Division of Research Graduate School of Business Administration The University of Michigan PRODUCT POSITIONING BY USE OF SURROGATES: A GROWNING PRACTICE AND A WIDE RANGE OF OPTIONS Working Paper No. 428 C. Merle Crawford FOR DISCUSSION PURPOSES ONLY None of this material is to be quoted or reproduced without the expressed permission of the Division of Research. May 1985

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PRODUCT POSITIONING BY USE OF SURROGATES A Growing Practice and A Wide Range of Options In 1969 Al Ries and Jack Trout put into print an idea they had been thinking about -for some time, and it caught on immediately. The concept of Product Positioning had arrived. Product Positioning (normally shortened to just positioning) is a marketing tool which addresses the question, how is one product different from others. How is it "positioned" relative to the products we know? Though product positioning fits the new product situation best, it also applies to established products. Sometimes the term is used to describe the marketing activity of putting a product in a position, and other times to describe where each product is in consumer and business minds. Here we are interested in the management, not the market research, view - how firms position their products in advertising and other marketing activity. Target buyers may or may not agree on the positionings intended. Without naming the process, some advertisers had been positioning their products for a long time. Readers may recall Bon Ami 's long-time claim of "Hasn"t scratched yet" or Pepsi's "Twice as much, for a nickle too." These approaches used product features and benefits -- called attribute positionings. But the new thinking of Ries and Trout, as elaborated by others after their articles appeared, differed significantly. First, every product or service should be positioned -- positioning isn't just a strategic option. Second, all aspects of the product's presentation to the market should be coordinated behind one positioning.. advertising, pricing, packaging, service, distribution, etc. Third, 1

the positioning needn't be on attributes, directly, but could also be indirect -- e.g. the fact that Avis was No. 2 and thus tried harder didn't clarify exactly how the attributes of their service differed; readers could draw any conclusions they desired. Fourth, the primary positioning base was market share sales rank. Every product was first., second, third, or whatever. The human mind had pigeon holes for each market's top 'few products; producers fought for places in those holes. The pigeon hole idea has long since been abandoned by marketers, but the rest of the new concept has grown and become accepted as standard in marketing strategy today. The idea is to select a market target (segment, niche) and for that group of users present a positioning which clarifies how this product is better 'for them than are the others for them. The entire marketing program is then built around that statement. The positioning is meant to be long-lasting, not seasonal or annual. In marketing literature and practice today there are five options commonly cited as available to a marketer who wants to position a product: 1. Position to an ATTRIBUTE -- Marlboro 25:'s "Have five more cigarettes to the pack.," or TWA:'s "Business class seats make the others obsolete." 2. Position to a PRODUCT CATEGORY -- though never a serious consideration, Diet Coke could have been positioned as a dietetic food. Swift's bacon could be positioned as a packaged meat, a breakfast -food, or a salad ingredient. 3. Position to a particular USE -- Troy-Bilt has a garden tiller which is designed for small gardens.

4. Position to a particular USER -- Purina's Fit &k: Trim is "especially designed for older dogs." 5. Position against a particular COMPETITOR -- the classic here is Savin's entry into the copier market with the claim that it was the same as Xerox, only cheaper. Positioning settled into a routine, and by the end of the 1970s it was rarely the topic of marketing and advertising articles. Marketing researchers continued actively developing new techniques to measure and analyze it, particularly perceptual mapping approaches, but managers appeared to have mastered it. The fact is, there were several problems: 1. Casual observation of advertising indicated that the above range of positioning alternatives did not cover everything being done in the market place. 2. There was no empirical summary of current practice -- how popular were the different approaches? 3. There were strategic questions -- e.g. is it best to position a new product on clear and precise attributes or indirectly such as to a particular competitor? When should one re-position a product? Does the entry of a new product offer re-positioning opportunities? Can one actually re-position a competitor against his will? And so on. The subject is not dead as a question of marketing strategy. 4. There seem to be conditions where positioning is not a viable marketing tool. For example, in markets (such as computers) where there is a high rate of technical innovation, sellers primarily communicate specific features, sometimes in long lists. As

another example, where personal selling is the only marketing tool used, there is less need for positioning as a device to draw multiple tools into harmony. This led to the obvious need for some empirical data, as a start. What positioning is actually being done -- that is, what are the options'? Is the technique as widely used as commonly thought? Is it useful in industrial and service markets, and if so, how does practice there differ from that with consumer packaged goods'? Do most firms stick to traditional attribute positioning or do most use more indirect methods such as Try Harder? How often is advertising.positioning backed up by action on the other marketing tools? This article presents data f:rom two of several studies undertaken to answer some of those questions. There is much more to learn, but at least we now have an empirical base. RESEARCH METHOD How does one best gather data on how products are positioned'? Presumably by surveying the marketers who position them. This is literally impossible on a broad scale - partly because of the usual nonresponse problem in surveys, but also because of frequent organization changes, confidentiality, and time. On the matter of reaction to new competitors, who could tell how a firm changed positioning three years ago? Besides, one can argue that the way a product is actually positioned is more meaningful than the way the marketers intended it to be positioned. Thus, narrowing research alternatives led eventually to using advertising as a measurement tool. Positioning began as a concept in advertising; any overall positioning should be implemented in adver 4

tising if the tool is being used deliberately; for advertising there is no nonresponse error and no hunting of previous personnel. Specifically, we did the following: 1. Selected the following magazines: GOOD HOUSEKEEPING: The homemaker (50 product cases) TIME: General interest, consumer and business (50) READERS DIGEST: General interest (50) FORTUNE: Business (50) PEOPLE: General interest, current events (50) PC: Special interest, technical (25) SPORTS ILLUSTRATED: Sports interests (25) LIFE: General Interest (25) COSMOPOLITAN: Special interest. women (25) 2. For each magazine, we selected a mid-February 1985, issue, began with the inside front cover and tabulated each advertisement in the magazine until the quota number of brands was found (quotas in parentheses above). We excluded ads which were company image (this is a study of product positioning, not company positioning), news announcements, sweepstakes, etc. The ad had to be over onehalf page. Thus, we only sought ads where there was an opportunity to position a product. In a few cases the particular magazine issue chosen did not yield the quota so we went into contiguous issues of the same magazines. 3. From each ad, the following information was gathered: * Brand of product * Company t Generic class or type of product * Whether a consumer product or a business product c Whether tangible or intangible (product or service) * The apparent positioning statement, including the primary category and the secondary category (explained later). * Supporting evidence -- whether the brand supported the positioning, whether there was packaging support, and whether there was any other evidence of support (sales promotion tools, etc.). * Whether the art work in the ad supported the positioning. - 1.2

4. An earlier set of data had been collected in essentially the same manner, using all magazines in which shampoo advertisements could be found, covering the three-year period from July 1979 to June 1982. The nature of this auxiliary study is explained more fully later. 5. The recording of the data, including scoring positioning, was personally done by the author, except for some assistance from research assistants in the longitudinal shampoo study. 6. Figure i shows a portion of the 350 brands found in the major study, as an indicator of the range and variation included here. The category totals are 73 percent consumer tvs 27 percent business, 81 percent products vs 19 percent services, and 80 percent established vs. 20 percent new. FINDIINGS Overall, the findings upon analysis were not as expected. In the first place, 26 percent of the products were apparently not positioned at all. This is strange, given that Ries and Trout first spoke out over fifteen years ago, and that the strategic technique is well established in the literature. Second, it quickly became evident in the scoring process that some positionings did not fit our original typology of options (given above). For example, Audi is presented as what you want in a car because it is well-engineered, Selectric 2000 because it came from IBM, Jacksonville, Florida because over 50 major firms have moved there in recent years, Nuprin because the major ingredient has been proven in over 250 million prescriptions before it became,r %.I

U 1 r I I I I FIGURE 1 CHARACTERISTICS OF THE SAMPLE For purposes of identifying the nature of products and firms included in this sample, here are the first 20 percent of the products, in alphabetical order. I _ __,,,, C1II II -- ---- --- Ability (software, integ.) Air Force (military service) Air-Dyne (exerciser) Allstate (insurance, bus.) Almay (makeup) Almost Home (cookies) Always (maxipad) American Airlines (air travel) American Express (credit card) American Hawaii (cruise) Amstel Light (beer) Amtrack (rail travel) Appple IIc (computer, pers.) Army (military service) AT&T (long-dist. telephone) Audi (automobile) Autry (athletic shoe) Aveeno (bath oil) Avis (car rental) Blue Cross (insurance, health) Bailey's I.C. (liqueur) Bali (bra) Barbizon (foundations) Barcardi (rum) Barclay (cigarette) BASF (video tape) Bayer (analgesic) Beefeater (gin) Bell Yellow Pages (directory) Bermuda (vacation site) Betty Crocker (cake frosting) Betty Crocker (muffin mix) BMW (automobile) Brachs (candy) Brother (typewriter) Budget (car rental) Burroughs (computer, office) B-F Crisco (cooking oil) Cadillac (automobile) Calcitrate (calcium) California (industrial location) Camaro (automobile) Camel Light (cigarette) Camels (cigarette) Campbell's (soup, canned) Campbell's LS (soup, canned) Candie's (shoes) Canon (calculator) Canon (camera) Canon (computer, personal) Canon (copier) Canon (microfilm equipment) Caravelle (automobile) Carefree (panty shields) Caress (soap) Carnation DP (diet food) Carpet Fresh (carpet freshener) Cavalier (automobile) CBN Network (cable TV) Celebrity (automobile) Chap Stick (lip balm) Cheez Whiz (cheese spread) Chevrolet (automobile) Chloraspectic (throat lozenges) CT Crunch (cereal) Citizen (printer) Civic (automobile) Coles Garlic (bread) of Total Sample: 350 Industrial 93 (27%) Consumer 285 (73%) New 69 (20%) Estab. 281 (80%) Services 66 (19%) Products 284 (81%) _ ~

available over the counter, Plaza Athenee because it is simply the best that hotel service can be. Note that these positionings, like the earlier Avis and Savin methods, do not necessarily make claims about specific product or service features and benefits. Instead, they are indirect. Moreover, we found that these newer indirect methods are much more popular than the original method of rank, and compete well with any in the list of options above. So it was necessary to develop a new typology of positioning alternatives, as derived from actual practice, on all types of products and services. The new typology is certainly not final -- other ways will be found -- but the list of typology categories does cover the activities of over 500 advertisers from several studies we have made over the past three years. THE TYPOLOBY Figure 2 shows the new typology. It has three major categories: features, benefits, and surrogates. The features classification follows tradition: a feature is some aspect of the product itself -- a characteristic, evident or hidden, usually tangible though it need not be, and not translated into how it benefits a user. The benefit may be implied, but the difference claimed is clearly feature. The benefit category is also very common; a benefit is some way in which a user gains from the product. Benefits are more vague and interpretative, and they may or may not be directly related to product features. We also found advertisers differentiating between 8

FIGURE 2 TYPOLOGY OF PRODUCT POSITIONING ALTERNATIVES PRODUCT ATTRIBUTES: Features Benefits Direct Indirect SURROGATES: Non-Pareil Endorsement Expert Emulative Parentage Rank Brand Company Person Manufacture Experience Process Other Market Ingredients Bandwagon Design Time Target Predecessor End Use Demographic Psychographic Competitor Behavioral

direct benefits which result directly from product use, and indirect benefits which result from a direct benefit. Direct benefits are such as "we save you time," "we make computers talk to each other better," and "we cut your costs." An indirect benefit would be one s eventual popularity or sex appeal stemming from more beautiful hair, or recipient's enhanced opinions of those who send Hallmark cards. Only 10 percent of the benefit positionings were indirect; although they may be powerful they are rare. The distinction between feature and benefit is sometimes difficult where a specific feature (such as low price) yields a flip-side benefit (such as low cost); fortunately., a firm's advertising usually emphasizes one or the other. An occasional problem was created by positionings on flavor and taste, which almost defy tabulation. Technically, taste must be a benefit since it doesn't come into existence until the consumer tries it, and it can be highly individual. Nevertheless; some products seem to be positioned on taste as a feature. These occasional exceptions do not distract from the overall value of the typology as a useful set of alternatives. The surrogate category also requires explanation. Surrogate means substitute -- where something substitutes for something else. This is literally what is going on in much positioning. The marketer does not describe the features/benefits, but instead says something about the product which permits the reader/listener to reach his own conc l usi ons. Note some of the traditional methods. The Troy-Bilt tiller, positioned for the small garden, apparently has features and benefits wanted by the owner of small gardens. One needn't know what is 10 O

in Fit & Trim to know that it is good for older dogs. And Savin didn't have to devote ad space to its copier's features if we knew the Xerox copier's features, as most potential Savin buyers did. The power of the technique lies partly in the reader's quick identification of features and benefits, and partly in that identification's selectivity. A person who uses Xerox because it is fast, applies fast to Savin, but another Xerox user will think of cost effectiveness, another of office acceptance. And, of course, some surrogate positionings permit readers to bring more to the product than could be claimed directly. In the area of surrogates is where this research found the most significant new practice. One can always argue with typologies, (and there may be more creative interpretations); however, we feel there are nine indirect methods in use today. In descending order, here they are. In each case, the claim would be stated as "Our product is better than or different from the others because. "" NONPAREIL: Our product is better than or different from the others because it is the top quality one. We are without equal. Some might call this the Tiffany approach. Two specific examples are the Jaguar car and the Dysan diskette. PARENTAGE:.. because of where it comes from, who makes it, who sells it, who performs it, etc. The three ways of parentage positioning, by order of popularity, are: the specific BRAND (Cadillac, or the Citizen printer), the COMPANY (the Data General/One, or Kodak diskette), and a specific PERSON (The Living Planet, a book by David Attenborough). In each case, the marketer 11

apparently feels that the product's quality can be assumed from that parentage. MANUFACTURE:... because of how the product was made. Again, there are three alternatives: PROCESS (Hunt's tomatoes are left longer on the vine, and Jack Daniel's whiskey is charcoal mellowed), INGREDIENTS (Fruit of the Loom panties of pure c:otton, or Sunlight Wesson cooking oil of pure sunflower oil), and DESIGN (Sharp typewriter with the latest electronics designed in, or Audi with engineering). Again, the manufacturing process, ingredient, or design does not directly make clear what the product"s advantages are -- they are to be presumed. TARGET:... because the product was made especially for people or firms like you. Here are the four ways of using target: END-USE (the Vector tire designed especially for use on wet roads), DEMOGRAPHIC (Republic Airlines, especially designed for the business traveller), PSYCHOGRAPHIC (Michelob Light, for "the people who want it all") and BEHAVIORAL (Hagar's Gallery line for men who work out a lot -- "fit for the fit"). RANK:.n. because it is the best selling product. Examples are Hertz and Blue Cross/Blue Shield. ENDORSEMENT:... because people whom you respect say it is good. The endorser may be an expert (e.g. the many doctors who use Preparation H) or a person to be emulated (Farah Fawcett shampoo). EXPERIENCE:... because its long or frequent use attests to its desirable attributes. There are three modes here: OTHER MARKET (Nuprin's extensive use in the prescription market), BANDWAGON (Stuart Hall"s Ex:ecutive line of business accessories are 12

the tools business professionals rely on), and TIME (Bell's Yellow Pages). COMPETI TOR: -. because it is just (or almost) like another product which you know and like. Besides Savin, there are the IBM lookalikes Compaq and Canon. Lower cost may or may not be an addendum. PREDECESSOR:..S because it is comparable (in some way) to an earlier product that you liked. Examples are Ford's current positioning of Thunderbird against its 30-year-ago classic and Hershey' s new Solitares addition to the golden line). OVERALL INCIDENCE OF USE Figure 3 shows the frequency of use four-d among the 350 products for each of the typology alternatives. Benefits, as an alternative, wins handily, as marketing theory would say it should. Some 32 percent of the positionings used one or more benefits. But surrogates as a whole came second, ahead of features. And., in fact, more (26 percent) of the products were not positioned at all than were positioned with features. Among the surrogates, most popular are nonpareil, parentage, manufacture, and target. The competitor positions, frequently talked about, runs in a tie for last. Rank, the other of the two original positionings, came in near the bottom also. The reader may note that one of the commonly recommended positioning methods (position to a product category) is not on the list. It is covered indirectly. Thus, for example, the catagory may be defined by end-use (e.g. a breakfast food), or by benefit (an anti 13

FIGURE 3 Frequency of Use of the Positioning Alternatives [ 23% - AT SURROGATES - - _ _____ ^ - - - ^ Total Cases: 350 Total Cases: 80 Manul Parentage! Nonpareil 5% Target 3% Facture 4% 5% / / | Competitor 1% Rank 1% Predecessor 1% Endorsement 1% Experience 1%

static additive), or by feature (a meat). There is no benefit in a category which duplicates others. Figure 4 shows these typology totals broken down three ways. First is a comparison between industrial products and consumer products, and the differences are surprisingly few. Not only are "no positioning" and surrogate positioning almost exactly the same, but the surrogates used differ only slightly. The most significant difference is, as might be expected, that among attribute positionings consumer marketers are much more likely to use benefits (34 percent to 23 percent), and industrials marketers features (26 percent to 16 percent). The second comparison in Figure 4 is tangible vs. intangible, essentially products vs. services. Surprisingly, perhaps, service marketers are more likely to use positioning (80 percent vs 72 percent)., but they make less use of surrogate positionings and more use of features. Among the surrogates there are interesting differences, though the numbers are small -- for example, services do not cite the popular methods of manufacture or parentage (though they could use either). Next, Figure 4 shows new products vs old products, as determined by material given in the ads or from general knowledge. Here the differences get more explicit. In the first place, 16 percent of the new products apparently were not positioned; and one can only wonder so many opted not to use so common a marketing tool. Second, new products are much more likely to use surrogates, especially those which fit new situations -- experience in other markets, predecessor products, and parentage. They cannot, of course, use rank. 15

FIGURE 4 Variations in Frequency of Use of Typology Alternatives by End Market, Tangibility and Newness No Positioning Total Cases Features Benefits Surrogates Consumer Industrial Tangible Intangible New Established Total' 16%l 34% I 24% 26% 17j i! i 3 I/ 1j +9 1H I 280 J 17% 31% 24% 28%, 28% 1!1 11'" 32% 20% 20% 25% 127% 32% 16%:18%i 33% I I 290%% 19% 32% 23% 26%,1,i...1 IIIIFII 285 93 284 66 69 281 350

New products make greater use of attribute features., as one would expect of innovators, and they do not use indirect benefits. Figure 5 shows similar breakdowns for general categories of products, though there is no attempt to report on use of various surrogates for these smaller categories. Interesting differences are suggested -- for example, the use of benefit positioning by health and appearance products, and the high rate of no positioning by cigarettes. SUPPORTIVE USE OF BRAND AND PACK1AOING We could not, of course, examine the packaging of all 350 products and services, but we did have their brand names, and many of the packages were shown in the advertising. In theory, the best positioning comes when all three agree. Thus, for example, the shampoo called Gee Your Hair Smells Terrific leaves no doubt about its positioning, though repositioning options are narrowed considerably when brand is clearly involved. On the other hand, Alberto VO-5 and Prell get little if any help from the name, but can reposition at will. Which is the more popular technique? Figure 6 shows that letting the brand name float free is by far the more popular. Only 22 percent of all positioned products had a brand name which supported the positioning -- the other 78 percent did not. Those who use surrogates were much more likely to have a brand tie-in, stemming primarily from firms which use parentage as the surrogate. In only a few instances were we able to find evidence of positioning being implemented in other promotional forms. The Hertz No i Club is an example. And rarely was there evidence that a firm 17

b FIGURE 5 Frequency of Use of Typology Alternatives by Broad Product Categories Features Benefits Surrogates No Positioning Total Cases Food, Beverage Health Personal Appearance Travel Home and Personal Business Cigarettes Business Computer Products 18% 24%0 30% 28% 17% 48% 22%/ 13% 22% | 18% 30% 30% flllh!1 IIIl4_.. i______ 16% | 36% | 24% 24% 7% 29% IitI 43% 0 ||||20111111 ||1| 111 1 29% 20% 27% 24o 29% 67 23 49 40 42 14 41

'I C~ ~'1 I ~ ~' r ~ I -L I E FIGURE 6 SUPPORTING USE OF BRAND, PACKAGING, AND ARTWORK PERCENTAGE OF CASES WHEN BRAND WAS SUPPORTIVE WHEN PACKAGING WAS SUPPORTIVE WHEN ARTWORK WAS SUPPORTIVE POSITIONING ALTERNATIVES TOTAL CASES FEATURES BENEFITS SURROGATES TOTALS 67 111 80 15% 17 35 12% 67% 15 71 11 65 258 22% 13% 68% NUMBER OF ITEMS IN PERCENTAGE 57 34 176 I, I - --, -,,,, I,, - --

used packaging to enhance its positioning beyond the brand name itself. As a final check, we noted that almost all of the advertisements had some type of art work, although in only 68 percent of the times was it used to support the positioning. Granted, art work gets deep into advertising strategy, but one must wonder how serious is positioning if the art work is not committed to it. THE LONGITINL UDINL STUDY: SHAMPOO MARKET The second study that can be reported here was a review of shampoo products in which we measured longitudinal changes in one particular market; it involved thirty-eight products which used forty-six different positionings at one time or another during a three-year period. The data were collected from over a dozen consumer magazines, everywhere that shampoo advertising appeared with sufficient frequency to warrant tabulation. The time covered was three consecutive years from July 1979, through June 1982. The purpose of the shampoo study was to look at patterns over time, to see how often positionings were changed, and to see how established products reacted to new entries, if at all. To measure longitudinally it was necessary to find a market where there were both many long-standing established brands and frequent new entries. This market had to be of products where magazine advertising played the major promotional role (to measure reactions as soon as they took place) and where the firms involved were considered fairly astute marketers. The shampoo market was one of the few that qualified, although even it has changed in the last few years as marketers have apparently shifted increasing propor 20,.I..r., r Q

tions of promotion budgets into television. For the three-year period under study we scored the product positionings according to the same typology as above, and made careful note of each new entry and the timing of all repositionings by established products. The results are shown in Figure 7. We eliminated one minor brand which apparently did not practice positioning, and nine other minor brands which had so little sustained advertising over the three years that we could not be certain of their positioning dynamics. This left fourteen brands in the market at the start of our audit. The initial positionings of those fourteen brands are shown in the left-hand column of Figure 7. However, over the course of the three years other brands entered, and some positionings were changed. As a result, there was a total of thirty-five positionings, and the distribution by type is shown near the bottom of the figure. Consistent with the across-industry data discussed earlierq. these consumer products use fewer features, many benefits, and higherthan-average surrogates. Although not shown in the chart because of the small numbers, the surrogates were principally manufacturing (particularly special ingredients) and target (particularly people with special hair problems or needs). Figure 7 also shows some interesting dynamic results. Note that nine of the original fourteen brands did not change positioning during the three years. This is determined use of the tool, widely thought to be the effective way to do it. Further, of the eleven new brands, only two changed positionings during the audit. Several brands (Prell, Vidal Sassoon, and Flex) either had 21

FIGURE 7 LONGITUDINAL PATTERN OF SHAMPOO PRODUCT POSITIONING July, 1979 through Juno, 1982 PRODUCTS 7/79 AGREE BODY ON TAP BRECK CON IR FABERGE ORGANIC FARAH FRWCETT GEE YOUR HAIR. HEAD & SHOULDERS JOHNSONS BABY PRELL SILKIENCE ULTRA MAX VIDAL SRSSOON WELLA BRLSAM 1979 J R S 0 N D B --- —------ B --- —---- B --- —------ B — - —, --.~ S --- —----- B --- —~-~ -- e~II 3 L L L 1980 JF M M JJ S N D ' — B~.... —~.B —B, --- m --- — - -m-. —m.m, --- —m. -- _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ - ______________________- F - 1981 J F M A 1 J jR S O N D _ —_ _ — _ _-_-_ ----_ _-_ — - _ --- —_ ---_ --- —-_ ----_ ---___________ m _ _ _ _ _ _ m m m m m m _ _ m _ _ _ _ _ m _ _ _ _ __I - - - - - - __5___________________________________________ - ________________________ __ __ _ __ __ __ __ __ _ __ __ _ --- _______________________ — _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __~I L _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ I C1LL~I ~ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __rI I r ~ I r 1 982 J F M R M J I _ _ _ _ _ _ _ _ _ _ _ _^ _ _^ __ _ _ _^ _^ _^ ^_ — B --- - - _ _________ _- _ - _ _- _ - _ _ _ _ __ _ _ _ _ _ _ _ _ ------------- r - - - - - - - - - - -- --- - - - - - — B I Irr NEW PRODUC:TS: FLEX F ----. ---..-. --- —. -. —.BSPRING FEELING S --- ___ --- —-------— _ — JHIRMACK S - - - - - - ------ -__ _-_ RLBERTO V05 S ------------------ STYLE II S 5 ---... --- —..-. — PERT B ------------------ FREEMAN -------------— F ---- ~ --- —------ ENHANCE HENNA JHERI REDDOING VI DRFL SASSOON FOR SENS. Hi R s ---m --- —--- S - --- m - - m m - S ---------— ~L~II II KEY: F B S POSITIONINGS FEATURES 5 (14%) BENEFITS 17 c49%) SURROGATES 135 37) TOTAL 55 POSITIONINGS BY THE 25 BRANDS

difficulty settling on an effective positioning., or their product managers saw positioning as a matter of current campaign strategy. The issue of reaction to new entries also suggests this industry's strong commitment to positioning. Over the three-year period eleven brands entered, seven of them early enough to give at least a year and a half for competitors to answer. However, only seven changes were made in the positioning of five of the original fourteen products, and four of those seven occurred after eight months, too late to indicate reaction to new entries. The fact is, for shampoos, during 1979-82, the research data we have here indicate that marketing strategy held firm -- positions were rarely changed, and only incidently to new entries. SUMMAIRY AND STRATEGIC IMPLICATIONS This study attempted to measure whether marketers of consumer and industrial goods and services make use of the concept of positioning, and if so, how they do it. The research began with a brief list of positioning options developed from past writings on the subject, but we rapidly expanded that list as practice was audited. It appears that around three-fourths of all products and services are positioned, though of course some marketing managers may attempted to position products but were ineffective. The study yielded a typology which includes two broad categories of (1) attributes (features and benefits) and (2) surrogates. A surrogate is a method of positioning a product that suggests value to the potential buyer without citing specifically what attributes yield that value or what that value is. 23 '-1. A~-o

Across the board, of the products and services which are positioned two-thirds use attributes and one-third use surrogates. There are variations in use by newness of product, by industrial vs consumer, by product vs service, and by general category of product, though not as many variations as one might have expected. The ones which appear seem to make sense, and no significant variations appear to be spurious or random. The article also reports on a second phase of the general positioning study which covered one product category (shampoos) f:or a three-year period. The data show that positionings are in most cases firmly adhered to, both over time and in the face of a steady stream of new entries. The shampoo data also support the use of surrogates to communicate attributes indirectly. There are several strategic implications from the data in these two phases of study: * The frequency of positioning would suggest its wide acceptance and probable wisdom of use. * Benefits are apparently -Felt to be more effective than features as positioning approaches. * It would be wise for marketing managers to investigate the idea of surrogate positioning, if it is not now being used. To say, for example, that "Our product is better than the others because it was developed especially for people (or firms) like you" has the strong advantage that each buyer can bring to the product the attributes he feels important. This communicates more attributes than an ad can cover effective 24

ly, and a different set for each person or firm. For products with little physical differentiation., surrogates encourage perceptual differentiation. The big danger, of course, is that some of these perceived attributes may be wrong or negative, even misconceptions. Surrogate positionings should be pre-tested carefully with the target market. * Positioning is felt to be most effective when several of the marketing tools are used in concert (e.g. when brand, packaging, and price together with advertising and personal selling say the same thing). Here we did not have access to all of those other tools, but 22 percent of the positionings were supported by brand coherence, and still others used the package to support the overall idea. * Positionings can and probably should be held to, over time and in the face of new entries. * There are far more choices available to use for positioning than previously thought. Not only did the data show two approaches to using benefits (direct and indirect) but there are now at least nine different surrogate positionings. Furthermore, the nine surrogate methods have enough subdivisions to yield a total of nineteen surrogate options alone. The range of choices is expanding and will probably continue to do so. References: 1. Ries, Al and Jack Trout (1969)5 "Positioning: A Game People Play in Today's Me-Too Marketplace," INDUSTRIAL MARKETING, 54 (June), 51-55. 25

2. Ries, Al and Jack Trout (1981), POSITIONING: THE BATTLE FOR YOUR MIND, New York: McGraw-Hill Book Co.