your channels look to customers because they shape customers’ interactions (and thus, the impression they develop of your brand).

Competition

The “competition” component refers to how your brand compares to other brands within your niche and industry.

When comparing your brand to your competition, it’s helpful to ask questions like:

• What does (brand) do that no one else does?
• What are (competitor) ‘s weaknesses and strengths?
• How does (brand) compare in supply chain ethics, sustainability, and diversity and inclusion?
• How do (brand) ‘s products and services compare to similar offerings?

Positional maps are crucial for understanding where you stand compared to your competition.

How to Design a Positioning Strategy

Follow these steps to design your positioning strategy.

Step 1. Define Your Target Audience

Your company couldn’t exist without customers. Naturally, identifying your target audience is the first step you need to craft your positioning strategy.

The easiest way to pinpoint your target market is to describe your buyers by their demographics, buying behavior, and tastes. You might want to present this information in a buyer persona. A buyer persona is a representation of your target market that looks like this:

You should also identify what a marketing qualified lead (MQL) and sales qualified lead (SQL) looks like for your brand during this stage. MQLs have the need and desire for your goods but aren’t ready to purchase like SQLs are.

Separating your MQLs from your SQLs will help you position your brand to target leads at the right time.

Step 2. Research Your Competitors

Next, you’ll need to research your competitors thoroughly to identify their positioning strategy. Identifying competitors’ strategies will help you determine what makes your brand different.

You might want to use a SWOT and PESTEL analysis to make this market research easier.

A SWOT analysis looks at a company’s strengths, weaknesses, opportunities, and threats. Here’s a SWOT analysis template you can use:

A PESTEL analysis (sometimes called the “external factors analysis”) focuses on the environment around a company. It looks at Political, Economic, Social, Technological, Environmental, and Legal factors like these:

Step 3. Brainstorm

Once you understand your audience and competitors, start brainstorming potential positioning strategies your brand could use. It might be helpful to refer to these strategies from the “Types of Positioning Strategies”  section for inspiration:

• Pricing-based strategy
• Product benefit-based strategy
• Use-based strategy
• Situation-based strategy
• Influencer-based strategy
• Symbol-based strategy
• Competitor-based strategy

You could also try brainstorming techniques like word association, mind mapping, or thinking like a customer. Alternatively, you could read customer feedback and look for common keywords (like “good customer service” or “eco-friendly”).

Whichever brainstorming method you choose, include your sales, marketing, and management teams in the discussion. Each group sees customers differently, so they will bring different ideas to the table.

Step 4. Narrow Down Your Options

Once you’ve created a list of options, you can sort them in two primary ways:

• Eliminate the ideas that don’t align with your brand values or goals
• Highlight the strongest ideas

It may also help to combine similar ideas.

This step will leave you with a small handful of potential positioning or repositioning strategies. Consult your colleagues to find the right one.

Step 5. Write Your Positioning Statement

Writing a positioning statement will give you an accurate reference point to revisit. It will also help you clearly define your positioning strategy in a way that’s easy for you and your colleagues to convey to others.

While every positioning statement is subjective, there are four things you should include: your target audience, what you do (or what your product or service is), how you are different, and what “end goal” you help customers reach.

If you are stuck, try these templates:

• “(brand) uses (the thing that makes you different) to help (target audience) to (end goal).”
• “(target audience) turns to (brand) for (the thing that makes you different) when they want (end goal).”

Alternatively, you could draw inspiration from an existing brand. For example, PayHlip’s shortened position statement is, “ We help creators earn a living online doing what they love .” The more extended version reads:

“Payhip is an e-commerce platform that enables anyone to sell digital products or memberships directly to their fans and followers. You can embed Payhip directly into your website or use our storefront to sell your work. Payhip takes care of everything. We’re an all-in-one ecommerce solution for creators.”

When writing your statement, keep these tips in mind:

• Align your message with your brand values
• Keep the statement concise
• Back your statement up with data and key performance indicators (KPIs)

And that’s it! You now have a positioning strategy to apply to your operations and marketing .

Final Questions For Effective Positioning Strategies

Before we wrap this article up, we wanted to touch on the three questions that underpin most positioning strategies. These questions include:

• “What is (brand)?”
• “Why should you buy from (brand)?”
• “Why shouldn’t you buy from (brand) ‘s competitor?”

Though it’s easy to get caught up in the flowery language of a well-written positioning statement, how effectively you answer these simple questions determines whether your strategy works or not.

Similarly, it’s easy to turn your positioning statement into a unique selling proposition (USP). A USP describes why prospective customers choose your product or service over a competitor. USPs focus on products and services, while positioning statements focus on brands.

For example, McDonald’s market positioning strategy is that it is a family-friendly fast food restaurant, while the USP of a Happy Meal is an affordable child’s meal that comes with a toy.

Revisit the three questions to stop your positioning statement from turning into a USP.

Developing a successful positioning strategy is vital to compete in 2024, as good strategic positioning will help you:

• Set your brand apart from competitors
• Create strong marketing messages
• Align your brand values with your marketing plans
• Build an effective business strategy

Building a solid positioning strategy may seem complicated, but it’s easier than you think. Remember to focus your statement on customers, stick to your values, and take a research-based approach.

Now that we’ve covered positioning strategies in detail, we’d like to hear from you. How did you design your positioning strategy, and do you have any tips for writing a solid positioning statement? Share them in the comments below.

Content & Marketing Editor at Kinsta, WordPress Web Developer, and Content Writer. Outside of all things WordPress, I enjoy the beach, golf, and movies. I also have tall people problems ;).

Related Articles and Topics

Powerful Managed WordPress Hosting

20+ Must-Know Email Marketing Statistics (Use Data to Boost Your Email Campaigns)

• Digital Marketing
• Local Development

Leave a Reply Cancel reply

By submitting this form: You agree to the processing of the submitted personal data in accordance with Kinsta's Privacy Policy , including the transfer of data to the United States.

You also agree to receive information from Kinsta related to our services, events, and promotions. You may unsubscribe at any time by following the instructions in the communications received.

What Is Positioning in a Marketing Plan?

• Small Business
• Advertising & Marketing
• Marketing Plans
• ')" data-event="social share" data-info="Pinterest" aria-label="Share on Pinterest">
• ')" data-event="social share" data-info="Reddit" aria-label="Share on Reddit">
• ')" data-event="social share" data-info="Flipboard" aria-label="Share on Flipboard">

Pricing Strategy Methods to Influence Competitive Behavior

Sales & marketing promotion strategy, ad position strategies.

• Transference Marketing Techniques
• Marketing Concepts & Strategies

Positioning is a marketing concept that outlines what a business should do to market its product or service to its customers. In positioning, the marketing department creates an image for the product based on its intended audience. This is created through the use of promotion, price, place and product.

The more intense a positioning strategy, typically the more effective the marketing strategy is for a company. A good positioning strategy elevates the marketing efforts and helps a buyer move from knowledge of a product or service to its purchase.

Target Market Analysis

The best start for any positioning analysis is gaining a thorough knowledge of a product or service's target market. This is the group of people or businesses that will best benefit from the use of the product or service. With a good idea of the wants, needs and interests of a product or service's target market, a good marketing team can help develop a positioning statement to help reach as much of the target market as possible.

Positioning in Advertisements

Advertisements are usually the first places businesses position themselves. A cosmetics marketing department, for example, must determine who they are targeting and what consumer need is being met. If the intended target is African American teenagers, what type of need should the cosmetics fill?

If the cosmetics line is trying to help teenage girls overcome acne issues, the person in the ad might be one of a younger African American physician who teaches girls how to battle acne with the use of these cosmetics. To note the importance of positioning, this same type of advertisement might not work if the intended audience of the cosmetics line was older Caucasian women trying to look younger.

Positioning in Sales Locations

Reaching the customer is not simply a matter of advertising, it is also a matter of choosing the right channels for distribution. If a majority of your target market lives in an urban area with only public transportation available to them, having your product in rural areas where a private automobile is needed for transport would not equal sales success. Place or position your product or service as close to the target market as possible. Create similar advertisements in store as the ones seen out of store to create an overall identity for your brand.

Positioning through Price

It should be noted that there is a large amount of research on the psychology of pricing in marketing. Simply put, the price of an item tells the buyer more about the item than most realize. Many associate a higher price with higher quality and the opposite with a lower price. Additionally, if a product is positioned as a good alternative to high-priced brands, the marketing department must price it in the middle of the market to avoid a comparison to the cheapest end of the spectrum.

• Innis Maggiore: How to Develop an Effective Positioning Strategy
• Enterpreneur: Positioning
• USC: Segmentation, Targeting, and Positioning

Lynn Lauren has been a professional writer since 1999, focusing on the areas of weddings, professional profiles and the banking industry. She has been published in several local magazines including "Elegant Island Weddings." Lauren has a Master of Business Administration and a Bachelor of Business Administration, both with marketing concentrations from Georgia Southern University and Mercer University, respectively.

Related Articles

Why is a target market analysis important, how to brand your product, how to study the importance of a marketing mix, marketing strategies for kids' shoes, the importance of market orientation for emerging firms, how to write a marketing profile, advertising theories of cosmetics, differences between product differentiation & market segmentation, what is stereotype marketing, most popular.

• 1 Why Is a Target Market Analysis Important?
• 2 How to Brand Your Product
• 3 How to Study the Importance of a Marketing Mix
• 4 Marketing Strategies for Kids' Shoes

16 Examples of Positioning Statements & How to Craft Your Own

Published: June 05, 2024

Picture this: You launch a new product after you’ve spent countless hours, weeks, months, or even years determining what sets it apart from the competition and building a brand identity.

Sadly, it falls flat because you don’t have a positioning statement to guide your sales reps, marketers, and service and support teams to prove your value to your target audience.

Whether this has happened to you or not, I’m here to help. In this post, I’ll explain what a positioning statement is, outline exactly how to write a positioning statement (with advice from experts), and go over some real-life positioning statement examples to inspire you.

Table of Contents

What is a positioning statement?

What is the purpose of a positioning statement.

• Positioning Statement vs Mission Statement

Value Proposition vs. Positioning Statement

The core elements of strategic market positioning, how to write a positioning statement, positioning statement examples.

A positioning statement is a brief description of a product or service and an explanation of how it fulfills a particular need of the target market. The goal of a positioning statement is to align marketing efforts with a company's brand and value proposition.

A positioning statement is an internal tools that help marketers appeal to their buyer personas in a relevant way. They're a must-have for any positioning strategy because they create a clear vision for your brand .

Having a clear and concise positioning statement is important because it gives potential consumers the ability to understand your business at first glance. Buyers want to know how your product and purpose differentiate you from the rest of the market, without buying the product first.

Here’s what Mike Sadowski , Founder and CEO of Brand24 , told me when I asked him about positioning statements: “I once asked myself, ‘What is the real purpose of a positioning statement?’ My answer: to communicate to people for whom I create my brand that it's tailored perfectly for them, addressing all levels of their needs...I view the positioning statement as a message that convinces people that our brand and product are precisely what they desire.”

10 Positioning Statement Templates

Everything you need to create a stand-out positioning statement.

• Defining a positioning statement
• 6 tips for writing a positioning statement
• 10 industry specific positioning statement templates

Download Free

All fields are required.

You're all set!

Click this link to access this resource at any time.

The purpose of a positioning statement is to convey a brand's value proposition to its ideal customers. It also frames the brand's identity, goals, and distinguishing features within the context of the buyer’s experience.

To craft your positioning statement, you'll need to get clear on a few key facets of your business:

• Who you serve
• What value you offer
• How you position your offer
• Why you're in business
• What makes you different from the competition

Next, I'll talk about how a positioning statement differs from some other common guiding principles in a business marketing strategy.

Fill out the form to access free positioning statement templates.

Positioning statement vs. mission statement.

A mission statement is the purpose your business serves in the market — it's an inherent part of the organization that guides every business function. When considering the “what, why, and how” of your business, a mission statement answers the question “why” while the positioning statement answers the “what.”

(If you’re curious about what the "how" looks like, here it is .)

Unlike a mission statement , your positioning statement isn't public-facing. You don’t want to give away any competitive intelligence to your competitors, so it’s used as a source of truth to guide other processes, like the messaging for your marketing campaigns or the talking points salespeople use during 1:1 conversations.

At its core, your business’s positioning statement summarizes the value that your brand, products, and services bring to the target market.

The value proposition and positioning statement are both key elements in a business' marketing strategy, however, there are differences between these two. A value proposition describes what sets your product or service apart from competitors. It gives an overview of the benefits a product or service offers.

A positioning statement is broader and it’s created after you've developed your business' value proposition. It also identifies the primary customer benefits — why someone needs your product or service.

Now that you understand the differences among some common business and marketing elements, here are the core elements of strategic marketing positioning that you'll need to know.

As I mentioned earlier, crafting your positioning statement starts with a good understanding of your company. This includes defining the following core elements:

• Target market
• Market category
• Customer pains
• Brand promise
• Brand identity and values

Target Audience

Your target audience is the "who" aspect of your positioning. Simply defined, it's the group of consumers you're targeting with your product or services.

They say that "the riches are in the niches." To me this means that, even if anyone can use your product or service, you should still be targeting specific buyers to maintain integrity and differentiation within your brand.

In my opinion, the best and most foolproof way to define a solid target audience is to create a buyer persona (a representation of your ideal customer).

Product Positioning

Product positioning should lead with the product's benefits rather than its features . A smart way to do this is to imagine your customer’s life before and after using your solution. Then, tell the story of what happens to them when they make that decision. That’s the benefit you’ll include in your product positioning.

Market Category

A market includes buyers and sellers. A category defines a specific segment of that market. Market categories can be as broad as "grocery store" and as niche as "vegetarian health food store." Market categories usually start out broad and get more niche as the businesses occupying that market expand their product and service offerings to the consumers in the market.

Whether your market category is developed or you're part of an emerging or niche market, I recommend defining who all potential buyers are, where they search for goods and services, and who has their attention. You'll want to define what your competition offers and how you can position your brand apart from those competitors .

Customer Pains

Customer pains are the problems or issues your target audience is experiencing that could be solved with products or services available in your market category. Your product or service should aim to address customer pains and offer a solution.

Brand Promise

Your brand promise is ultimately what the target audience or buyer persona stands to gain from using your product or service. It's what success looks like to them if their pain or problem is resolved.

Brand Identity

Brand identity is the personality of your business and includes both visible factors (such as logo design) and invisible ones (such as values or voice). Brand identity is one aspect of strategic market positioning that will set you apart from competitors and help you gain recognition from your target audience.

Values guide how your business makes decisions within the context of your brand. They create the culture of your organization and leave a favorable impression on your target audience. They are the intangible methods with which you execute your mission and vision.

Featured Resource : 50 Examples of Company Values

Once you have a solid understanding of these core elements, you can begin crafting the positioning statement.

My Pro Tip: I recommend developing your business’ value proposition before writing your positioning statement. When you know the unique value you bring, it’s much easier to craft a statement that speaks directly to your target audience and describes how your product or service is the best solution for their pain points.

• Create a vision board.
• Keep it brief.
• Make the statement unique and memorable.
• Remain true to your business’s core values.
• Include what the brand delivers to consumers.
• Differentiate your business from the competition.
• Keep it simple.
• Consult a colleague.

When writing and evaluating your positioning statement, keep the following tips in mind:

1. Create a vision board.

Positioning statements are written documents. Since they don’t include images, video, or other visuals, it can be challenging to communicate what your business is, who it serves, and why that matters in just a few sentences.

To bypass the initial blank page syndrome , create a vision board instead. A Columbia University study found that visual characteristics can trigger emotional responses , which can help you understand your target audience and what speaks to them.

To leverage this response, look for images that represent your customer in the environment where they need your product or service the most. Notice the emotions in the images, who is around your ideal customer in the image, and what they’re doing in the image to solve the problem.

Image Source

Creating a vision board that represents your target audience when they need your product the most can help make your positioning statement come to life.

2. Make it brief.

You have a short time to capture attention, so a brief positioning statement is much more likely to be read than a longer one.

Your brand’s positioning statement should be concise and to the point. Aim for no more than three to five sentences, if possible.

The wordier that your statement gets, the less factual it becomes. It then risks becoming more aspirational instead of what your business is, with more elements that are more inflated than grounded in truth.

Pro Tip: Fluff and unnecessary details are your worst enemy when it comes to being brief. Stay focused on the value your product or service provides, and get rid of anything else that distracts from that.

Heather Johnson , MedTech Marketing Consultant and President at OutWord Bound Communications , shared her advice with me, and it’s a great exercise for keeping it brief: “Keep asking “so what” until you get to the root of those answers. For example, a small business wants to acquire and retain more customers without spending tons of time fiddling with technology; your XYZ platform makes it happen by…”

3. Make it unique and memorable.

This statement should be unique to your company and the problems you aim to solve. When crafting your positioning statement, be sure to emphasize the distinctive qualities of your brand.

Buyers should be able to see the special value that your business can offer or solve for. Many markets are already saturated with products or services that are similar to your offering, so your statement should be able to capture their attention against the noise.

Pro Tip: I think Shelley Grieshop , Creative Writer at Totally Promotional , tip about exploiting personal history is a great way to make your positioning statement unique and memorable.

She said, “Select one thing your company does or offers that is uniquely related to your personal history and demographics. Exploit that tidbit in your marketing strategy and all communications to show your individuality and establish brand recognition. The bottom line: Your story is your value.”

4. Remain true to your business’s core values.

The positioning statement isn’t the time to get fancy and pitch a new angle for the business. Your brand’s positioning statement should accurately reflect the core values of your business.

Clear core values in your positioning statement also send messages to your internal team. They help new employees with better alignment. Besides letting consumers know your stances, core values help existing team members stay on the right track and continue to deliver on your brand’s promises.

Pro Tip: Clarity and authenticity are William Hogsett ’s, CEO of Seota Digital Marketing , best practices for high-quality positioning statements. He says authenticity builds trust and credibility, so your positioning statement should be authentic and reflect your brand’s core values and strengths.

He said: “Incorporate elements of your brand’s story, mission, and personality into the statement to create a compelling narrative that resonates with your audience on an emotional level.”

5. Include what the brand delivers to consumers.

Your brand offering is a vital part of your positioning statement. It’s the main reason that customers are seeking you out, so when crafting your own, you need to cover these two bases:

• Who does your company serve?
• How does your company serve this group?

Succinctly state who your customer is and how you will help them in your positioning statement.

Pro Tip: Sai Sathish , B2B Marketing Leader and Founder at ConsaInsights , told me that considering your audience’s perspective is crucial. He says it’s easy to get carried away with what you think the best thing is about your brand when it should really be about what the best thing is for your audience.

He said: “I have had many instances where I thought my positioning statement was the most revolutionary one and would impress people in one go, but they failed miserably. So don’t brainstorm on how to highlight your company’s great aspects — simply back-calculate. Understand what they would like to hear and find that about your company and present it to them.”

6. Differentiate your business from the competition.

An effective positioning statement should articulate what differentiates a brand from its competition. Highlight your company’s unique qualities and how those qualities help serve your customers. You can even consider a niche marketing strategy .

Does your brand have cause-related campaigns? Differentiate your brand by highlighting your goals to give back.

Does your brand serve a previously underrepresented target audience? Let them know clearly and proudly that you fill that gap. If you’re not sure how to separate your product offer from your competitors, these competitive analysis templates can help you out.

There are so many different ways to stand out against the crowd, you just have to survey your competitors and see how you do it better .

Pro Tip : Bhavik Sarkhedi , CMO of Write Right , says that “[When creating a positioning statement] It’s crucial to articulate not only what your brand offers, but also how it differs from the competition.”

He adds, “Ask yourself: What can we offer that no one else can? Why should the customer choose us over others? This focused approach ensures that your brand’s message is clear and compelling, making it easier for customers to see the value in choosing your brand.”

7. Keep it simple.

In almost any circumstance, your team should be able to align key business decisions with your brand’s positioning statement because its simple and easy-to-understand nature .

The more complicated your statement becomes, the less convincing or engaging it will be. Make sure your business’ value and offering is unmistakable and buyers will understand and seek to learn more about it in their buyer’s journey.

8. Consult a colleague.

Just because positioning statements aren’t public-facing doesn’t mean they shouldn’t be easy to understand. Investors, new hires, and external agencies who work closely with your businesses will need to use this document, too.

After spending several hours perfecting every word, you might think what you’ve written is wonderful (and I’m not saying it isn’t) when it’s actually filled with jargon, acronyms, and features that aren’t clear to someone outside your company.

When you’re in your final stages, reach out to a colleague. Someone not directly involved with the writing process can give you a fresh and objective perspective to help identify any issues you’ve overlooked. A third party might even have an easier time placing themselves in your audience’s shoes.

My Pro Tip: You want helpful and actionable feedback, so I recommend telling your colleagues exactly what you’re looking for. For example, you could ask them to read for:

• Clarity - Does your positioning statement clearly communicate value?
• Consistency - Does your positioning statement align with your known brand image and values?
• Relevance - Is your positioning statement relevant to your target audience’s pain points?
• Impact - Does your positioning statement leave the reader interested in learning more?

Positioning Statement Template

For [your target market] who [target market need], [your brand name] provides [main benefit that differentiates your offering from competitors] because [reason why target market should believe your differentiation statement.]

You can use the template above to form a positioning statement for your startup or small business . Add the details of your target market, company, and the main points that make your product or service stand out from competitors. You can also download 10 more position statement templates for free below.

Download Now: 10 Free Positioning Statement Prompts

Each business is unique, and it's alright if your statement doesn't fit the template exactly, but I suggest including the main points below:

• A description of the target market.
• A description of the target market needs.
• How your business will meet their needs.
• What differentiates your product or service from the competition.
• Why consumers in your target market should believe your brand's claims.

You might need a little more inspiration before taking pen to paper and creating your own positioning statement. Here are some examples to get your creative juices flowing.

I mentioned above that your positioning statement is a crucial part of your business and a guiding source of truth. So, for the most part, it’s away from the public eye and you’ll rarely find a business’ exact positioning statement floating around on the internet.

Because of that, I’ve used our positioning statement template to craft a few example statements for recognizable brands using the information we know about them.

Below are examples of positioning statements of well-known brands to give you a feel for how to create one for your business.

HubSpot Positioning Statement:

"Since 2006, HubSpot has been on a mission to make the world more inbound. Today, over 100,000 customers in more than 120 countries use HubSpot's award-winning software, services, and support to transform the way they attract, engage, and delight customers. Composed of HubSpot's CRM, Marketing Hub, Sales Hub, Service Hub, CMS Hub, and Operations Hub, HubSpot gives companies the tools they need to grow better."

Why I Like This Positioning Statement:

It starts with a clearly defined mission and track record to capture the attention of prospects. Then, HubSpot’s positioning statement notes its trustworthiness and variety of products to better service businesses looking to grow and scale for the future.

• Connects with the target audience by showing global businesses its breadth of scalable solutions.
• Sells its product(s) in a unique wa y by showcasing that these products are made to scale.
• Highlights core values by emphasizing its focus on customer success and innovation.
• Offers a clear and focused message by leaning into its value proposition and services.

2. Coca-Cola

Coca-Cola Positioning Statement:

"For quality beverage seekers, Coca-Cola offers a wide range of the most refreshing options. Each creates a great experience for customers when they enjoy a Coca-Cola brand drink. Unlike other beverage options, Coca-Cola products inspire happiness and make a positive difference in customers' lives, and the brand is intensely focused on the needs of consumers and customers."

While its product offering is beverages, Coca-Cola leads its positioning statement with the positive experience it wants to offer. It appeals to emotions and tells us consumers that we’re buying from a company that wants to better our lives — even with something as simple as a cold drink. It:

• Connects with the target audience by focusing on beverage consumers looking for quality and satisfaction.
• Sells its product(s) in a unique way by focusing on positive impact and using phrases like "inspire happiness" and "make a positive difference."
• Highlights core values with a focus on quality products and customer experience.
• Offers a clear and focused message that is easy to understand and highlights benefits without feeling salesy.

3. White Dog Distilling

White Dog Distilling Positioning Statement:

"Founded in 2016 by the husband/wife team of Carlo and Alecia Catucci, White Dog Distilling stands for passion, spirit, and the journey from grain to glass. Bolstered by Carlo's background in physics and Alecia's culinary and product development experience, they set forth with one goal in mind: to produce high-quality distilled spirits that could appeal to both novice spirit drinkers and longtime aficionados alike."

White Dog leads its positioning statement with the quality it delivers to customers. Offering locally sourced and sustainable ingredients attracts customers looking for good value versus price, with delicious taste. I think the statement also makes the brand accessible to those who aren’t well-versed in spirits.

• Connects with the target audience by using the founders' story to connect with both novice and expert customers.
• Sells its product(s) in a unique way by focusing on quality, craft, and innovation.
• Highlights core values by showing how and why it's committed to using quality materials and processes.
• Offers a clear and focused message by using the value proposition as the center, then highlighting how the founders create that value.

4. Alaska Airlines

Alaska Airlines Positioning Statement:

"We are creating an airline people love. Each day, we're guided by our core values of own safety , do the right thing , be kindhearted , deliver performance , and be remarkable at work and in our communities. Alaska Airlines also fosters a diverse and inclusive culture and is an Equal Opportunity Employer."

Alaska Airlines leads its positioning statement with love and heart. It introduces prospects to the brand feeling as though they’re more than typical transactions. Instead, it focuses on each customer as a unique individual who's worth delivering great service and inclusive experiences to.

• Connects with the target audience with values that emphasize community, diversity, and inclusivity.
• Sells its product(s) in a unique way by putting customers and their experience in the spotlight.
• Highlights core values that matter to customers, like safety, ethics, kindness, and reliability.
• Offers a clear and focused message by reinforcing its brand identity instead of creating a new set of benchmarks or expectations in the positioning statement.

5. Organic Bath Co.

Organic Bath Co. Positioning Statement:

"If you're seeking clean and healthy ingredients in your body care routine, Organic Bath Co. offers a line of organic and natural skincare products that you can feel good about using. Trust in Organic Bath Co. for clean uncomplicated ingredients that will leave you feeling rejuvenated and cared for."

I found that Organic Bath Co.’s positioning statement successfully conveys its focus on quality ingredients, health, and the value of rest. Prospects could be looking for a soap brand that not only has organic and safe ingredients, but also encourages its customers to indulge themselves in the relaxing experience of using its product line.

• Connects with the target audience by finding a priority (clean, natural ingredients) and showing how the product meets that need.
• Sells its product(s) in a unique way by emphasizing the feeling it gives customers as well as how the brand makes its products.
• Highlights core values by focusing not only on company values , but the core values its target audience feels are most important.
• Offers a clear and focused message by starting with what its audience is looking for, then sharing how the product meets those needs.

Amazon Positioning Statement:

"For consumers who want to purchase a wide range of products online with quick delivery, Amazon is a one-stop online shopping site. Amazon sets itself apart from other online retailers with its customer obsession, passion for innovation, and commitment to operational excellence."

I like that Amazon cuts straight to the chase with its positioning statement. It clearly outlines that its store is a quick way for its customers to find everything they need, to better help the customer achieve their goals.

• Connects with the target audience by speaking to the needs of busy customers who prioritize convenience.
• Sells its product(s) in a unique way by emphasizing its commitment to customers, experience, and operational excellence.
• Highlights core values by selecting the most relevant brand values and weaving them into the positioning statement.
• Offers a clear and focused message by summarizing the value proposition of the platform.

IMPACT's Positioning Statement:

"Empower your business to thrive with IMPACT. Our They Ask, You Answer approach and consulting services in content marketing, video sales, website strategy, design, and more help you take ownership of your digital sales and marketing. Find out how you can achieve remarkable results and become a trusted voice in your industry with IMPACT."

I think IMPACT ’s positioning statement expertly explains how it goes against the grain to better serve its customers in the market, by eliminating the cycle of dependency. This approach is unique and will attract many prospects to want to learn more about its solutions.

• Connects with the target audience by speaking directly to business owners and marketers who are seeking a solution to marketing dependencies.
• Sells its product(s) in a unique way by clearly outlining what it does and how it accomplishes goals with clients.
• Highlights core values like empowerment, innovation, and trust with a quick explanation of the process and desired outcomes.
• Offers a clear and focused message by packing the most useful terms and ideas into one powerful paragraph.

8. Bandwagon Fan Club

Bandwagon Fan Club Positioning Statement:

"Experience the future of fandom with Bandwagon Fan Club. Our Proof of Experience™ blockchain technology connects sports and entertainment lovers directly with their favorite artists, teams, and entertainers. Choose Bandwagon Fan Club to create, own, and preserve history with cutting-edge technology."

When a product is tough to understand, doubt can creep in and possibly turn customers away. I can see how that could happen with Bandwagon Fan Club since it uses newer technology, but I was impressed by its direct and clear positioning statement. It explains exactly how its technology connects fans directly to their favorite performers and teams and narrows in on the end value.

• Connects with the target audience by centering on the people who will want this product — sports and entertainment super fans.
• Sells its product(s) in a unique way with exclusive technology mentions.
• Highlights core values by emphasizing its customer focus and innovation.
• Offers a clear and focused message — that fans can use this technology to own a unique piece of event history.

9. Gro Intelligence

Gro Intelligence Positioning Statement:

"Develop a holistic data-driven understanding of your impact as a business in the agriculture or climate science industries with Gro Intelligence. We offer live data, machine learning, and domain expertise to provide honest answers where ecology meets economy."

This positioning statement starts with the problem it solves — helping businesses see their impact with data. Then, it explains the technology it uses to show that impact, which builds trust with those potential customers. I like that it:

• Connects with the target audience by targeting businesses in the agriculture and climate sciences industries.
• Sells its product(s) in a unique way by naming the technologies it uses to collect data insights.
• Highlights core values with terms like honest, holistic, economy, and ecology. This word choice quickly communicates what is most important to this brand.
• Offers a clear and focused message by focusing on product benefits and how the brand delivers those benefits.

Nike Positioning Statement:

"For athletes in need of high-quality, fashionable athletic wear, Nike offers customers top-performing sports apparel and shoes made of the highest quality materials. Its products are the most advanced in the athletic apparel industry because of Nike's commitment to innovation and investment in the latest technologies."

Nike’s positioning statement does an excellent job of speaking to its target audience by clearly outlining its range of products to better serve athletes. I also like that it uses inclusive language to define what an athlete is, letting hobbyists and professionals alike know that they can derive value from its product line.

• Connects with the target audience by identifying who uses these products and what they need.
• Sells its product(s) in a unique way through emphasis on innovation and technology in athletic gear production.
• Highlights core values by combining how this brand differentiates itself with a diverse range of customer needs.
• Offers a clear and focused message that is straightforward and covers the most important qualities of its products.

11. Thrive Market

Thrive Market Positioning Statement:

"Thrive Market is an online, membership-based market making the highest-quality, healthy, and sustainable products available for every budget, lifestyle, and geography."

Short and to the point, Thrive Market lets prospects know exactly what it has to offer in a single sentence. Prospects won’t have to guess what type of product they can find from it, and they also know that their line must be extremely versatile, too.

• Connects with the target audience by leading with health and sustainability.
• Sells its product(s) in a unique way by highlighting the membership aspect of its offer.
• Highlights core values by emphasizing quality, health, budget, lifestyle, and location.
• Offers a clear and focused message with a single-sentence positioning statement that is both well-defined and easy to understand.

12. Gig Wage

Gig Wage Positioning Statement:

"Gig Wage uses proprietary technology for payroll services and compliance to offer control and flexibility to contractor-dependent businesses. This platform is specifically for the 1099 economy to manage, pay, and support happy independent workers."

This statement narrows its focus to a collection of employers that need a solution for 1099 workers. Then, it covers what it offers to solve a set of common problems for that audience.

• Connects with the target audience by talking about the needs of both employees and independent contractors.
• Sells its product(s) in a unique way by emphasizing proprietary technology and how that tech can help.
• Highlights core values with a focus on a desired outcome — happy independent workers.
• Offers a clear and focused message . Some positioning statements need to include industry-specific terms that not everyone is familiar with. But this statement pairs those terms with simple language that makes it easy for anyone to read.

Mural Positioning Statement:

"For organizations who need visual collaboration at scale, Mural helps you bring imagination to work from anywhere with agile and design thinking methodologies, sales and consulting, and research and design, all in one platform. Join a growing network of global enterprises, consultancies, schools, and nonprofits using Mural to innovate."

Leading with the primary value your business offers is a smart strategy. This positioning statement quickly lets consumers know you can use this product to visually collaborate from a range of locations. It also offers proof that you can trust this product because it's used by a diverse network of businesses.

• Connects with the target audience by making the need for visual collaboration a priority, then sharing what kinds of companies are already using this tool.
• Sells its product(s) in a unique way by highlighting specific ways businesses and individual users can get value from this product .
• Highlights core values with terms like innovate, collaboration, and imagination. This emphasizes those values for this brand and for companies who want to make those core values a priority.
• Offers a clear and focused message by focusing the first sentence on what the product is and how to use it, then using the second sentence to show who is already using the product.

Apple Positioning Statement:

"For individuals who want the best personal computer or mobile device, Apple leads the technology industry with the most innovative products. Apple emphasizes technological research and advancement and takes an innovative approach to business best practices — it considers the impact our products and processes have on its customers and the planet."

This positioning statement for Apple appeals to people of all different backgrounds. It inspires them to expect quality products made with intent to innovate in a way that helps people and the environment. I think it's also a great example of how to gain a prospects' trust by emphasizing industry authority.

• Connects with the target audience by aligning itself with people who want "the best." It also emphasizes the brand's leadership in the industry.
• Sells its product(s) in a unique way with emphasis on innovative approaches to research and technological advancement.
• Highlights core values by mentioning the customer and environmental impact its products and processes have.
• Offers a clear and focused message that quickly communicates the most important aspects of the brand and products.

15. McDonald's

McDonald's Positioning Statement:

"McDonald's is a leader in the fast-food industry, with quick, friendly service and consistency across thousands of convenient locations. McDonald's' dedication to improving operations and customer satisfaction sets it apart from other fast-food restaurants."

McDonald’s doesn’t narrow its target audience, but instead panders to individuals of all sorts looking for a fast and satisfying service. It also leads with its position as an industry leader to gain prospect trust.

• Connects with the target audience by highlighting the qualities a person might seek in a fast food restaurant. This strategy is effective because it appeals to a broad audience in a specific situation.
• Sells its product(s) in a unique way by mentioning how its operations and customer satisfaction goals differ from a set of competitors. It doesn't compare itself to every restaurant, only fast-food spots.
• Highlights core values by leading the positioning statement with speed, service, convenience, and consistency.
• Offers a clear and focused message in just two simple sentences, this statement shares what is most important to this brand in a compelling way.

16. Beautycounter

Beautycounter Positioning Statement:

"One by one, we are leading a movement to a future where all beauty is clean beauty. We are powered by people, and our collective mission is to get safer products into the hands of everyone. Formulate, advocate, and educate—that’s our motto for creating products that truly perform while holding ourselves to unparalleled standards of safety. Why? It’s really this simple: beauty should be good for you."

Unlike other beauty brands that strive to fix or perfect customers’ complexions without much focus on ingredients, Beautycounter takes the unique stance that beauty should be good for more than your looks. I think its unique focus on cleaner, safer ingredients will attract customers looking to maintain their complexions instead of a temporary fix.

• Connects with the target audience by advocating for cleaner, safer products on behalf of beauty lovers.
• Sells its product(s) in a unique way by communicating higher-than-average safety standards.
• Highlights core values like education and safety, and supporting people looking for clean beauty products.
• Offers a clear and focused message by outlining a clear and easy-to-understand goal, then sharing how it plans to meet that goal.

Craft a Positioning Statement for Your Business

Competition online makes crafting a great positioning statement more important than ever, but I see this as a unique opportunity to make your business stand out, boast your unique value, and connect with your audience.

If you leverage the tips and insights from the experts I spoke to, you can create a positioning statement that paints a clear roadmap for business growth.

Editor's note: This post was originally published in August 2020 and has been updated for comprehensiveness.

Don't forget to share this post!

Related articles.

Startup Due Diligence: What it Is & Why it Matters

What is a Go-to-Market Strategy? GTM Plan Template + Examples

300+ Business Name Ideas to Inspire You [+7 Brand Name Generators]

The Importance of Having a Startup Exit Strategy

10 Top Tech Startups To Watch

The Biggest Pros and Cons of Working for a Startup

15 Startup Newsletters for Entrepreneurs

12 Top Startup Consulting Firms To Improve Your Business

What Is a Startup Founder

Series Funding for Startups and How It Works

Craft your own positioning statement to help promote your business with aligned brand messaging.

Powerful and easy-to-use sales software that drives productivity, enables customer connection, and supports growing sales orgs

• Starting a Business
• Growing a Business
• Small Business Guide
• Business News
• Science & Technology
• Money & Finance
• For Subscribers
• Write for Entrepreneur
• Entrepreneur Store
• United States
• Asia Pacific
• Middle East
• South Africa

Copyright © 2024 Entrepreneur Media, LLC All rights reserved. Entrepreneur® and its related marks are registered trademarks of Entrepreneur Media LLC

Positioning

By Entrepreneur Staff

Positioning Definition:

How you differentiate your product or service from that of your competitors and then determine which market niche to fill

Positioning helps establish your product's or service's identity within the eyes of the purchaser. A company's positioning strategy is affected by a number of variables related to customers' motivations and requirements, as well as by its competitors' actions.

Before you position your product or service, you should answer the following strategic questions about your market and your products or services:

• What's your customer really buying from you? Remember that McDonald's isn't just selling burgers and fries. It sells fast food that tastes the same, no matter when or where it's ordered, in an environment that's clean and friendly to families.
• How's your product or service different from those of your competitors? A cheeseburger is a cheeseburger, you may think. But look how McDonald's, Burger King and Wendy's differentiate their fast food. They offer different side dishes (onion rings at Burger King, french-fried potatoes at McDonald's), different toys with kids' meals (a big incentive for the under-age-10 set), and different ways of cooking their burgers (Burger King's are broiled, McDonald's, grilled).
• What makes your product or service unique? In New England, McDonald's is the only fast-food chain to offer lobster rolls (a lobster salad sandwich served in a grilled hot-dog roll) in the summer.

Once you've answered these strategic questions based on your market research, you can then begin to develop a positioning strategy for your business plan. A positioning statement for a business plan doesn't have to be long or elaborate, but it does need to point out who your target market is, how you'll reach them, what they're really buying from you, who your competitors are, and what your USP (unique selling proposition) is.

Remember, the right image packs a powerful marketing punch. To make it work for you, follow these steps:

• Create a positioning statement for your company. In one or two sentences, describe what distinguishes you from your competition.
• Test your positioning statement. Does it appeal to your target audience? Refine it until it speaks directly to their wants and needs.
• Use the positioning statement in every written communication to customers.
• Create image-marketing materials that communicate your positioning. Don't skimp.
• Include your team in the image-marketing plan. Help employees understand how to communicate your positioning to customers.

More from Marketing

Competition.

Rivalry in business, as for customers or markets

Competitive Analysis

Identifying your competitors and evaluating their strategies to determine their strengths and weaknesses relative to those of your own product or service

Competitive Intelligence

The process of gathering actionable information on your business's competitive environment

Competitive Matrix

A chart that compares your product or service to your competitor(s)

Latest Articles

'creators left so much money on the table': kickstarter's ceo reveals the story behind the company's biggest changes in 15 years.

In an interview with Entrepreneur, Kickstarter CEO Everette Taylor explains the decision-making behind the changes, how he approaches leading Kickstarter, and his advice for future CEOs.

Canva Is Going Viral For a Questionable Musical Performance at a Company Conference: 'Peak Cringe'

Canva Create took place in Los Angeles on May 23.

87 Service Business Ideas to Start Today

Get started in this growing industry, with options that range from IT consulting to childcare.

• Digital Marketing Strategy and Planning
• Content Marketing
• Digital Experience Management (Desktop/mobile website)
• Email Marketing
• Google Analytics
• Marketing Campaign Planning
• Search Engine Optimisation (SEO)
• Social Media Marketing
• Agency growth
• Business-to-Business
• Charity and Not-for-profit
• E-commerce / Retail
• Managing Digital Teams
• Managing Digital Branding
• Managing Digital Transformation
• Managing Lifecycle Marketing
• Managing International Marketing
• Startup and Small Businesses

The segmentation, targeting, positioning (STP) marketing model

How to use Segmentation, Targeting, and Positioning (STP) to develop marketing strategies

Today, the STP marketing model (Segmentation, Targeting, Positioning) is a familiar strategic approach in modern marketing. It is one of the most commonly applied marketing models in practice, with marketing leaders crediting it for efficient, streamlined communications practice.

STP marketing focuses on commercial effectiveness, selecting the most valuable segments for a business and then developing a marketing mix and product positioning strategy for each customer group.

As Martech continues to develop, so do opportunities for segmentation, targeting, and positioning. So whether you're brand new to STP or a seasoned veteran, it can be useful to take stock and double-check you're utilizing every chance you get to reach, interact with, convert, and engage customers.

But, how do you know which customer segments to focus on? We recommend using personas to identify your most valuable customers. Download our free Marketing buyer persona template and checklist for recommendations on how to build effective personas.

Download your free guide to access a 13-point checklist you can use as a template for structuring your personas, plus learn the key questions you need to ask to check the quality of your personas.

Download our Free Resource – Marketing buyer persona template and checklist

Discover why creating quality personas can help you prioritize marketing tactics and increase conversion with our free persona guide.

Access the Marketing buyer persona template and checklist

The STP marketing model

The STP model is useful when creating marketing communications plans since it helps marketers to prioritize propositions and then develop and deliver personalized and relevant messages to engage with different audiences. The three-step funnel consists of market segmentation, market targeting, and product positioning.

Within your research-based market segmentation phase, you are aiming to identify a basis for the segmentation of your target customers, and determine important characteristics to differentiate each market segment.

When creating your targeting and positioning strategy, you must evaluate the potential and commercial attractiveness of each segment, and then develop detailed product positioning for each selected segment, including a tailored marketing mix based on your knowledge of that segment.

STP marketing as a planning tool

Segmentation, targeting, and positioning is an audience-focused rather than product-focused approach to marketing communications, which helps deliver more relevant messages to commercially appealing audiences.

STP is a critical strategy and planning tool, featured in our RACE Planning Framework. RACE supports marketers, managers, and business owners to create a 90-day marketing plan across each stage of their marketing funnel.

So, while STP sits within the planning activities, the benefits of effective segmentation, targeting and positioning can be felt across the types of customers you reach, interact with, convert, and engage.

You can find out more about all the tools and techniques in our RACE Framework when you download your free RACE marketing plan template today

Download our Free Resource – RACE marketing plan template

Quickly summarize your marketing priorities to grow your business and create a competitive advantage with our free marketing plan template.

Access the Free marketing plan template

Applying Segmentation, Targeting and Positioning to digital communications

STP marketing is relevant to digital marketing too at a more tactical communications level. For example, applying marketing personas can help develop more relevant digital communications as shown by these alternative tactical email customer segmentation approaches .

This visual from Dave Chaffey of Smart Insights in his book Digital Marketing: Strategy. Implementation and practice shows how Segmentation, Targeting and Positioning apply to digital marketing strategy.

It reminds us how digital channels offer new options for targeting audiences that weren't available previously, but we need to reserve sufficient budget for. For example:

• Search intent as searchers type keywords when comparing products they are interested in buying
• Interest-based targeting in Facebook, e.g. Prospecting for those interested in Gardening, Gym membership, or Golf
• Targeting through email personalization and on-site personalization based on profile, behavior (e.g. content consumed)

There are also new opportunities to make a brand more compelling through offering new types of value to consumers based on a digital value proposition  or what Jay Baer has called Youtility. This can be via content or interactive tools on websites or mobile apps.

How to use STP marketing?

Through segmentation, you can identify niches with specific needs, mature markets to find new customers, deliver more focused and effective marketing messages.

The needs of each segment are the same, so marketing messages should be designed for each segment to emphasise relevant benefits and features required rather than one size fits all for all customer types. This approach is more efficient, delivering the right mix to the same group of people, rather than a scattergun approach.

You can segment your existing markets based on nearly any variable, as long as it’s effective as the examples below show:

Well-known ways to segment your audience include:

1. demographics.

Breakdown by any combination: age, gender, income, education, ethnicity, marital status, education, household (or business), size, length of residence, type of residence, or even profession/occupation.

An example is Firefox who sells 'coolest things', aimed at a younger male audience. Though, Moshi Monsters, however, is targeted to parents with fun, safe and educational space for younger audiences.

2. Psychographics

This refers to 'personality and emotions' based on behavior, linked to purchase choices, including attitudes, lifestyle, hobbies, risk aversion, personality, and leadership traits. magazines read and TV. While demographics explain 'who' your buyer is, psychographics inform you 'why' your customer buys.

There are a few different ways you can gather data to help form psychographic profiles for your typical customers.

• Interviews : Talk to a few people that are broadly representative of your target audience. In-depth interviews let you gather useful qualitative data to really understand what makes your customers tick. The problem is they can be expensive and difficult to conduct, and the small sample size means they may not always be representative of the people you are trying to target.
• Surveys : Surveys let you reach more people than interviews, but it can be harder to get as insightful answers.
• Customer data: You may have data on what your customers tend to purchase from you, such as data coming from loyalty cards if an FMCG brand or from online purchase history if you are an e-commerce business. You can use this data to generate insights into what kind of products your customers are interested in and what is likely to make them purchase. For example, does discounting vastly increase their propensity to purchase? In which case they might be quite spontaneous.

An example is Virgin Holidays who use segmentation, positioning and targeting to promote their holidays to 6 different audiences.

3. Lifestyle

This refers to Hobbies, recreational pursuits, entertainment, vacations, and other non-work time pursuits.

Companies such as on and off-line magazine will target those with specific hobbies i.e. FourFourTwo for football fans.

Some hobbies are large and well established, and thus relatively easy to target, such as the football fan example. However, some businesses have found great success targeting very small niches very effectively. A great example is the explosion in 'prepping' related businesses, which has gone from a little heard-of fringe activity to a billion-dollar industry in recent years. Apparently now 3.2 million Americans identify as doomsday preppers . A great way to start researching and targeting these kind of niches is Reddit, where people create subReddits to share information about a given interest or hobby.

4. Belief and values

Refers to Religious, political, nationalistic, and cultural beliefs and values.

The Islamic Bank of Britain offers Sharia-compliant banking which meets specific religious requirements.

A strange but interesting example of religious demographics influencing marketing that you might not have guessed is that Mormons are really into 'multi-level marketing'. They're far more likely to be engaged in the practice than any other US group.

Going the extra mile with demographic research can lead to discovering new marketing opportunities and thinking outside the box. For example, did you know the median age of Cadilla Blackwing customers is 10 years younger than that of “regular” Cadillac customers?

5. Life stages

Life stages are the Chronological benchmarking of people’s lives at different stages.

An example is Saga holidays which are only available for people aged 50+. They claim a large enough segment to focus on this life stage.

6. Geography

Drill down by   Country, region, area, metropolitan or rural location, population density or even climate.

An example is Neiman Marcus, the upmarket department store chain in the USA now delivers to the UK.

7. Behaviour

Refers to the nature of the purchase, brand loyalty, usage level, benefits sought, distribution channels used, and reaction to marketing factors.

In a B2B environment, the benefits sought are often about ‘how soon can it be delivered?’ which includes the ‘last-minute’ segment -  the planning in advance segment.

An example is Parcelmonkey.co.uk who offers same-day, next day and international parcel deliveries.

Benefit is the use and satisfaction gained by the consumer.

Smythson Stationery offer similar products to other stationery companies, but their clients want the benefit of their signature packaging: tissue-lined Nile Blue boxes and tied with navy ribbon!

Market targeting

The list below refers to what’s needed to evaluate the potential and commercial attractiveness of each segment.

• Criteria size: The market must be large enough to justify segmenting. If the market is small, it may make it smaller.
• Difference: Measurable differences must exist between segments.
• Money: Anticipated profits must exceed the costs of additional marketing plans and other changes.
• Accessible: Each segment must be accessible to your team and the segment must be able to receive your marketing messages
• Focus on different benefits:  Different segments must need different benefits.

Product positioning

Positioning maps are the last element of the STP process. For this to work, you need two variables to illustrate the market overview.

In the example here, I’ve taken some cars available in the UK. This isn’t a detailed product position map, more of an illustration. If there were no cars in one segment it could indicate a market opportunity.

Expanding on the extremely basic example above, you can unpack the market by mapping your competitors onto a matrix based on key factors that determine purchase.

This chart is not meant to be any kind of accurate representation of the car market, but rather just illustrate how you could use a product positioning map to analyze your own business's current position in the market, and identify opportunities.

For example, as you can see in the gap below, we've identified a possible opportunity in the market for low-priced family cars.

We're not saying this gap actually exists, I'm sure you could think of cars that fit this category, as the car market is an extremely developed and competitive market. However, it does show how you can use the tool to identify gaps in your own market.

An example of a company using STP marketing?

Any time you suspect there are significant, measurable differences in your market, you should consider STP. Especially if you have to create a range of different messages for different groups.

A good example of segmentation is BT Plc, the UK’s largest telecoms company. BT has adopted STP marketing for its varied customer groups; ranging from individual consumers to B2B services for its competitors.

Identifying and defining your target audience is key to efficiently growing your customer base. But to fully benefit from your strategy, you need to set objectives and optimize your marketing activities to achieve your goals.

What to watch for in segmentation, positioning, and targeting marketing strategy

• Make sure the market is large enough to matter and customers can be easily contacted.
• Apply market research to ensure your approach will add value to the existing customer experience, above and beyond competitors.
• As Martech continues to become more sophisticated, to support digital marketers' wants and needs, consider the developments in relation to your product/service.

Original reference sources

Lancaster G. and Massingham, L. (1988)  Essentials of Marketing . Maidenhead, Berkshire, England.  McGraw-Hill.

Smith, W. R. (1956). Product differentiation and market segmentation as alternative marketing strategies.  Journal of Marketing . (Vol. 21, Issue 1, July). p3-8.

By Annmarie Hanlon

Annmarie Hanlon PhD is an academic and practitioner in strategic digital marketing and the application of social media for business. Dr Hanlon has expertise in the strategic application of social media for business and the move from digitization, to digitalization and digital transformation for business. Her expertise spans consumer touch points, online customer service, the use of reviews, the role of influencers, online engagement and digital content. You can follow her update on Twitter https://twitter.com/annmariehanlon

This blog post has been tagged with:

Turbocharge your results with this toolkit containing 11 resources

• Digital marketing models guide
• Digital marketing strategy guide
• Digital marketing plan workbook
• View the Toolkit

The Digital Marketing Strategy And Planning toolkit contains:

FREE marketing planning templates

Start your Digital Marketing Plan today with our Free membership.

• FREE practical guides to review your approach
• FREE digital marketing plan templates
• FREE alerts on the latest developments

Solutions to your marketing challenges

• Digital Transformation
• Email Marketing and Marketing Automation
• Managing Digital Marketing Teams
• Marketing Strategy and Planning
• Multichannel lifecycle marketing

Expert advice by sector

• Business-to-Business (B2B)
• Charity and Not-For-Profit
• E-commerce and Retail
• Sector Technology Innovation
• Startups and Small Businesses

Improve your digital marketing skills with our FREE guides and templates

Join the Conversation

Recommended Blog Posts

How to use Standard Operating Procedures (SOPs) for marketing

Do you, or your organization use SOPs for digital marketing activities? You may not have heard of SOPs, since the technique seems to be more widely used in the US and in markets where the sales process is more technical …..

Creating an integrated marketing strategy with the RACE Framework

Why use a framework to create an integrated marketing strategy? I believe that implementing a digital marketing strategy framework to follow is essential to ensure the success of your integrated marketing strategy. Importantly by agreeing on a marketing plan structure …..

10 reasons you need a digital marketing strategy in 2024

If you want to develop a strategy, where do you start? Well, it can be summarised in two or three sides of A4 in a table linking strategies to SMART objectives and KPIs to make sure you’re on track…

What is positioning?

What does positioning mean in marketing.

A positioning strategy is a set of actions and processes that are designed to improve the image and visibility of a brand, company, or product.

Product marketers should plan for how people in the market will think about their product, as truly the only product positioning that counts is what your customers think as the product has a life of its own. If a customer isn’t thinking about it, your product doesn’t occupy that position.

Successful positioning strategies not only focus on where the product is today but how the product could potentially progress to where you would ideally like it to be in the near future.

Businesses use marketing to communicate their market position to customers and influence their perception of the brand’s products or services. Marketing establishes the brand identity, influencing consumer perceptions of its position in the market relative to the alternatives available from competitors.

“Positioning is not what you do to a product. Positioning is what you do to the mind of the prospect. That is, you position the product in the mind of the prospect.”

(Ries & Trout, 2001)

Positioning vs. messaging

Positioning outlines why your product is unique in comparison to market alternatives. Messaging describes to your target segments what you’ll do to deliver on the promises made in your positioning statement.

Positioning vs. value proposition

A value proposition is different from positioning in that it's a promise you make to your customer and describes the benefits your product or service will bring to your target audience.

Positioning vs. differentiation

Positioning refers to acquiring space in the mind of the consumer. On the other hand, differentiation is a tactic commonly used by companies to make their offering stand out and appeal to their target market more effectively.

Positioning vs. branding

Branding is when a company creates a specific image of a product via the combination of logos, taglines, slogans, and various advertising strategies.

For example, Nike has the tick, the ‘Just Do It’ slogan, and a range of inspirational advertising campaigns. On the other hand, positioning focuses more on the way that a product is viewed by the consumer in comparison to other brands.

What are the different types of positioning?

You can position your product by:

• Customer needs : Knowing your target market and how you will fulfill their specific needs.
• Product price : Positioning your brand/product as competitively priced
• Product quality: Positioning your brand/product as high quality:
• Product use and application: Associating your brand/product with a specific use
• Competitors: Positioning your brand as better than your competitors

What does market positioning mean?

Market positioning is a strategic exercise we use to establish the image of a brand or product in a consumer’s mind.

This is achieved through the four Ps: promotion, price, place, and product. The more detailed your positioning strategy is at defining the Ps, the more effective the strategy will be.

Why is market positioning important?

Positioning can make or break a product, do it right and you’ll have a receptive audience, confident they’ve made the right decision despite a slew of other options. Do it wrong and you’ll be lucky if your product registers with consumers at all.

Market positioning is integral to your company’s branding and how your target market perceives you.

It should embody your core values and communicate your principles to customers. Forming a successful product positioning strategy is one of the most fundamental elements of marketing because it allows your business the opportunity to differentiate itself from its competitors.

Well-executed product positioning also helps internal teams such as sales, marketing, and customer success in delivering exciting customer experiences, oftentimes leading to an upturn in customer retention and stronger advocacy programs .

How market positioning helps you connect with customers

The objective of market positioning is to get customers to view your product and brand as the leader in your respective market.

When market positioning is well executed and completed correctly, this opens up the opportunity for you to connect with your customers. People are interested in purchasing products that resonate with them. If consumers think your product is capable of delivering the benefits they’re looking for, then the likelihood is they’ll buy your product ahead of others that are available.

April Dunford, Founder of Ambient Strategy , explains how to master positioning for growth .

Examples of market positioning

• A ladies' shoe company might position its products as a status symbol,
• A fast-food chain that serves sandwiches might position itself as the healthier fast-food option, or
• A car company might position itself as the safest option for a family.

What is a brand positioning strategy?

Brand positioning is when a company positions its brand in the mind of its customers.

What are the three levels of brand positioning?

There are three types of positioning strategies: comparative, differentiation, and segmentation.

Comparative positioning

Comparative positioning is when a company compares its product or service with alternatives that are available to its target demographic.

This helps establish their USPs and highlights their value when compared with other companies on the market.

Differentiation positioning

Differentiation positioning is when a company focuses on features that can’t be copied by a market rival, i.e. they use the feature to ‘differentiate’ themselves from competitors.

This approach is useful because it allows companies to earmark a particular feature they’re able to offer, that others cannot.

Segmentation positioning

If a company is targeting more than one target audience, segmentation positioning is beneficial, as it helps address the specific needs of each group.

What is the importance of brand positioning?

Brand positioning plays an important role in helping you stand out from other companies offering similar products.

Brand positioning examples

• Pepsi vs Coca-Cola
• Starbucks vs. Caribou Coffee
• Netflix vs Apple TV
• Zoom vs Microsoft Teams

What is product positioning?

Product positioning is a strategic exercise we use to find a product or service’s place in the market. Positioning defines what makes your product different from the others on the market so you can focus on messaging and effectively explain its value to potential customers.

What are the 4 main components of a product positioning statement?

A positioning statement can be split into four segments: the target, the category, the differentiator, and the payoff.

1. The target - It’s important to establish the target before you begin working on your marketing activity. The target market ought to be based on essential criteria including demographics, geography, psychographics, pains, customer needs, and so on.

2. Category - When prospective customers are evaluating a purchase, they need a frame of reference. You need to outline the category in which your brand will be competing. For example, technology, fashion, etc. Providing context for your customer will help establish brand relevance. gives the brand relevance to the customer.

3. Differentiation - When writing a positioning statement, include a solitary point of differentiation; it’s regarded that multiple benefits or features shouldn’t be included as differentiators for your product. This is because the unique features or benefits of your product/service will support the main differentiator.

Remember, don’t use a bold claim that your product is the "the global leader" as your point of differentiation. Instead, explain in detail why you’re the global leader.

Also, ensure you differentiate your product from your customer’s perspective and not a business angle. While having a healthy market share or a large turnover may appeal to you , this isn’t relevant to your customer.

4. The payoff - This part of your positioning statement ties your differentiation to the needs or goals of the target market.

Here, it’s essential to communicate to your target personas exactly how your differentiator will address their user needs.

To reinforce our earlier point, a successful positioning statement hinges on an in-depth understanding of your target market. Any understanding needs to be based on bona fide market research - never rely on internal assumptions.

Positioning vs. narrative design

Product positioning contextualizes a product’s value for customers so they can understand what it brings to the table. Narrative design is when companies create a story for a product in an attempt to engage a buyer persona.

Marcus Andrews explores the differences between the two in an article in which he suggests why narrative design will replace brand positioning .

What are some examples of product positioning?

Now we’ve covered product positioning in some detail, let’s take a look at it in action. Below are a few examples of businesses that have successfully positioned themselves into a gap in the very same market as their competitors.

Delta & JetBlue

When Delta stopped serving peanuts and reduced their legroom, JetBlue entered the market and positioned itself front and center as the airline with gourmet snacks and ample legroom.

Chipotle & Taco Bell

Although both of these brands essentially sell Mexican fast food, Chipotle entered the same market, competing with quality instead of price. One of the company’s adverts stated, “We’re not afraid to say we’re real chickens.” A tagline that positioned the brand as superior in quality to its rival, Taco Bell.

Bumble & Tinder

Bumble was positioned as a dating app that empowers women. After the founder had a negative experience with some of the men on Tinder, she designed the app so that only female users could initiate first contact. Bumble has now also expanded beyond dating and allows users to seek friendship or professional connections.

The Coca-Cola Company & Mother Energy Drinks

This is a slightly different example in that Coca-Cola was essentially fighting against its own positioning of a product in the market, but it’s a great lesson in repositioning.

In 2006 Coca-Cola launched the Mother Energy drink into the Australian market.

The launch campaign was pretty successful, however, the taste of Mother Energy Drink just wasn’t as good as the leading competitors, and repeat purchases were low.

Due to its already high brand awareness and no doubt how much they threw at marketing the brand, Coca-Cola decided to reposition the product. They completely changed the packaging, increased the size of the can, and improved the taste of the energy drink.

The relaunch of the product featured the line – “New Mother, tastes nothing like the old one.” They didn’t shy away from the fact the drink was performing poorly and even poked a bit of fun at themselves in the process.

Ultimately, they successfully repositioned an energy drink that now competes with the two leading energy drinks in the market – V and Red Bull.

How to develop a positioning strategy

Creating a positioning statement.

A positioning statement is a one or two-sentence declaration that identifies your product’s unique value to customers in relation to your main competitors.

They’re used to ensure a company’s marketing efforts are in sync with the brand and value proposition and are avenues for communicating these messages to the target clientele.

Before crafting your positioning statement you need to ask:

• Who is your target customer?
• What category does your product or service belong in?
• What’s the biggest, unique benefit your product or service offers?
• Can you prove that benefit?

From there, you can create a compelling positioning statement.

Positioning statement examples

Apple provides cutting-edge technology for tech-savvy consumers who want the top of line laptops, computers, and mobile devices. Apple promotes inclusion and accessibility for all and takes responsibility for its employees in addition to committing itself to sourcing the highest quality materials and products.

Disney provides unique entertainment for consumers seeking magical experiences and memories. Disney leads the competition by providing every aspect of related products and services to the world and appealing to people of all ages.

Starbucks offers the best coffee and espresso drinks for consumers who want premium ingredients and perfection every time. Starbucks not only values every interaction, making each one unique, but the brand commits itself to the highest quality coffee in the world.

For consumers who want to purchase a wide range of products online with quick delivery, Amazon provides a one-stop online shopping site. Amazon sets itself apart from other online retailers with its customer obsession, passion for innovation, and commitment to operational excellence.

For athletes in need of high-quality, fashionable athletic wear, Nike provides customers with top-performing sports apparel and shoes made of the highest quality materials. Its products are the most advanced in the athletic apparel industry because of Nike's commitment to innovation and investment in the latest technologies.

Lara McCaskill, Senior Manager of Product Marketing at LinkedIn , revealed how she developed positioning statements, during her time at Stitch Fix:

“Positioning is the simplest distillation of how your product is uniquely suited to address a specific customer need and how they will benefit from it. The goal is to keep it simple and concise and then bolster it with value props.

“I’ve tried in vain to stuff my key value props into a positioning statement and it’s never worked. I end up with a mouthful of marketing jargon that isn’t concise or fails to clearly convey the essence of why customers should care about the product.

“A framework that I like to use is What, Who, and Why:

What it is: Using very clear and even plain language, messaging that you’d likely never put in front of a customer.

Who it’s for: Who is the customer that will benefit from this? Be specific about them. Speak to their specific needs and motivations.

Why it matters: This is where you elaborate on what is in it for the customer, how this maps back to what your brand and product do, and how it benefits the customer.

“It’s important to get granular here, as oftentimes the initial benefit or value prop is surface level. For example, when developing value props at Stitch Fix, we knew that the service saves people time and is convenient.

“But so many products promise the allure of time savings, so we sought to think about why a customer actually cares about saving time.

“For Stitch Fix customers, this was so they can spend their time doing something else, likely more enjoyable than the problem your product is solving for. Identify what that thing is.

Value props: What are the unique attributes that your product has and what is it solving for your customer?

What core desires does your product tap into?

“Once you’ve developed the positioning, from the what and why it’s great to have options. There’s never a clear-cut single positioning statement and set of value props for each product. Creating options that index in various directions can help align stakeholders on the direction you want to go.

“As a product marketer, you are usually the closest person to the positioning and the work that it informs. Your stakeholders are looking to your expertise to develop this, and it’s key to enforce that positioning is not customer-facing messaging.

“I intentionally write positioning in the third person and with plain language to avoid any misinterpretation - I don’t want to see my positioning verbatim in marketing collateral.

“To help contextualize this for stakeholders, I like to include real-world examples of how each option would manifest in a marketing campaign. I’ll mock up sample email copy or paid ads to help stakeholders visualize how each of the options comes to life in your marketing strategy.”

It’s not enough to just position your brand to appeal to a certain customer, once you’ve crafted your statement, it’s time to put it to the test. Experiment with it, and ask your customers for feedback on whether or not it achieves its intended goal - and don't ever stop this feedback cycle.

What is a perceptual map and why is it useful for brands?

A perceptual product positioning map is a graphical representation of how your product compares with the competition. They’re designed to compare essential features, including price, features, etc.

Psst! Yes, you! Why not bookmark this guide or download it in eBook format, so you'll always have all these insights at your fingertips? As a bonus, the eBook includes an exclusive article from none other than Daniel Kuperman, positioning pro and Head of Product Marketing at Atlassian!

• Media Guide
• Ambassadors
• Privacy Policy
• Terms of Service
• Help Centre
• PMM Certification

• Build your business

Business Tools

• Profit Margin Calculator
• Business Name Generator
• Slogan Generator
• Traffic Calculator
• Ecommerce Statistics
• Ecommerce Wiki

Free business tools

Start a business and design the life you want – all in one place.

• © 2015-2024 Oberlo

The 7 Best Business Plan Examples (2024)

As an aspiring entrepreneur gearing up to start your own business , you likely know the importance of drafting a business plan. However, you might not be entirely sure where to begin or what specific details to include. That’s where examining business plan examples can be beneficial. Sample business plans serve as real-world templates to help you craft your own plan with confidence. They also provide insight into the key sections that make up a business plan, as well as demonstrate how to structure and present your ideas effectively.

Example business plan

To understand how to write a business plan, let’s study an example structured using a seven-part template. Here’s a quick overview of those parts:

• Executive summary: A quick overview of your business and the contents of your business plan.
• Company description: More info about your company, its goals and mission, and why you started it in the first place.
• Market analysis: Research about the market and industry your business will operate in, including a competitive analysis about the companies you’ll be up against.
• Products and services: A detailed description of what you’ll be selling to your customers.
• Marketing plan: A strategic outline of how you plan to market and promote your business before, during, and after your company launches into the market.
• Logistics and operations plan: An explanation of the systems, processes, and tools that are needed to run your business in the background.
• Financial plan: A map of your short-term (and even long-term) financial goals and the costs to run the business. If you’re looking for funding, this is the place to discuss your request and needs.

7 business plan examples (section by section)

In this section, you’ll find hypothetical and real-world examples of each aspect of a business plan to show you how the whole thing comes together. 

• Executive summary

Your executive summary offers a high-level overview of the rest of your business plan. You’ll want to include a brief description of your company, market research, competitor analysis, and financial information. 

In this free business plan template, the executive summary is three paragraphs and occupies nearly half the page:

• Company description

You might go more in-depth with your company description and include the following sections:

• Nature of the business. Mention the general category of business you fall under. Are you a manufacturer, wholesaler, or retailer of your products?
• Background information. Talk about your past experiences and skills, and how you’ve combined them to fill in the market. 
• Business structure. This section outlines how you registered your company —as a corporation, sole proprietorship, LLC, or other business type.
• Industry. Which business sector do you operate in? The answer might be technology, merchandising, or another industry.
• Team. Whether you’re the sole full-time employee of your business or you have contractors to support your daily workflow, this is your chance to put them under the spotlight.

You can also repurpose your company description elsewhere, like on your About page, Instagram page, or other properties that ask for a boilerplate description of your business. Hair extensions brand Luxy Hair has a blurb on it’s About page that could easily be repurposed as a company description for its business plan. 

• Market analysis

Market analysis comprises research on product supply and demand, your target market, the competitive landscape, and industry trends. You might do a SWOT analysis to learn where you stand and identify market gaps that you could exploit to establish your footing. Here’s an example of a SWOT analysis for a hypothetical ecommerce business: 

You’ll also want to run a competitive analysis as part of the market analysis component of your business plan. This will show you who you’re up against and give you ideas on how to gain an edge over the competition. 

• Products and services

This part of your business plan describes your product or service, how it will be priced, and the ways it will compete against similar offerings in the market. Don’t go into too much detail here—a few lines are enough to introduce your item to the reader.

• Marketing plan

Potential investors will want to know how you’ll get the word out about your business. So it’s essential to build a marketing plan that highlights the promotion and customer acquisition strategies you’re planning to adopt. 

Most marketing plans focus on the four Ps: product, price, place, and promotion. However, it’s easier when you break it down by the different marketing channels . Mention how you intend to promote your business using blogs, email, social media, and word-of-mouth marketing. 

Here’s an example of a hypothetical marketing plan for a real estate website:

Logistics and operations

This section of your business plan provides information about your production, facilities, equipment, shipping and fulfillment, and inventory.

Financial plan

The financial plan (a.k.a. financial statement) offers a breakdown of your sales, revenue, expenses, profit, and other financial metrics. You’ll want to include all the numbers and concrete data to project your current and projected financial state.

In this business plan example, the financial statement for ecommerce brand Nature’s Candy includes forecasted revenue, expenses, and net profit in graphs.

It then goes deeper into the financials, citing:

• Funding needs
• Project cash-flow statement
• Project profit-and-loss statement
• Projected balance sheet

You can use Shopify’s financial plan template to create your own income statement, cash-flow statement, and balance sheet. 

Types of business plans (and what to write for each)

A one-page business plan is a pared down version of a standard business plan that’s easy for potential investors and partners to understand. You’ll want to include all of these sections, but make sure they’re abbreviated and summarized:

• Logistics and operations plan
• Financials 

A startup business plan is meant to secure outside funding for a new business. Typically, there’s a big focus on the financials, as well as other sections that help determine the viability of your business idea—market analysis, for example. Shopify has a great business plan template for startups that include all the below points:

• Market research: in depth
• Financials: in depth

Your internal business plan acts as the enforcer of your company’s vision. It reminds your team of the long-term objective and keeps them strategically aligned toward the same goal. Be sure to include:

• Market research

Feasibility 

A feasibility business plan is essentially a feasibility study that helps you evaluate whether your product or idea is worthy of a full business plan. Include the following sections:

A strategic (or growth) business plan lays out your long-term vision and goals. This means your predictions stretch further into the future, and you aim for greater growth and revenue. While crafting this document, you use all the parts of a usual business plan but add more to each one:

• Products and services: for launch and expansion
• Market analysis: detailed analysis
• Marketing plan: detailed strategy
• Logistics and operations plan: detailed plan
• Financials: detailed projections

Free business plan templates

Now that you’re familiar with what’s included and how to format a business plan, let’s go over a few templates you can fill out or draw inspiration from.

Bplans’ free business plan template

Bplans’ free business plan template focuses a lot on the financial side of running a business. It has many pages just for your financial plan and statements. Once you fill it out, you’ll see exactly where your business stands financially and what you need to do to keep it on track or make it better.

PandaDoc’s free business plan template

PandaDoc’s free business plan template is detailed and guides you through every section, so you don’t have to figure everything out on your own. Filling it out, you’ll grasp the ins and outs of your business and how each part fits together. It’s also handy because it connects to PandaDoc’s e-signature for easy signing, ideal for businesses with partners or a board.

Miro’s Business Model Canvas Template

Miro’s Business Model Canvas Template helps you map out the essentials of your business, like partnerships, core activities, and what makes you different. It’s a collaborative tool for you and your team to learn how everything in your business is linked.

Better business planning equals better business outcomes

Building a business plan is key to establishing a clear direction and strategy for your venture. With a solid plan in hand, you’ll know what steps to take for achieving each of your business goals. Kickstart your business planning and set yourself up for success with a defined roadmap—utilizing the sample business plans above to inform your approach.

Business plan FAQ

What are the 3 main points of a business plan.

• Concept. Explain what your business does and the main idea behind it. This is where you tell people what you plan to achieve with your business.
• Contents. Explain what you’re selling or offering. Point out who you’re selling to and who else is selling something similar. This part concerns your products or services, who will buy them, and who you’re up against.
• Cash flow. Explain how money will move in and out of your business. Discuss the money you need to start and keep the business going, the costs of running your business, and how much money you expect to make.

How do I write a simple business plan?

To create a simple business plan, start with an executive summary that details your business vision and objectives. Follow this with a concise description of your company’s structure, your market analysis, and information about your products or services. Conclude your plan with financial projections that outline your expected revenue, expenses, and profitability.

What is the best format to write a business plan?

The optimal format for a business plan arranges your plan in a clear and structured way, helping potential investors get a quick grasp of what your business is about and what you aim to achieve. Always start with a summary of your plan and finish with the financial details or any extra information at the end.

Want to learn more?

• Question: Are You a Business Owner or an Entrepreneur?
• Bootstrapping a Business: 10 Tips to Help You Succeed
• Entrepreneurial Mindset: 20 Ways to Think Like an Entrepreneur
• 101+ Best Small Business Software Programs 

• Business Essentials
• Leadership & Management

Credential of Leadership, Impact, and Management in Business (CLIMB)

• Entrepreneurship & Innovation
• Digital Transformation
• Finance & Accounting
• Business in Society
• For Organizations
• Support Portal
• Media Coverage
• Founding Donors
• Leadership Team
• Harvard Business School →
• HBS Online →

Digital Marketing Strategy

Key concepts, who will benefit, marketing professionals, non-marketing professionals, entrepreneurs.

What You Earn

Certificate of Completion

Boost your resume with a Certificate of Completion from HBS Online

Earn by: completing this course

Marketing in the Digital Era

• DTC Brands: Fad or Disruption?
• DTC Brands: Innovations and Challenges, Part I
• DTC Brands: Innovations and Challenges, Part II
• Incumbent Responses

Featured Exercises

Crafting a digital marketing plan.

• Setting Objectives
• Defining Target Audience
• Determining Value Proposition
• Identifying Metrics

Acquiring Customers, Part 1: Paid Media

• The Challenges of Reaching and Acquiring Customers Online
• Search Advertising
• Display Advertising
• Utilizing Paid Media Channels
• Measuring Paid Media

Acquiring Customers, Part II: Owned and Earned Media

• Owned Media
• Earned Media
• Influencer Marketing

Engaging Customers

• Personalization
• From Storytelling to Story-Making
• Connecting Customers and Building Community

Allocating Budget and Measuring Success

• Budget Allocation
• Customer Lifetime Value
• Adobe Simulation
• The Future of Marketing

How to Formulate a Successful Business Strategy

Our difference, about the professor.

Sunil Gupta Digital Marketing Strategy

Dates & eligibility.

No current course offerings for this selection.

All applicants must be at least 18 years of age, proficient in English, and committed to learning and engaging with fellow participants throughout the course.

Learn about bringing this course to your organization .

Learner Stories

Digital Marketing Strategy FAQs

What are the learning requirements in order to successfully complete the course, and how are grades assigned.

Participants in Digital Marketing Strategy are eligible for a Certificate of Completion from Harvard Business School Online.

Participants are expected to fully complete all coursework in a thoughtful and timely manner. This will mean meeting each week’s course module deadlines and fully answering questions posed therein. This helps ensure your cohort proceeds through the course at a similar pace and can take full advantage of social learning opportunities. In addition to module and assignment completion, we expect participation in the social learning elements of the course by offering feedback on others’ reflections and contributing to conversations on the platform. Participants who fail to complete the course requirements will not receive a certificate and will not be eligible to retake the course.

More detailed information on course requirements, including the Adobe Data Driven Operating Model Simulation (one of the assignments), will be communicated at the start of the course. No grades are assigned for Digital Marketing Strategy. Participants will either be evaluated as complete or not complete.

Can you tell me a little more about the budget allocation simulation?

The budget allocation simulation (Adobe Data Driven Operating Model Simulation) will be part of module 6 of the course. It is similar to a mini capstone experience, in that it encourages participants to draw on their knowledge from the rest of the course to make investment decisions in the simulation. It is the very same simulation included in the MBA program's required curriculum marketing course, and, while designed to be challenging, it is ungraded and assessed based on completion. We recommend budgeting approximately 1.5 hours to complete the simulation. Full instructions for how to complete the simulation will be provided to course registrants.

What materials will I have access to after completing Digital Marketing Strategy?

You will have access to the materials in every prior module as you progress through the program. Access to course materials and the course platform ends 60 days after the final deadline in the program.

How should I list my certificate on my resume?

Once you've earned your Certificate of Completion, list it on your resume along with the date of completion:

Harvard Business School Online Certificate in Digital Marketing Strategy [Cohort Start Month and Year]

List your certificate on your LinkedIn profile under "Education" with the language from the Credential Verification page:

School: Harvard Business School Online Dates Attended: [The year you participated in the program] Degree: Other; Certificate in Digital Marketing Strategy Field of Study: Leave blank Grade: "Complete" Activities and Societies: Leave blank

Description:

Digital Marketing Strategy is a 7-week, 35-40 hour online certificate program from Harvard Business School. Digital Marketing Strategy equips professionals with the tools, mindset, and trends to make decisions about digital marketing strategy and tactics, including how to position a product or service for success, acquire and engage customers, and measure both performance of near-term campaigns and longer-term customer value.

Related Program

CLIMB enables new and experienced leaders to ignite their careers with a combination of vital and forward-looking business skills, self-reflection, and an immersive cohort-based learning experience with a diverse global network.

Use This Simple Business Plan Outline to Organize Your Plan

12 min. read

Updated April 10, 2024

When starting a business, having a well-thought-out business plan prepared is necessary for success . It helps guide your strategy and prepares you to overcome the obstacles and risks associated with entrepreneurship. In short, a business plan makes you more likely to succeed.

However, like everything in business, starting is often the hardest part. What information do you need? How in-depth should each section be? How should the plan be structured?

All good questions that you can answer by following this business plan outline. 

• What is a business plan outline?

A business plan outline is similar to most business plan templates . It lists the common sections that all business plans should include.

A traditional business plan typically includes an executive summary, an overview of your products and services, thorough market research, a competitive analysis, a marketing and sales strategy, operational and company details, financial projections, and an appendix. 

• Why is a business plan outline important?

Starting with a business plan outline helps ensure that you’re including all of the necessary information for a complete business plan. 

But, depending on what you intend to do with your plan, you may not need all of this information right away. If you’re going to speak with investors or pursue funding, then yes, you’ll need to include everything from this outline.

But, if you’re using your plan to test an idea or help run your business, you may want to opt for a one-page plan . This is a simpler and faster method that is designed to be updated and used day-to-day. 

If you’re unsure of which plan is right for you, check out our guide explaining the differences and use cases for each plan type . 

• 10 key sections in a standard business plan outline

No matter the type of business plan you create, these are the ten basic sections you should include. Be sure to download your free business plan template to start drafting your own plan as you work through this outline.

1. Executive summary

While it may appear first, it’s best to write your executive summary last. It’s a brief section that highlights the high-level points you’ve made elsewhere in your business plan.

Summarize the problem you are solving for customers, your solution, the target market, your team that’s building the business, and financial forecast highlights. Keep things as brief as possible and entice your audience to learn more about your company. 

Keep in mind, this is the first impression your plan and business will make. After looking over your executive summary, your reader is either going to throw your business plan away or keep reading. So make sure you spend the time to get it just right.

Brought to you by

Create a professional business plan

Using ai and step-by-step instructions.

Secure funding

Validate ideas

Build a strategy

2. Products and services

Start the products and services section of your business plan by describing the problem you are solving for your customer. Next, describe how you solve that problem with your product or service. 

If you’ve already made some headway selling your solution, detail that progress here—this is called “traction”. You can also describe any intellectual property or patents that you have if that’s an important part of your business.

3. Market analysis 

You need to know your target market —the types of customers you are looking for—and how it’s changing.

Use the market analysis section of your business plan to discuss the size of your market—how many potential customers exist for your business—and if your potential customers can be segmented into different groups, such as age groups or some other demographic.

4. Competition

Describe your competition in this section. If you don’t have any direct competitors, describe what your customers currently do to solve the problem that your product fixes. 

If you have direct competition, detail what your strengths and weaknesses are in comparison, and how you’ll differentiate from what is already available. 

5. Marketing and sales

Use this business plan section to outline your marketing and sales plan —how you’ll reach your target customers and what the process will be for selling to them.

You’ll want to cover your market position, marketing activities, sales channels, and your pricing strategy. This will likely evolve over time, but it’s best to include anything that clearly details how you will sell and promote your products and services. 

6. Operations

What’s included in the operations section really depends on the type of business you are planning for. If your business has a physical location or other facilities, you’ll want to describe them here. If your business relies heavily on technology or specific equipment or tools, you should describe that technology or equipment here.

You can also use this section to describe your supply chain if that’s an important aspect of your business. 

7. Milestones and metrics

In a business, milestones are important goals that you are setting for your business. They may be important launch dates, or a timeline of when you’ll get regulatory approval—if that’s something you need for your business. Use this section of your plan to describe those milestones and the roadmap you are planning to follow.

You can also describe important metrics for your business, such as the number of sales leads you expect to get each month or the percentage of leads that will become customers.

8. Company overview and team

The company and team section of your plan is an overview of who you are.

It should describe the organization of your business, and the key members of the management team. It should also provide any historical background about your business. For example, you’ll describe when your company was founded, who the owners are, what state your company is registered in and where you do business, and when/if your company was incorporated.

Be sure to include summaries of your key team members’ backgrounds and experience—these should act like brief resumes—and describe their functions with the company. You should also include any professional gaps you intend to fill with new employees.

9. Financial plan and forecasts

Your financial plan should include a sales forecast, profit and loss, cash flow projections, and balance sheet, along with a brief description of the assumptions you’re making with your projections.

If you are raising money or taking out loans, you should highlight the money you need to launch the business. This part should also include a use of funds report—basically an overview of how the funding will be used in business operations. 

And while it’s not required, it may be wise to briefly mention your exit strategy . This doesn’t need to be overly detailed, just a general idea of how you may eventually want to exit your business. 

10. Appendix

The end of your business plan should include any additional information to back up specific elements of your plan. More detailed financial statements, resumes for your management team, patent documentation, credit histories, marketing examples, etc. 

• Detailed business plan outline

If you’re looking for greater insight into what goes into specific planning sections, check out the following outline for a business plan. It can help you develop a detailed business plan or provide guidance as to what may be missing from your current plan. 

Keep in mind that every business plan will look a bit different because every business is unique. After all, business planning is to help you be more successful, so focus on the sections that are most beneficial to your business and skip the sections that aren’t useful or don’t apply. 

To help, we’ve marked sections that are truly optional with an *.

Executive summary

Company purpose / mission statement.

A very brief description of what your business does and/or what its mission is.

Problem We Solve

A summary of the problem you are solving and an identifiable need in the market you are filling.

Our Solution

A description of the product or service you will provide to solve the problem.

Target Market

A defined customer base who will most likely purchase the product or service.

Briefly describe who is behind the business.

Financial Summary

A short overview of revenue goals and profitability timeline.

If you’ve already started selling your product or service, highlight important initial details here.

Funding Needed*

If you are raising money for your business, describe how much capital you need.

Products & Services

Problem worth solving.

A thorough description of the problem or pain points you intend to solve for your customer base. 

A thorough description of your proposed product or service that alleviates the problem for your customer base.

Describe any initial evidence that your customers are excited to spend money on your solution. Initial sales or signed contracts are good signs.

Intellectual Property/Patents*

If this is important for your business, outline it here.

Regulatory Requirements*

If government approval is required for your business, explain the details and timeline.

Future Products and Services*

What products and services might you offer in the future once your initial products and services are successful?

Market Size & Segments

How many potential customers do you have and what potential groups of customers are separated by specific characteristics?

Market Trends*

How consumers in your target market tend to act including purchasing habits, financial trends, and any other relevant factors.

Market Growth*

The perceived potential increase or decrease in the size of your target market.

Industry Analysis*

If your industry is changing or adjusting over time, describe those changes.

Key Customers*

If your business relies on certain important customers, describe who they are here.

Future Markets*

A snapshot of the potential market based on the last few sections and how your business strategy works within it.

Competition 

Current alternatives.

A list of potential competitors. Identifying the competition isn’t always obvious and it may take some digging on your part.

Our Advantages

The strategic advantage(s) that makes your target market more likely to choose you over the competition. 

Barriers to Entry*

If there’s anything that makes it more difficult for other people to start competing with you, describe those barriers.

Marketing & Sales

Market positioning.

Where do your products or services fit into the market? Are you the low-price leader or the premium option?

Unique value proposition*

What’s special about your offering that makes your customers want to choose it over the competition.

Marketing Plan

An outline of your marketing and advertising strategy including costs, advertising channels, and goals.

How do you sell your product or service? Self-serve or with a team of sales representatives?

Pricing Strategy*

Describe your pricing and how it compares to alternatives in the market.

Distribution*

Describe how your product gets in front of customers. Are you selling in stores and online? Which retailers?

SWOT Analysis*

Strengths, weaknesses, opportunities, and threats.

Location & Facilities

If you have a physical presence, describe where and what it is.

What technology is crucial for your business success?

Equipment & Tools

If special equipment or tools are needed for your business, describe them here.

Sourcing and fulfillment*

If you purchase your products or parts for your products from somewhere else, describe that sourcing and supply chain.

Partners and Resources*

If you have key partners that you work with to make your business a success, describe who they are and what services or products they provide.

Milestones and metrics

A detailed roadmap of specific goals and objectives you plan to achieve will help you manage and steer your business.

Key metrics

Performance measurements that help you gauge the overall performance and health of your business.

Company overview and team

Organizational structure.

An overview of the legal structure of your business. 

Company history and ownership

A summary of your company’s history and how it relates to planning your business.

Management team

The team that is starting or running your business and why they are uniquely qualified to make the business a success.

Management team gaps

Key positions that your business will need to fill to make it successful.

Financial plan and forecast

Projected profit and loss.

How much money you will bring in by selling products and/or services and how much profit you will make or lose after accounting for costs and expenses.

Projected cash flow

How and when cash moves in and out of your business. This also includes your overall cash position.

Projected balance sheet

Expected balances for business assets, liabilities, and equity.

Use of funds

If you are raising money either through loans or investment, explain how funds will be used. This is typically meant to be shared with investors or lenders.

Exit strategy

A brief explanation of how you intend to eventually exit from your business. This could include selling the business, going public, transitioning the business to a family member/employee, etc.

A repository for any additional information, including charts and graphs, to support your business plan.

Business plan outline FAQ

How do you organize your business plan?

There’s no real established order to business plans, aside from keeping the Executive Summary at the top. As long as you have all of the main business plan components, then the order should reflect your goals. 

If this is meant solely for your personal use, lay it out as a roadmap with similar sections grouped together for easy reference. If you’re pitching this to potential investors, lead with the stronger sections to emphasize the pitch. Then if you’re unsure of what order makes sense, then just stick to the outline in this article.

Should you include tables and charts in your business plan?

Every business plan should include bar charts and pie charts to illustrate the numbers. It’s a simple way for you, your team, and investors to visualize and digest complex financial information.

Cash flow is the single most important numerical analysis in a business plan, and a standard cash flow statement or table should never be missing. Most standard business plans also include a sales forecast and income statement (also called profit and loss), and a balance sheet.

How long should your business plan be?

There’s no perfect length for a business plan. A traditional business plan can be anywhere from 10 to 50 pages long depending on how much detail you include in each section. However, as we said before unless you intend to pursue funding, you likely don’t need a lengthy business plan at first.

Tim Berry is the founder and chairman of Palo Alto Software , a co-founder of Borland International, and a recognized expert in business planning. He has an MBA from Stanford and degrees with honors from the University of Oregon and the University of Notre Dame. Today, Tim dedicates most of his time to blogging, teaching and evangelizing for business planning.

Table of Contents

Related Articles

2 Min. Read

How Long Should a Business Plan Be?

5 Min. Read

Business Plan Vs Strategic Plan Vs Operational Plan—Differences Explained

10 Min. Read

When Should You Write a Business Plan?

3 Min. Read

11 Key Components of a Business Plan

The Bplans Newsletter

The Bplans Weekly

Subscribe now for weekly advice and free downloadable resources to help start and grow your business.

We care about your privacy. See our privacy policy .

The quickest way to turn a business idea into a business plan

Fill-in-the-blanks and automatic financials make it easy.

No thanks, I prefer writing 40-page documents.

Discover the world’s #1 plan building software

START YOUR ECOMMERCE BUSINESS FOR JUST $1

• Skip to primary navigation
• Skip to main content

A magazine for young entrepreneurs

The best advice in entrepreneurship

Subscribe for exclusive access, how to create a marketing plan in 2024 (template + examples).

Written by Jesse Sumrak | May 28, 2024

Comments -->

Get real-time frameworks, tools, and inspiration to start and build your business. Subscribe here

Marketing is an often misunderstood profession. Peers often stereotype marketing with massive budgets, loosey-goosey timelines, haphazard tactics, high-profile influencers, and Snapchat filters. In reality, modern marketing plans are more complex and orchestrated than a Premier League-winning football team.

Businesses have big goals to hit and fine margins to walk—and they need realistic, yet imaginative, marketing plans to make it happen. Sure, bigger companies can spend all willy-nilly hiring Taylor Swift for a commercial op and dropping a quarter million on Facebook advertising, but small businesses and startups have to get downright strategic with every dollar they spend.

If your business is trying to stretch every penny, you’ve come to the right place. This article will show you how to create a marketing plan in 2024 that actually works with a down-to-earth budget. We’ve included step-by-step actions, outlines, examples, and more to give you everything you need to take an idea to the market with laser precision.

Table of Contents

What is a marketing plan?

How to create a marketing plan

Marketing plan template

Marketing plan example

Marketing Plan FAQs

What Is a Marketing Plan?

A marketing plan is a documented roadmap for how you plan to drive awareness, sales, signups, attendance, or other marketing initiatives. It outlines your KPIs, budget, and timeline, dictating everything from the critical milestones to the nitty-gritty to-do items.

Marketing plans come in all shapes and sizes. You could build an overarching marketing plan to document and guide your entire department’s annual goals and strategies for the upcoming year. Or you might create a marketing plan detailing the launch strategy for the brand-new product release coming out next quarter. Big plans can even include small plans, just like an adorable collection of Russian nesting dolls.

Plans can be short, long, fat, or thin—just remember what your plan is trying to accomplish. If you’re trying to pitch an idea to a team of venture capitalists or a local bank, you might need a chunky document with accompanying spreadsheets and financial figures. However, if you’re trying to communicate the plan to your marketing team leads, you’ll want to skip straight to the point with tactics, deadlines, and deliverables.

Regardless of your use case, the next section will give you the building blocks you need to create a marketing plan that works.

How to Create a Marketing Plan

This section will show you the 7-step process to creating a marketing plan. Plans are fluid and versatile, so we don’t recommend filling out one of these with pen and paper—get your eraser ready because a marketing plan is never perfect from the get-go.

Here’s an overview of the 7-step process:

• Establish Your Marketing Goal
• Identify Your Audience and Competitors
• Set Your Marketing Budget
• Determine Your Deadline(s)
• Pick Your Marketing Channels and Tactics
• Outline the To-Do List and Make Assignments
• Track Performance and Review Analytics

Don’t worry too much about making it all nice and pretty right now. Later, you can use our provided marketing outline to copy, paste, and format a more articulated version for widespread distribution. For now, just focus on hashing out each section and answering the thought-provoking questions.

1. Establish Your Marketing Goal

Define exactly what you’re trying to achieve. Do you want to drive more sales? How much? What about recurring customers? How many? Do you need to increase brand awareness? To whom and by how much?

Work out the details of what you want to accomplish, why, and how you’re going to measure it. Establish your KPIs early on to measure the success of your marketing campaign. You’ll refer to these numbers throughout the rest of your marketing plan, so get specific.

For example, how many website visitors you’re trying to drive will affect your marketing budget, deadlines, and tactics. And if you’re targeting a specific demographic, you may need to engage different marketing teams to use the appropriate channels and messaging.

Fine-tune your marketing goal so that you can communicate it simply in a single sentence. For example: “The goal is to drive 25,000 key decision-makers to the new product page by the end of October with a limited marketing budget of $75,000.”

2. Identify Your Audience and Competitors

Explain who this campaign is targeting. If you’ve already built out your buyer personas, you’ll just plug in the persona appropriate to this campaign. However, if this is your first time thinking long and hard about your target audience, really get to know the person you’re marketing to.

Depending on your product, industry, and market, you’ll want to know demographics like:

• Marital status

These details help you identify a broad audience, but you’ll want to narrow it down with psychographics.

Psychographics dig deeper . They cover your audience’s:

• Influencers
• Shopping behaviors

Demographics explain the “who,” while psychographics explain the “why.”

Think about if you were trying to sell a baseball glove. How you market that glove is going to be very different depending on the buyer. Are your messaging and channels targeting a college athlete, recreational youngster, mom, dad, or low-income family? It’s hard to know what to say and how to say it unless you know who you’re talking to.

Don’t just gloss over this section. Without a target audience, you’ll be blindly throwing darts at a board—sure, some plans might work out, but it’ll come down less to strategy and more to sheer luck. A target audience and replicable formula make your success a science and not a game of Russian roulette.

Once you’ve identified your audience, you need to figure out who’s also targeted the same people. Competition research is a way to understand who you are up against for eyeballs, SEO rankings, and influence, but it also can serve as an opportunity to fill gaps in our needs that your competitors are missing.

One easy way to do this is to look at comment sections or reviews of similar companies in your industry. Look for:

• Frequent complaints about product design.
• Consistent issues with customer service.
• Ads or branding language that falls flat.
• If the competitor hasn’t made a product their customers are asking for.

By identifying your competitor’s weaknesses or gaps their missing with their customers, you’ll have a treasure trove of marketing copy to use in order to differentiate your business from the pack.

3. Set Your Marketing Budget

Marketing plans need budget constraints. Without a cap, plans could hypothetically include:

• 60-second Super Bowl commercial
• Cristiano Ronaldo as a celebrity endorser
• Billboard advertisements along the entirety of Route 66

For most startups, that’s just not a possibility.

And it’s not where the magic happens. Powerful marketing plans turn tiny marketing budgets into impressive ROI. They prioritize the right channels, messaging, and tactics to stretch every dollar to the max.

Decide beforehand how much budget you’ll need to allocate to meet the goals you set in Step 1. When push comes to shove, you may need to throw additional money at the campaign later to get it across the finish line, but stay strong and do your best to create a marketing plan that works with the budget constraints.

Tight on budget but full on creativity? Check out our Small Business Marketing Guide: From Scratch to Success .

4. Determine Your Deadline(s)

Deadlines create the boundaries to your marketing campaign—you can’t have a plan without them. No deadlines mean there’s a never-ending period to achieve your objective, and it’s probably not a good idea to have a 20-year free pass to accomplish that sales goal you set.

Set your deadline. Be realistic, but also be ambitious. The faster you achieve this goal, the faster you can move on to the next one—and each progressive goal should be moving your business forward.

Establish the final deadline for achieving your primary KPI. Then, set the necessary milestones along the journey. For example, you might set milestones for launching different aspects of your campaign, such as hosting 4 webinars, publishing 10 supporting blog posts, or earning a callout in 2 prime news outlets.

Finally, set the start date for when you’ll need to get the ball rolling to meet your deadlines. Don’t assume it’s ASAP—you might have a few weeks to get your ducks in a row instead of immediately heading off into a chaotic marketing battle.

5. Pick Your Marketing Channels and Tactics

This is arguably the funnest part of creating a marketing plan. This is the step where you get to choose the channels, tactics, and deliverables. The right channels and tactics will vary depending on your audience and product or service, but here are the most popular ones to consider:

• Email Marketing: Email marketing is one of the tried-and-true tactics of the digital marketing world. It generates an average ROI of $40 for every $1 invested —you can’t get much more bang for your buck than that. (Check out our complete email masterclass to learn how to conquer this lucrative channel.)
• Social Media Marketing: Whether you’re running organic strategies or targeted paid campaigns , social media marketing is an excellent modern-day tactic for reaching consumers where they’re most comfortable: Instagram, Facebook, Snapchat, YouTube, or TikTok.
• PPC Marketing: Pay-per-click (PPC) marketing lets you run advertising campaigns on search engine pages and other websites across the internet. It’s a competitive way to get your content in front of the right eyeballs.
• Content Marketing: Content marketing paired with a solid search engine optimization (SEO) strategy is a long-term tactic that can drive organic traffic (read: free) to your website for years to come.

And do you know what all these channels have in common? They each give you the ability to monitor your results and track your progress to prove if a channel is worth your time and money. Unlike traditional outbound advertising and its estimated impressions and influence, you know exactly what you’re getting with these digital marketing strategies.

6. Outline the To-Do List and Make Assignments

Here’s where you get into the nitty-gritty of your marketing plan. Step 6 is where you’ll outline everything that needs to get done:

• Launch meeting
• Recurring meetings and syncs
• Creative assets
• Promotional channels
• Post-mortems

And that’s just the start. Outline everything that needs to happen to make your plan a reality. Once you know what needs to happen, it’s time to start making assignments. Someone needs to be responsible for every deliverable.

Here’s where you may run into roadblocks. You may discover that your creative team is overwhelmed and won’t be able to handle the creative requests until later, or you may find that other email campaigns or social media advertisements are the top priority.

If that’s the case, go back to Step 4 to revisit your timeline. Make adjustments to ensure there’s bandwidth available to make your marketing plan a reality.

7. Track Performance and Review Analytics

No marketing plan will go off without a hitch. That’s why you need your ear to the ground to understand what’s working. Through analytic tools, you can understand if your marketing plan’s target audience, messaging, or creative needs adjusting. Thankfully, most digital tactics allow you to do this on the fly.

Make sure you familiarize yourself with these basic marketing analytics tools:

• Facebook Ads Manager
• Google Analytics
• Google Search Console
• Semrush or Ahrefs for SEO

For more on analytics, read our marketing metrics guide .

Marketing Plan Template (Copy/Paste)

Marketing Plan Template: [Name of Project]

Marketing Plan Example (Filled Out)

Here’s a fake content marketing plan example for a fictitious shoe company.

Marketing Plan Template: [Project Zeus Running Collection]

Marketing Goal Drive $200,000 in sales for the new Zeus running collection within the first 4 months of launch day.

Target Audience The primary audience is 35 to 50-year-old male recreational runners who tend to run 30-40 miles a week at an average page of 8:00-10:00 minutes per mile. They’re not overly competitive, but they like to race 5K and 10K races occasionally throughout the year and are always trying to beat their personal best. Many have experienced mild injuries over the last few years that the Zeus Running Collection can help alleviate.

Marketing Budget We have a budget of $40,000 for the initial launch period. If we can prove out the Zeus Running Collection, we’ll allocate additional budget after the first 4 months.

• Launch Day: June 1
• Marketing Assets Ready to Go: May 28
• Pre-Launch Teaser: May 24
• Creative Assets Finished: May 21
• Product Beta Tester Reviews Submitted: May 10
• Written Content Creation Period: April 12 – May 7
• Enlist Beta Testers: April 12
• Project Kickoff Meeting: April 5

Marketing Tactics

• Social Media Marketing: Target runners on Instagram and Facebook with paid ads featuring our endorsed runner racing in the shoe.
• Email Marketing: Email existing customers with a 15% off discount code on the new Zeus Running Collection. Email prospects with a link to the product breakdown page with a code for free shipping.

Responsibilities and Assignments

• Lizzy K: Creative assets
• Mark B: Blog post announcement + product page
• Spencer S: Beta tester outreach
• Larry G: Email and social media marketing campaigns
• Carly M: Project manager

Do I need to write a marketing plan for everything?

As stated earlier, marketing plans can come in all shapes and sizes. But that doesn't mean you need one for every single Facebook ad or whitepaper your team creates. The best marketing plans serve as a source of truth for your team to reach a goal. Within the marketing plan, you should have enough wiggle room to adjust your strategy and tactics. Marketing is an art and science, so there are bound to be surprises once you start executing your plan.

How do I know if my marketing plan is a success?

One of the most common mistakes marketers make is creating a seemingly perfect marketing plan and then going off script as soon as there's a sign of trouble or distraction. Using the SMART goal method (specific, measurable, achievable, relevant, and time bound) is a simple way to ensure your marketing plan is applicable. Every marketing plan should be a success, whether you hit your goal or not, because you'll learn something new about your customer, tactics, and business throughout the process.

Who should make a marketing plan?

If you're reading this article, ideally you. A marketing manager or marketing team member typically writes marketing plans, but marketing strategy should start at an enterprise level. The more people understand the marketing plan for your business, the more you can work together (not in silos) to achieve a common goal. You'll see this happen in larger organizations where the marketing team works plan that the product or sales team have no idea about.

Plan It Out—Make It Happen

Every great campaign starts with an even better plan. Don’t leave your startup’s success up to chance—give it all the thought and attention you can.

With the right plan in place, you won’t be crossing your fingers on launch day or during the quarterly review. You’ll be sitting confidently, knowing that everything is running according to plan.

Need a high-level plan for your startup? We got you covered with our foundr+. Get access for $1. .

About Jesse Sumrak

Jesse Sumrak is a writing zealot focused on creating killer content. He’s spent almost a decade writing about startup, marketing, and entrepreneurship topics, having built and sold his own post-apocalyptic fitness bootstrapped business. A writer by day and a peak bagger by night (and early early morning), you can usually find Jesse preparing for the apocalypse on a precipitous peak somewhere in the Rocky Mountains of Colorado.

Related Posts

What Is UGC and Why It’s a Must-Have for Your Brand

Ad Expert Phoenix Ha on How to Make Creative Ads without Breaking Your Budget

14 Punchy TikTok Marketing Strategies to Amplify Your Growth

How to Grow Your YouTube Channel and Gain Subscribers Quickly

How to Get More Views on Snapchat with These 12 Tactics

12 Instagram Growth Hacks For More Engaged Followers (Without Running Ads)

Create Viral Infographics That Boost Your Organic Traffic

How to Create a Video Sales Letter (Tips and Tricks from a 7-Figure Copywriter)

How to Write a Sales Email That Converts in 2024

What Is a Media Kit: How to Make One in 2024 (With Examples)

Namestorming: How to Choose a Brand Name in 20 Minutes or Less

10 Ways to Increase Brand Awareness without Increasing Your Budget

What Is a Content Creator? A Deep Dive Into This Evolving Industry

Content Creator vs Influencer: What’s the Difference?

How Much Do YouTube Ads Cost? A Beginner’s Pricing Breakdown

FREE TRAINING FROM LEGIT FOUNDERS

Actionable Strategies for Starting & Growing Any Business.

Don't Miss Out! Get Instant Access to foundr+ for Just $1!

1000+ lessons. customized learning. 30,000+ strong community..

How To Write a Nail Salon Marketing Plan + Template & Examples

In this article, we will describe what should be included in each component of your marketing plan and provide some marketing strategies that can help you generate leads, build credibility, and strengthen the brand of your nail salon.

Download our Ultimate Marketing Plan Template here

What is a Marketing Plan for a Nail Salon?

A nail salon marketing plan is a written document that outlines the specific actions you’ll take to generate leads, convert prospects into customers, and retain customers over time. This document is a crucial component of your larger nail salon business plan , as it details how you’ll attract and retain customers.

Your marketing plan should be built around your unique selling proposition (USP), which is the one thing that sets you apart from other nail salon businesses in your market. From there, you’ll need to develop targeted marketing campaigns, create compelling offers, and craft a promotions strategy that will reach your ideal customers.

For example, if your USP is that you offer vegan and eco-friendly nail services, then your marketing plan might include strategies for reaching environmentally-conscious consumers through social media, partnerships with sustainable brands, and targeted email campaigns.

Once you have all of the pieces in place, you’ll need to track your progress and adjust your plan accordingly. The best way to do this is to set measurable goals and track your results regularly.  

Why You Need a Nail Salon Marketing Plan?

There are many reasons why you need a marketing plan to start your nail salon . First and foremost, it will help you focus your efforts and ensure that you’re making the best use of your time and money.

With a well-crafted marketing plan in place, you’ll be able to track your progress and make necessary adjustments along the way. This will help you fine-tune your marketing efforts and eventually achieve the results you’re looking for.

In addition, a marketing plan will also give you a written record of your marketing activities. This can come in handy if you ever need to justify your marketing expenditures or report on your progress to stakeholders.

Finally, a marketing plan can help you avoid common mistakes that many nail salon businesses make. By taking the time to develop a comprehensive marketing plan, you’ll be in a much better position to avoid these pitfalls and set yourself up for success.  

Marketing Plan Basics

A typical marketing plan includes the following components:

Executive Summary

Target market segments, unique selling proposition (usp), pricing and positioning strategy, marketing materials, promotions strategy, digital marketing plan, conversion, referral, and retention strategy, financial projections, how to write a nail salon marketing plan.

The first section of your nail salon marketing plan should be written as the final section of your marketing plan.

In two or three pages, summarize all of the information you have presented in the other sections and include a summary version of any graphs or charts you have included.

You should also include your marketing goals, objectives, and success metrics for the first year of operations.  

Begin by dividing your potential customers into segments based on their demographics, geography, lifestyle, behavior, or any other factors that are relevant to your organization’s cause. Be sure to explain how you determined these target market segments.

For example, a nail salon business that specializes in natural nail care might target environmentally-conscious individuals, while a salon that offers luxury services may focus on affluent customers.

Once you have identified your target market segments, you’ll need to create buyer personas for each one. A buyer persona is a fictional character that represents a specific type of customer that you’re trying to reach.

When creating buyer personas, be sure to include detailed information about their demographics, behaviors, needs, and goals. This will help you develop targeted marketing campaigns that are more likely to resonate with each segment.  

Your USP is the one thing that sets you apart from other nail salon businesses in your market. It’s what makes you unique and it’s what will make prospective customers want to do business with you.

To develop your USP, start by brainstorming a list of all the things that make your nail salon business unique. Then, narrow down this list to the one or two things that are most important to your target market segments.  

This section should cover your pricing strategy, how you determine pricing, and what sets your prices apart from those of competitors. If there are specific circumstances that might affect your pricing strategy for certain types of customers or in certain market conditions, be sure to mention them here.

For example, a nail salon business that uses all-natural and organic products may charge a premium for its services compared to other salons. This would be an important detail to include in the pricing and positioning strategy section of the marketing plan.

You should also include your positioning strategy in this section. Positioning is how you want your nail salon business to be perceived by potential customers. For example, you may want to position your business as a luxury spa experience or a budget-friendly option.

To develop your positioning strategy, start by thinking about the things that are most important to your target market segments. What needs do they have that you can address? What are their pain points? How can you position your business as the best choice to meet their needs?  

Describe your company’s products and services in this section. Include any special offers, seasonal promotions, or plans to expand into new goods or services in the future. You will also want to include information about prices, discounts for bulk purchases, payment options, how frequently you offer sales, etc.

For example, nail salon businesses might offer a special promotion for bridal parties or a loyalty program for repeat customers.  

In this section, you’ll want to include information about the marketing materials you use to promote your business. This might include your website, brochures, business cards, email newsletters, and social media accounts.

You should also include information about how often you update your marketing materials and what kinds of content you include in them. For example, nail salon businesses might regularly update their website with new nail art designs or post before and after photos on social media to showcase their services.  

Your promotions strategy should detail how you plan to generate interest in your products and services. This might include trade shows, webinars, speaking engagements, press releases, or social media campaigns.

You should also include information about how often you run promotions and what kind of marketing budget you have for them. For example, a nail salon business might offer a discount for first-time customers or team up with other local businesses to cross-promote services.  

In this section, you’ll want to detail your plans for reaching potential customers online. For a comprehensive digital marketing strategy, you should include search engine optimization (SEO), pay-per-click (PPC) advertising, social media marketing, and email marketing.

You should also include information about how often you’ll update your website, blog, and social media accounts. For example, a nail salon might commit to posting two blog articles per week and updating its social media accounts daily.  

Your conversion, referral, and retention strategy should detail how you plan to turn potential customers into paying customers and keep them coming back for more.

This might include:

• Creating incentives for referrals from existing customers
• Offering rewards or loyalty programs for repeat customers
• Providing excellent customer service to encourage positive reviews and recommendations.

Finally, it might include a loyalty program or other perks to thank your most loyal customers and keep them coming back.  

In this section, you should include your plans for generating revenue and growing your nail salon business. This might include information about your target customers, pricing strategy, distribution strategy, and promotions strategy. They should also include your nail salon startup costs .

You should also include financial statements for your nail salon business such as your income statement, balance sheet, and cash flow statement.  

Common Marketing Strategies for a Nail Salon Business

Although every nail salon business will need to develop a marketing plan that meets its own unique needs, here are some common strategies you may choose to implement.

• Targeted Advertising: Utilize targeted advertising platforms such as Facebook Ads or Google Ads to reach potential customers in your area. This allows you to specify the demographics, interests, and behaviors of your target market segments.
• Social Media Marketing: Use social media platforms like Instagram, Pinterest, and Twitter to showcase your services, engage with customers, and build a following. You can also partner with influencers or collaborate with other businesses in the beauty industry to reach a larger audience.
• Email Marketing: Keep your customers informed about new services, promotions, and salon updates through email newsletters. This is a great way to stay in touch with existing customers and encourage repeat visits.
• Partnerships and Collaborations: Partnering with local businesses, such as hair salons or bridal shops, can help you reach new customers and cross-promote services. You can also collaborate with beauty brands to offer exclusive products or discounts.
• Referral Programs: Encourage current customers to refer their friends and family by offering incentives, such as a discount on their next visit or a free service after a certain number of referrals. This is a cost-effective way to attract new customers and retain existing ones.
• Community Involvement: Participate in community events or sponsor local charities to increase brand awareness and showcase your commitment to giving back. This can also help you build relationships with potential customers in your area.

The marketing strategy that you choose will strictly depend on the ideal customer and where you are most likely to reach them.  

Sample Marketing Plan for a Nail Salon Business

Example – polish perfection.

Our nail salon is positioned as an upscale and luxurious option for individuals seeking a personalized and high-quality experience. Our target market includes women aged 18-40, professionals with disposable income, brides and bridal parties, and high school/college students. We offer non-toxic and cruelty-free products, exceptional customer service, and a relaxing atmosphere. Our marketing strategy includes various promotions, collaborations, and a strong digital presence.

We project sales of $200,000 in the first year and aim to increase brand awareness, customer retention, and online bookings over time. So even though our target market may be focused on specific areas or demographics, we strive to provide a welcoming and inclusive environment for all individuals who want to feel pampered and beautiful. Our salon is not just a business, but a community where everyone is valued and celebrated. We look forward to serving our clients and establishing ourselves as the go-to nail salon in the local area.  

• Women aged 18-40
• Professionals with disposable income
• Brides and bridal parties
• High school and college students

Demographics

Women aged 18-40:

• Located in urban and suburban areas
• College-educated
• Working professionals or students
• Middle to high-income level

Professionals with disposable income:

• Located in urban areas
• High-income level
• Young professionals or established career individuals

Brides and bridal parties:

• Located in suburban or rural areas
• Engaged women aged 25-35

High school and college students:

• Middle to low-income level

Psychographics

• Interested in self-care and beauty
• Social media-savvy
• Health-conscious
• Willing to spend money on luxury services
• Fast-paced lifestyle, seeking convenience and quality services
• Value self-image and presentation
• Willing to pay for premium services
• Interested in beauty and pampering for special occasions
• Budget-conscious but willing to splurge for important events
• Looking for a reliable and high-quality salon experience
• Trendy and interested in trying new styles
• Price-sensitive, looking for affordable options

Our nail salon offers a luxurious and personalized experience with high-quality products, skilled technicians, and exceptional customer service. We prioritize the health and safety of our clients by using only non-toxic and cruelty-free products. Our salon also offers a relaxing atmosphere with complimentary refreshments and Wi-Fi.  

Our nail salon is positioned as a premium and upscale option in the market. We offer higher quality services and products at slightly higher prices than our competitors. However, we also offer special discounts and packages for students, brides, and loyal customers to cater to different target segments.  

Distribution Strategy

Our nail salon will mainly operate through our physical location, but we will also have an online booking system and social media pages for customers to make appointments and stay updated on promotions and services. We may also partner with other beauty businesses and bridal shops to reach a wider audience.  

• Loyalty program for repeat customers
• Student discounts
• Bridal packages and group services
• First-time customer promotions
• Business cards with contact information and promotions
• Brochures showcasing services and pricing
• Posters and flyers distributed in the local area
• Social media graphics and posts highlighting current offers
• Email newsletters with updates, promotions, and tips for nail care
• Signage outside and inside the salon promoting current deals or events. Additionally, signage can include special messages about the salon’s values, such as non-toxic products or community involvement.
• Social media contests and giveaways to engage with followers and attract new customers
• Referral program offering discounts for successful referrals
• Collaborations with beauty influencers or partnerships with local businesses
• Sponsorship of community events or charities

Our digital marketing plan will focus on promoting our salon through various online channels, including social media, email marketing, and paid advertisements. We will also utilize search engine optimization (SEO) tactics to improve our online visibility and attract more customers.  

Our conversion strategy will focus on providing a high-quality and personalized experience to our clients. We will also offer special promotions and packages for first-time customers to encourage them to become regulars. Our referral program and loyalty program will incentivize current clients to refer others and continue using our services.  

Our projected sales for the first year are $200,000 with an expected increase of 10% each year. Our estimated expenses include rent, supplies, employee salaries, and marketing costs. We anticipate breaking even in the first year and achieving a profit margin of 15-20% within three years.  

Marketing Objectives:

• Increase brand awareness by 25% within the first year of operation.
• Acquire a minimum of 500 social media followers on Instagram and Facebook within the first six months.
• Achieve a customer retention rate of 40% in the first year, increasing to 60% by the third year.
• Generate $50,000 in sales from bridal parties within the first year.
• Increase online bookings by 50% within the second year.
• Collaborate with at least three local businesses for cross-promotion within the first year of operation.

Free Nail Salon Business Plan Example PDF

Download our nail salon business plan pdf here. This is a free nail salon business plan example to help you get started on your own nail salon plan.  

How to Finish Your Nail Salon Marketing Plan in 1 Day!

Don’t you wish there was a faster, easier way to finish your marketing plan?

With Growthink’s Ultimate Marketing Plan Template you can finish your plan in just 8 hours or less!

7 Organizational Structure Types (With Examples)

Updated: May 29, 2024, 5:39pm

Table of Contents

What is an organizational structure, 4 common types of organizational structures, 3 alternative organizational structures, how to choose the best organizational structure, frequently asked questions (faqs).

Every company needs an organizational structure—whether they realize it or not. The organizational structure is how the company delegates roles, responsibilities, job functions, accountability and decision-making authority. The organizational structure often shows the “chain of command” and how information moves within the company. Having an organizational structure that aligns with your company’s goals and objectives is crucial. This article describes the various types of organizational structures, the benefits of creating one for your business and specific elements that should be included.

Employees want to understand their job responsibilities, whom they report to, what decisions they can and should make and how they interact with other people and teams within the company. An organizational structure creates this framework. Organizational structures can be centralized or decentralized, hierarchical or circular, flat or vertical.

Centralized vs. Decentralized

Many companies use the traditional model of a centralized organizational structure. With centralized leadership, there is a transparent chain of command and each role has well-defined responsibilities.

Conversely, with a decentralized organizational structure, teams have more autonomy to make decisions and there may be cross-collaboration between groups. Decentralized leadership can help companies remain agile and adapt to changing needs.

Hierarchical vs. Circular

A hierarchical organization structure is the pyramid-shaped organization chart many people are used to seeing. There is one role at the top of the pyramid and the chain of command moves down, with each level decreasing in responsibilities and authority.

On the other hand, a circular organization chart looks like concentric circles with company leadership in the center circle. Instead of information flowing down to the next “level,” information flows out to the next ring of management.

Vertical vs. Flat

A vertical organizational chart has a clear chain of command with a small group of leaders at the top—or in the center, in the case of a circular structure—and each subsequent tier has less authority and responsibility. As discussed below, functional, product-based, market-based and geographical organizational structures are vertical structures.

With a flat organization structure, a person may report to more than one person and there may be cross-department responsibilities and decision-making authority. The matrix organizational structure described below is an example of a flat structure.

Benefits of Creating an Organizational Structure

There are many benefits to creating an organizational structure that aligns with the company’s operations, goals and objectives. Clearly disseminating this information to employees:

• Provides accountability
• Clarifies expectations
• Documents criteria for promotion
• Designates decision-making authority
• Creates efficiency
• Fosters collaboration

Essential Elements of Clear Organizational Structure

Regardless of the special type of organizational structure you choose, it should have the following components:

• Chain of command
• Roles and responsibilities
• Scope of control
• Decision-making authority
• Departments or teams within the organization

Functional/Role-Based Structure

A functional—or role-based—structure is one of the most common organizational structures. This structure has centralized leadership and the vertical, hierarchical structure has clearly defined roles, job functions, chains of command and decision-making authority. A functional structure facilitates specialization, scalability and accountability. It also establishes clear expectations and has a well-defined chain of command. However, this structure runs the risk of being too confining and it can impede employee growth. It also has the potential for a lack of cross-department communication and collaboration.

Product- or Market-Based Structure

Along with the functional structure, the product- or market-based structure is hierarchical, vertical and centralized. However, instead of being structured around typical roles and job functions, it is structured around the company’s products or markets. This kind of structure can benefit companies that have several product lines or markets, but it can be challenging to scale. It can also foster inefficiency if product or market teams have similar functions, and without good communication across teams, companies run the risk of incompatibility among various product/market teams.

Geographical Structure

The geographical structure is a good option for companies with a broad geographic footprint in an industry where it is essential to be close to their customers and suppliers. The geographical structure enables the company to create bespoke organizational structures that align with the location’s culture, language and professional systems. From a broad perspective, it appears very similar to the product-based structure above.

Process-Based Structure

Similar to the functional structure, the process-based structure is structured in a way that follows a product’s or service’s life cycle. For instance, the structure can be broken down into R&D, product creation, order fulfillment, billing and customer services. This structure can foster efficiency, teamwork and specialization, but it can also create barriers between the teams if communication isn’t prioritized.

Matrix Structure

With a matrix organizational structure, there are multiple reporting obligations. For instance, a marketing specialist may have reporting obligations within the marketing and product teams. A matrix structure offers flexibility, enables shared resources and fosters collaboration within the company. However, the organizational structure can be complex, so it can cause confusion about accountability and communication, especially among new employees.

Circular Structure

Similar to the functional and product-based structure, a circular structure is also centralized and hierarchical, but instead of responsibility and decision-making authority flowing down vertically, responsibility and decision-making authority flow out from the center. A circular structure can promote communication and collaboration but can also be confusing, especially for new employees, because there is no clear chain of command.

Organic Structure

Unlike vertical structures, this structure facilitates communication between and among all staff. It is the most complex, but it can also be the most productive. Although it can be challenging to know who has ultimate decision-making authority, it can also foster a positive company culture because employees don’t feel like they have “superiors.” This structure can also be more cost-efficient because it reduces the need for middle managers.

There is no one “right” organizational structure. When deciding which structure will work best for your company, consider the following:

• Current roles and teams within the company. How are job functions currently organized? Does it foster communication and productivity? Does it impede or encourage employee growth?
• Your strategic plan. What are your company’s goals for the short-term and long-term?
• Feedback from employees, leadership and other stakeholders. What do those within your company say about how the company is structured? What feedback do you have from other stakeholders, such as customers and suppliers?
• Alignment. What structure will best support your strategic plans and address any feedback received?

What is the most common organizational structure?

A functional organizational structure is one of the most common organizational structures. If you are still determining what kind of structure to use, this organizational structure can be an excellent place to start.

What is the difference between an organizational structure and an organizational chart?

An organizational chart is a graphic that depicts the organizational structure. The chart may include job titles or it can be personalized to include names and photos.

What are the four types of organizational structures?

A functional—or role-based—structure is one of the most common organizational structures. The second type—the product- or market-based structure—is also hierarchical, vertical and centralized. Similar to these is the third structure—the process-based structure—which is structured in a way that follows a product’s or service’s life cycle. Lastly, the geographical structure is suitable for businesses with a broad geographic footprint.

• Best HR Software
• Best HCM Software
• Best HRIS Systems
• Best Employee Management Software
• Best Onboarding Software
• Best Talent Management Software
• Best HR Outsourcing Services
• Best Workforce Management Software
• Best Time And Attendance Software
• Best Employee Scheduling Software
• Best Employee Time Tracking Apps
• Best Free Time Tracking Apps
• Best Employee Training Software
• Best Employee Monitoring Software
• Best Enterprise Learning Management Systems
• Best Time Clock Software
• Best ERP Systems
• Zenefits Review
• Oracle HCM Review
• UKG Pro Review
• IntelliHR Review
• ADP Workforce Now Review
• ADP TotalSource Review
• SuccessFactors Review
• Connecteam Review
• What is Human Resources?
• Employee Benefits Guide
• What is Workforce Management?
• What is a PEO?
• What is Human Capital Management?
• HR Compliance Guide
• Strategic Human Resource Management
• Onboarding Checklist
• Benefits Administration Guide
• What Is Employee Training?
• Employee Development Plan
• 30-60-90 Day Plan Guide
• How To Calculate Overtime
• What Is Outplacement?
• New Hire Orientation Checklist
• HR Analytics Guide

Next Up In Business

• 10 Management Styles Of Effective Leaders
• Recruitment Process Outsourcing: The Ultimate Guide
• Attendance Policy Template
• What Is Rightsizing?
• Administrative Assistant Job Description
• What Are Voluntary Benefits?

How To Start A Print On Demand Business In 2024

HR For Small Businesses: The Ultimate Guide

How One Company Is Using AI To Transform Manufacturing

Not-For-Profit Vs. Nonprofit: What’s The Difference?

How To Develop an SEO Strategy in 2024

How To Make Money On Social Media in 2024

Christine is a non-practicing attorney, freelance writer, and author. She has written legal and marketing content and communications for a wide range of law firms for more than 15 years. She has also written extensively on parenting and current events for the website Scary Mommy. She earned her J.D. and B.A. from University of Wisconsin–Madison, and she lives in the Chicago area with her family.

The state of AI in 2023: Generative AI’s breakout year

You have reached a page with older survey data. please see our 2024 survey results here ..

The latest annual McKinsey Global Survey  on the current state of AI confirms the explosive growth of generative AI (gen AI) tools . Less than a year after many of these tools debuted, one-third of our survey respondents say their organizations are using gen AI regularly in at least one business function. Amid recent advances, AI has risen from a topic relegated to tech employees to a focus of company leaders: nearly one-quarter of surveyed C-suite executives say they are personally using gen AI tools for work, and more than one-quarter of respondents from companies using AI say gen AI is already on their boards’ agendas. What’s more, 40 percent of respondents say their organizations will increase their investment in AI overall because of advances in gen AI. The findings show that these are still early days for managing gen AI–related risks, with less than half of respondents saying their organizations are mitigating even the risk they consider most relevant: inaccuracy.

The organizations that have already embedded AI capabilities have been the first to explore gen AI’s potential, and those seeing the most value from more traditional AI capabilities—a group we call AI high performers—are already outpacing others in their adoption of gen AI tools. 1 We define AI high performers as organizations that, according to respondents, attribute at least 20 percent of their EBIT to AI adoption.

The expected business disruption from gen AI is significant, and respondents predict meaningful changes to their workforces. They anticipate workforce cuts in certain areas and large reskilling efforts to address shifting talent needs. Yet while the use of gen AI might spur the adoption of other AI tools, we see few meaningful increases in organizations’ adoption of these technologies. The percent of organizations adopting any AI tools has held steady since 2022, and adoption remains concentrated within a small number of business functions.

Table of Contents

• It’s early days still, but use of gen AI is already widespread
• Leading companies are already ahead with gen AI
• AI-related talent needs shift, and AI’s workforce effects are expected to be substantial
• With all eyes on gen AI, AI adoption and impact remain steady

About the research

1. it’s early days still, but use of gen ai is already widespread.

The findings from the survey—which was in the field in mid-April 2023—show that, despite gen AI’s nascent public availability, experimentation with the tools  is already relatively common, and respondents expect the new capabilities to transform their industries. Gen AI has captured interest across the business population: individuals across regions, industries, and seniority levels are using gen AI for work and outside of work. Seventy-nine percent of all respondents say they’ve had at least some exposure to gen AI, either for work or outside of work, and 22 percent say they are regularly using it in their own work. While reported use is quite similar across seniority levels, it is highest among respondents working in the technology sector and those in North America.

Organizations, too, are now commonly using gen AI. One-third of all respondents say their organizations are already regularly using generative AI in at least one function—meaning that 60 percent of organizations with reported AI adoption are using gen AI. What’s more, 40 percent of those reporting AI adoption at their organizations say their companies expect to invest more in AI overall thanks to generative AI, and 28 percent say generative AI use is already on their board’s agenda. The most commonly reported business functions using these newer tools are the same as those in which AI use is most common overall: marketing and sales, product and service development, and service operations, such as customer care and back-office support. This suggests that organizations are pursuing these new tools where the most value is. In our previous research , these three areas, along with software engineering, showed the potential to deliver about 75 percent of the total annual value from generative AI use cases.

In these early days, expectations for gen AI’s impact are high : three-quarters of all respondents expect gen AI to cause significant or disruptive change in the nature of their industry’s competition in the next three years. Survey respondents working in the technology and financial-services industries are the most likely to expect disruptive change from gen AI. Our previous research shows  that, while all industries are indeed likely to see some degree of disruption, the level of impact is likely to vary. 2 “ The economic potential of generative AI: The next productivity frontier ,” McKinsey, June 14, 2023. Industries relying most heavily on knowledge work are likely to see more disruption—and potentially reap more value. While our estimates suggest that tech companies, unsurprisingly, are poised to see the highest impact from gen AI—adding value equivalent to as much as 9 percent of global industry revenue—knowledge-based industries such as banking (up to 5 percent), pharmaceuticals and medical products (also up to 5 percent), and education (up to 4 percent) could experience significant effects as well. By contrast, manufacturing-based industries, such as aerospace, automotives, and advanced electronics, could experience less disruptive effects. This stands in contrast to the impact of previous technology waves that affected manufacturing the most and is due to gen AI’s strengths in language-based activities, as opposed to those requiring physical labor.

Responses show many organizations not yet addressing potential risks from gen AI

According to the survey, few companies seem fully prepared for the widespread use of gen AI—or the business risks these tools may bring. Just 21 percent of respondents reporting AI adoption say their organizations have established policies governing employees’ use of gen AI technologies in their work. And when we asked specifically about the risks of adopting gen AI, few respondents say their companies are mitigating the most commonly cited risk with gen AI: inaccuracy. Respondents cite inaccuracy more frequently than both cybersecurity and regulatory compliance, which were the most common risks from AI overall in previous surveys. Just 32 percent say they’re mitigating inaccuracy, a smaller percentage than the 38 percent who say they mitigate cybersecurity risks. Interestingly, this figure is significantly lower than the percentage of respondents who reported mitigating AI-related cybersecurity last year (51 percent). Overall, much as we’ve seen in previous years, most respondents say their organizations are not addressing AI-related risks.

2. Leading companies are already ahead with gen AI

The survey results show that AI high performers—that is, organizations where respondents say at least 20 percent of EBIT in 2022 was attributable to AI use—are going all in on artificial intelligence, both with gen AI and more traditional AI capabilities. These organizations that achieve significant value from AI are already using gen AI in more business functions than other organizations do, especially in product and service development and risk and supply chain management. When looking at all AI capabilities—including more traditional machine learning capabilities, robotic process automation, and chatbots—AI high performers also are much more likely than others to use AI in product and service development, for uses such as product-development-cycle optimization, adding new features to existing products, and creating new AI-based products. These organizations also are using AI more often than other organizations in risk modeling and for uses within HR such as performance management and organization design and workforce deployment optimization.

AI high performers are much more likely than others to use AI in product and service development.

Another difference from their peers: high performers’ gen AI efforts are less oriented toward cost reduction, which is a top priority at other organizations. Respondents from AI high performers are twice as likely as others to say their organizations’ top objective for gen AI is to create entirely new businesses or sources of revenue—and they’re most likely to cite the increase in the value of existing offerings through new AI-based features.

As we’ve seen in previous years , these high-performing organizations invest much more than others in AI: respondents from AI high performers are more than five times more likely than others to say they spend more than 20 percent of their digital budgets on AI. They also use AI capabilities more broadly throughout the organization. Respondents from high performers are much more likely than others to say that their organizations have adopted AI in four or more business functions and that they have embedded a higher number of AI capabilities. For example, respondents from high performers more often report embedding knowledge graphs in at least one product or business function process, in addition to gen AI and related natural-language capabilities.

While AI high performers are not immune to the challenges of capturing value from AI, the results suggest that the difficulties they face reflect their relative AI maturity, while others struggle with the more foundational, strategic elements of AI adoption. Respondents at AI high performers most often point to models and tools, such as monitoring model performance in production and retraining models as needed over time, as their top challenge. By comparison, other respondents cite strategy issues, such as setting a clearly defined AI vision that is linked with business value or finding sufficient resources.

The findings offer further evidence that even high performers haven’t mastered best practices regarding AI adoption, such as machine-learning-operations (MLOps) approaches, though they are much more likely than others to do so. For example, just 35 percent of respondents at AI high performers report that where possible, their organizations assemble existing components, rather than reinvent them, but that’s a much larger share than the 19 percent of respondents from other organizations who report that practice.

Many specialized MLOps technologies and practices  may be needed to adopt some of the more transformative uses cases that gen AI applications can deliver—and do so as safely as possible. Live-model operations is one such area, where monitoring systems and setting up instant alerts to enable rapid issue resolution can keep gen AI systems in check. High performers stand out in this respect but have room to grow: one-quarter of respondents from these organizations say their entire system is monitored and equipped with instant alerts, compared with just 12 percent of other respondents.

3. AI-related talent needs shift, and AI’s workforce effects are expected to be substantial

Our latest survey results show changes in the roles that organizations are filling to support their AI ambitions. In the past year, organizations using AI most often hired data engineers, machine learning engineers, and Al data scientists—all roles that respondents commonly reported hiring in the previous survey. But a much smaller share of respondents report hiring AI-related-software engineers—the most-hired role last year—than in the previous survey (28 percent in the latest survey, down from 39 percent). Roles in prompt engineering have recently emerged, as the need for that skill set rises alongside gen AI adoption, with 7 percent of respondents whose organizations have adopted AI reporting those hires in the past year.

The findings suggest that hiring for AI-related roles remains a challenge but has become somewhat easier over the past year, which could reflect the spate of layoffs at technology companies from late 2022 through the first half of 2023. Smaller shares of respondents than in the previous survey report difficulty hiring for roles such as AI data scientists, data engineers, and data-visualization specialists, though responses suggest that hiring machine learning engineers and AI product owners remains as much of a challenge as in the previous year.

Looking ahead to the next three years, respondents predict that the adoption of AI will reshape many roles in the workforce. Generally, they expect more employees to be reskilled than to be separated. Nearly four in ten respondents reporting AI adoption expect more than 20 percent of their companies’ workforces will be reskilled, whereas 8 percent of respondents say the size of their workforces will decrease by more than 20 percent.

Looking specifically at gen AI’s predicted impact, service operations is the only function in which most respondents expect to see a decrease in workforce size at their organizations. This finding generally aligns with what our recent research  suggests: while the emergence of gen AI increased our estimate of the percentage of worker activities that could be automated (60 to 70 percent, up from 50 percent), this doesn’t necessarily translate into the automation of an entire role.

AI high performers are expected to conduct much higher levels of reskilling than other companies are. Respondents at these organizations are over three times more likely than others to say their organizations will reskill more than 30 percent of their workforces over the next three years as a result of AI adoption.

4. With all eyes on gen AI, AI adoption and impact remain steady

While the use of gen AI tools is spreading rapidly, the survey data doesn’t show that these newer tools are propelling organizations’ overall AI adoption. The share of organizations that have adopted AI overall remains steady, at least for the moment, with 55 percent of respondents reporting that their organizations have adopted AI. Less than a third of respondents continue to say that their organizations have adopted AI in more than one business function, suggesting that AI use remains limited in scope. Product and service development and service operations continue to be the two business functions in which respondents most often report AI adoption, as was true in the previous four surveys. And overall, just 23 percent of respondents say at least 5 percent of their organizations’ EBIT last year was attributable to their use of AI—essentially flat with the previous survey—suggesting there is much more room to capture value.

Organizations continue to see returns in the business areas in which they are using AI, and they plan to increase investment in the years ahead. We see a majority of respondents reporting AI-related revenue increases within each business function using AI. And looking ahead, more than two-thirds expect their organizations to increase their AI investment over the next three years.

The online survey was in the field April 11 to 21, 2023, and garnered responses from 1,684 participants representing the full range of regions, industries, company sizes, functional specialties, and tenures. Of those respondents, 913 said their organizations had adopted AI in at least one function and were asked questions about their organizations’ AI use. To adjust for differences in response rates, the data are weighted by the contribution of each respondent’s nation to global GDP.

The survey content and analysis were developed by Michael Chui , a partner at the McKinsey Global Institute and a partner in McKinsey’s Bay Area office, where Lareina Yee is a senior partner; Bryce Hall , an associate partner in the Washington, DC, office; and senior partners Alex Singla and Alexander Sukharevsky , global leaders of QuantumBlack, AI by McKinsey, based in the Chicago and London offices, respectively.

They wish to thank Shivani Gupta, Abhisek Jena, Begum Ortaoglu, Barr Seitz, and Li Zhang for their contributions to this work.

This article was edited by Heather Hanselman, an editor in the Atlanta office.

Explore a career with us

Related articles.

The economic potential of generative AI: The next productivity frontier

What is generative AI?

Exploring opportunities in the generative AI value chain

Here's what to do if you've missed out on the massive 54% stock market rally since October 2022

• With $7 trillion in money market funds, many investors have been on the sidelines amid a massive stock rally.
• Fears of a recession and Fed rate hikes kept many from buying stocks over the past year.
• Investors need to embrace volatility if they want to succeed in the long-term, according to John Lloyd of Janus Henderson.

It's been almost a year since the Federal Reserve made its last interest rate hike on July 27, 2023, and with a record $7 trillion sitting in money market funds, it's safe to say that a good chunk of investors have missed out on the stock market rally since then.

Fears of a recession and uncertainty surrounding the Fed's fastest monetary tightening regime in history kept many investors fearful about the potential for a repeat of the 2022 bear market.

Yet, the S&P 500 is up 17% since then, and its bull rally has extended to a 54% gain since the October 2022 low.

If you've missed the bulk of the stock market rally, there are two things you can do to improve your chances of success going forward, according to a recent note from Janus Henderson portfolio manager John Lloyd.

Embrace volatility

To be a successful investor, accept a healthy dose of risk, uncertainty, and outright pain as stocks seesaw from gains to losses.

One of the biggest mistakes an investor can make is tinkering with their investment allocation as a knee-jerk reaction to the ups and downs of the stock market, rather than sticking to a long-term plan.

That's why if you missed out on the stock market rally, going forward its crucial to embrace the uncertainty.

"The future is inherently unknowable, and even if one could correctly predict what will happen, knowing how or when it will happen remains obscure. That's why it is necessary to make peace with the reality that the upcoming year might be a good year, a bad year, or something in between," Lloyd said.

What's more, sitting in cash on the sidelines is incredibly taxing on investor psychology, and it could create more problems down the road.

"Sitting on the sidelines places investors in a position where they are frustrated by good news, and might even hope for bad news so markets will decline. In this way they are like farmers who have decided not to plant hoping for a severe drought to prove themselves right. This upside-down incentive system can be extremely taxing on an investor's psyche, as each blip in the market makes one agonize over one's position," Lloyd said.

So, if you're still sitting on cash and not investing, hoping to put your money to work during the next stock market decline, Lloyd suggests adjusting your mindset to "embrace the uncertainty of the future."

"They can take action by reviewing their financial goals with their financial professional and seeking to rebalance their target asset allocation to align with their long-term goals," Lloyd said.

Buy assets that haven't rallied

Just because the S&P 500 has surged over the past year doesn't mean that there aren't great bargains still out there.

Lloyd highlighted core US fixed income as an asset class still suffering from a painful bear market and has yet to recover due to elevated interest rates.

That means bonds can see a big rally if and when interest rates begin to fall.

"In our view, the conditions for bonds to outperform are firmly in place and rates have not yet moved to reflect that, creating opportunity for investors," Lloyd said.

The Fed is expected to begin cutting interest rates in September.

"At any given time, the future may look bright and hopeful or dark and ominous. It might even look like all those things at once, just to different people. Regardless of their personal outlook, we believe investors should accept that the future is unknowable, and yet remain committed to their investing journey," Lloyd concluded.

• Main content