Market Positioning
Introduction
Market positioning is a marketing strategy that seeks to influence consumer's perception of a given brand or product in relation to other competing commodities in the market. Many scholars view this marketing strategy as the process of creating an image or product identity in the minds of consumers to influence the way they (customers) perceive products in the target market (Blankson et al., 2013, p. 500). Market positioning must be maintained throughout the entire life of a given product/brand, and for firms to achieve this objective, they must understand the key market segments that they want to serve (Bock and Styles, 2002, p. 17). Therefore, the process requires ongoing marketing initiatives that strive to establish strong perceptions of consumers towards a given product in a market.
In the luxury car industry, purchase decisions of a customer are mainly influenced by the perceptions that the customer has towards a given brand and product in the market. The position of a brand indicates the place of the product in the minds of consumers relative to the company’s competitors. One of the aspects that make brand positioning an important attribute concerning luxury cars is vast competition and the fact that the market consists of products that are well established. Companies in the industry have to create a strong brand identity, thereby making their products perceived as superior to other competing products (Paharia, Avery & Keinan, 2014, p. 650). This paper explains the significance of market positioning as part of marketing strategy in the luxury car industry.
Main Body
Luxury cars are rare and limited to a few individuals in the society, an aspect that makes them desirable. For instance, the high cost of Lexus makes these cars to be obtained by a small group of customers in the market. Another attribute that makes luxury cars desirable is excellence, and this attribute should be consistent. People are attracted to purchasing luxury cars because of their excellent performance, and this attribute makes them unique in the market. Another characteristic of luxury cars is expensiveness although not all expensive products are luxurious. This attribute intensifies rarity of a product, giving products unique attachment to the target customers.
Luxury cars are considered timeless as they create a lasting impression acknowledged throughout the lives of their users. Luxury cars are tailored to meet the needs of the target customers by embracing unique designs. Manufacturers of luxury cars have to understand their customers and their needs so that they can produce products that uniquely meet the needs of their customers. Luxury cars give their users pleasure as they tend to indicate the status of power which is adored by many in the society. In short, the luxury car industry is very competitive and is composed of five major companies, which have significant shares in the market. The companies are Lexus, Audi, Merzedes-Benz, Volvo and BMW. However, of five companies, only BMW and Audi compete on a global scale.
Brand positioning is an important marketing strategy, and it indicates the way customers view products in their minds. The developed position is accomplished to offer companies a competitive edge in the market and needs to be communicated to customers (Hui-Ju, 2015, no pagination). Different automobile industries embrace various strategies to build a strong position in the market, and this acts as an efficient approach used in meeting the needs of their target market. However, organizations can consider engaging in market re-positioning if they feel that there is the need to change consumer perceptions of a given brand. For instance, Ford is a company that has successfully repositioned itself in the market as a mid-level family car, an aspect that has contributed to its success.
However, to remain competitive in the market, companies have to avoid brand drift, as this issue makes products to change attention from the intended location. Brand drift contributes to increased confusion among customers as they are not sure of the product position in the market. Brand position has a significant influence on decision making, hence influence the purchasing behavior of consumers in the market (Fuchs and Diamantopoulos, 2010). It is for this reason that firms have to embrace brand protection to avoid being displaced in the market.
Achieving Positioning Objective
Luxury cars embrace different strategies to position themselves in the market so they can exploit various market opportunities. The first strategy is going against their competitors, and this strategy requires introducing products with distinct features that meet specific needs of their target customers. The luxury car companies can also consider positioning themselves in opposite market of their competitors to reduce competition. As evidenced, different luxury cars possess unique attributes that companies can use to position their cars in the market by specifying various benefits that they offer to their target market. For instance, Volvo is known to offer its customers safety while BMW is recognized for its sheer driving experience. Furthermore, luxury cars can position themselves in the market by focusing on the unique characteristics of their target market. Therefore, different companies use different strategies in achieving the positioning objective, an aspect that influences their success in the market.
Importance and limitations of brand positioning
Positioning a product is a critical decision for companies, especially when venturing into a new market, and dictates the marketing strategy that a particular firm utilizes. With luxury cars, positioning is based on the distinct attributes of different brands, an aspect that helps companies to differentiate their products from the rest. Failure to hold a firm position in the minds of people might make the products of a company not be in a position to attract potential customers in the market.
For a product to receive appreciation from different stakeholders, it should be placed in a position that it receives maximum attention from various customers. Positioning creates an image of the product in the minds of people, an aspect that influences purchasing behavior of the individuals (Shakhshir, 2014). In the luxury car industry, positioning is used as a valuable tool to foster business promotion and marketing, and this attribute has a huge impact on business performance. The luxury car industry faces a lot of competition, and for different organizations in the industry to remain competitive, they need to embrace brand positioning. Moreover, firms can utilize positioning strategy to exploit existing opportunities in the market, hence capitalizing on the areas of weakness of the competitors. Brand positioning strategy differs from one product to another as each business is dictated by different opportunities. A strong position has a huge influence on consumer perception, making people believe that luxury cars have unique attributes.
Positioning associates luxury cars with specific benefits that their target market desire, hence a significant strategy through which the specific needs can be met. This strategy is therefore used as a vital platform of informing consumers on the key benefits of the product to attract their attention. Brand positioning as evaluated by different scholars influences the perception of consumers in different ways, hence affecting their purchasing behavior (Kobuszewski Volles & Hoeltgebaum, 2016, p. 200). Marketers use brand positioning to inform their customers on different attributes, a feature that makes them gain consumer loyalty.
Positioning is subject to different challenges, and this makes it difficult for companies to achieve their objectives. Firms incur huge costs in marketing their products so that they can gain a competitive position in the market and the process of positioning is undertaken in a consistent manner to avoid creation of wrong impressions in the minds of other people. Brand positioning is useful only if a product has a good reputation in the market as wrong perception can destroy the brand image, an aspect that can cost a firm significantly (Meyvis, Goldsmith, & Dhar, 2012). Therefore, if businesses fail to create proper product positioning, they might incur huge losses due to the wrong perception that is developed by people.
The Influence of Competitive Dynamics to the Element
Market positioning is a primary marketing decision that is engaged by any firm that ventures into a new market and involves product differentiation to ensure that consumer needs are adequately met. Market positioning is a primary marketing decision that any firm with the aim of entering new market utilizes, and involves product differentiation, thereby attracting different customers and meeting their needs adequately. Marketers need to convince customers to purchase their products by indicating some of the significant benefits that their products have in the market relative to those of competitors (Grădinaru, Toma & Marinescu, 2016, p. 311). Moreover, different scholars indicate that positioning plays significant roles in the market, as it shows what markets want to achieve. The concept helps firms to predict the actions of competitors in the market, thereby helping them in effective planning to gain competitive positions in the market. Furthermore, positioning has significant impacts on customer’s purchasing decisions, as it manipulates customer’s perceptions towards given products in the market.
Coordination of market positioning with other elements in the strategic marketing process
Coordination
The luxury car industry is characterized by a unique marketing mix, which composes of product, price, promotion and place. The marketing mix for the luxury car industry reflects different strategies that various companies in this industry use to engage their target markets.
Product
Luxury cars have distinct features in the market, and they are based on enhanced innovation and product development. Each company produces luxury cars with unique characteristics that distinguish them from the rest (Bhasin, 2016a). For instance, in the recent past, BMW has engaged in the production of small cars that embrace an innovative structure that is admired by different stakeholders. Different companies strive on producing new innovative cars to gain competitive advantages in the market. The product line for the luxury cars includes BMW, Lexus, Audi, Mercedes-Benz and Volvo, with Lexus and Audi being the most famous globally. The products are tailored to meet specific needs of target customers, an indication that firms producing these cars target a wider market.
Price
With luxury cars, pricing is done based on different strategies, and this activity charges extra cost because of the premium quality of these cars. The pricing is different because the vehicles have different features that uniquely identify them in the market. BMW employs premium-tization that is known to enhance polarization in the respective markets, a strategy that makes consumers pay more for the cars because of their perceived benefits.
Promotion
Because of the competitive nature of the luxury car industry, different cars companies use different slogans and advertisement to establish their products in the market. Various advertisement techniques, therefore, help companies to position their luxury cars in the market (Bhasin, 2016b). For instance, BMW is advertised by its slogan “Sheer Driving Pleasure” which is an ideal strategy to the brand.
Place
Companies producing luxury cars engage with different dealers located in various parts of the globe to help in selling their vehicles. The dealers participate in the sale of both new and used vehicles, spare parts and provision of sales services. Another strategy used companies to distribute products is the use of retailers such as auto supply stores although most sales are achieved through dealership.
Conclusion
The luxury car industry is faced with a lot of competition, and market positioning as part of marketing strategy has significant impacts on the operations of the industry. Market positioning, as evidenced by this study, is perceived as the process of creating appealing images in the minds of consumers, making customers perceive a company’s products differently from competitors. The concept, if well utilized, gives companies competitive advantages, an aspect that positions a particular brand or product well in the market. For example, the paper evaluates different luxury cars and how they are positioned in the market, with the aim of attracting more customers now and in the future. The study appreciates market positioning for its significant roles in the industry, but recommends that for effective management of the product positioning in the market, the entire marketing (which comprises of the 4 Ps) has to be embraced.
References
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