1. Market mapping – what does this mean?
Key topic
Market mapping – what does this mean?

2. Market Positioning links closely with:
Marketing Strategy
Niche & Mass Markets
Competitiveness
Market Research
Marketing Mix
Adding Value

3. How Businesses Use Marketing to Create Value for Customers
1. Choose which customers to serve
Market segmentation (parts of a market)
Targeting (segments to enter)
2. Decide how to serve those customers
Product differentiation (what makes it different from the competition)
Marketing positioning (how customers perceive the product)

4. The Marketing (Positioning) Map
A market (or positioning) map illustrates the range of “positions” that a product can take in a market based on two dimensions that are important to customers

5. Some possible “dimensions” of a market map
Low price
High price
Basic quality
High quality
Low volume
High volume
Necessity
Luxury
Light
Heavy
Simple
Complex
Unhealthy
Healthy
Low-tech
Hi-tech

6. Example of a Market (Positioning) Map
High Quality
Low Quality
High Price
Low Price

7. Draw your own for a market of your choice

8. Market Mapping Helps to spot a gap in the market
Pros
Cons
Helps to spot a gap in the market
Useful for analysing what competing companies are doing
Encourages companies to carry out more market research
Very subjective – consumers have different perceptions
Just because there is a gap in the market it doesn’t guarantee success
Also just because there is a gap in the market there may be no demand.

9. Positioning & Competitive Advantage
Customers choose products based on the value proposition
Providing superior value than the competition is a source of competitive advantage (if it can be sustained)
There are various possible value differences which can deliver competitive advantage

10. Product Differentiation
Product differentiation arises when customers perceive a distinct difference between your product and the alternatives provided by competitors

11. Purpose of Product Differentiation
Positioning v Competition
Source of competitive advantage
Ideally hard to copy
Protect and Build a Brand
Build intangible value
Strengthen customer loyalty
Add More Value
Strong differentiation should allow a higher price
Higher profit margins

12. Product Differentiation by Offering a Unique Selling Point (“USP”)
A source of competitive advantage
Helps make demand more price inelastic
Should lead to higher profits
USP = something that sets a product apart from its competitors in the eyes of customers, both new and existing

13. Requirements for Effective Product Differentiation
What do we think?

14. Examples of Highly Differentiated Products (1)
Fairy Liquid
60% Market Share in the UK
Trusted household brand for 120 years
Key point of differentiation:
“It lasts longer…”
Premier Inn
UK’s largest hotels business
Targets 75,000 rooms by 2018
Key point of differentiation:
“A great night’s sleep - guaranteed”

15. Examples of Highly Differentiated Products (2)
John Lewis / Waitrose
Both in top 10 for UK customer satisfaction
Key point of differentiation:
“The partnership difference” – i.e. people
First Direct
The UK’s first – and most recommended online & telephone bank
Key point of differentiation:
Banking satisfaction guaranteed

16. Why is differentiation important?