What is repositioning?
Repositioning where a company deliberately adjusts and modifies how its product is perceived by the target market.
The goal of repositioning is to alter the way customers view and understand the product, often to tap into a new market segment, react to market changes, or revitalize an aging product.
Why is repositioning used?
Changes in Consumer Needs and Lifestyles
As consumer preferences and lifestyles evolve, a product that was once relevant may lose its appeal, necessitating a repositioning to align with current market trends and demands.
New or Stronger Competition
When new competitors enter the market or existing ones strengthen their position, repositioning can help a product maintain its competitiveness and distinctiveness in an increasingly crowded space.
Lack of Perceived Differentiation
If consumers perceive a product as similar to others, repositioning can help establish unique points-of-difference, making it stand out in the marketplace.
Under Positioned Product
If a product’s positioning is too vague or weak, it may fail to make a significant impression on the target market, necessitating a repositioning to create a stronger, more memorable product image.
Over Positioned Product
When a product is too narrowly defined, it may exclude potential customers, and repositioning can broaden its appeal without losing its core value proposition.
Change in Macro Environment
Shifts in the broader economic, technological, or legislative environment can render a product’s current positioning obsolete, requiring an update to remain relevant and compliant.
To Support an Improved Product
When a product undergoes significant improvements or updates, repositioning can help communicate these changes to the market, highlighting the new benefits and features.
To Correct a Poor Product Launch
If a product’s launch fails to meet expectations or encounters unforeseen challenges, repositioning can serve as a strategy to reset its market presence and perception.
If a Revised Target Market is Selected
When a company decides to target a different demographic or market segment, repositioning the product can ensure it resonates with the new audience.
If the Target Market Definition is Being Broadened or Narrowed
Adjusting the scope of the target market, either by broadening to include more customers or narrowing to focus on a specific niche, can necessitate repositioning to suit these new market boundaries.
To Pursue a Significant and Uncontested Market Gap
Identifying and targeting an unexploited market gap often requires repositioning to ensure the product aligns with the unique needs and preferences of this new opportunity.
If Positioning Drift has Occurred
Over time, a product’s positioning may unintentionally shift or ‘drift’ due to various market forces, and repositioning can help realign the product with its intended market position and strategy.
Challenges and risks in repositioning
Will Lose Existing Product Sales
Repositioning may alienate current customers who are loyal to the product’s existing image and benefits, leading to a loss in sales among this established customer base.
Difficult to Change Perceptions
Altering established customer perceptions can be challenging, as people may have deep-seated views about the product that are resistant to change.
Competitors Will React
Competitors may respond aggressively to repositioning efforts, either by enhancing their own products or by launching counter-marketing campaigns.
Consumers are ‘Disinterested’ in Low-Involvement Purchases
For products that are typically low-involvement, such as everyday commodities, consumers may not notice or care about repositioning efforts, making it difficult to impact their purchasing decisions.
Can be Cost-Prohibitive (a New Brand Might be a Better Solution)
The costs associated with repositioning, such as marketing and product development, can be so high that launching a new brand might be a more financially viable option.
Takes Time and Money
Repositioning is not only costly but also time-consuming, requiring long-term investment without the guarantee of immediate returns.
Alternative options to repositioning
Instead of repositioning, companies might consider several alternatives:
Enhancing the existing product could address market changes or customer feedback without the need for full-scale repositioning.
Launch New Product (as a Replacement)
Introducing a new product could be more effective in capturing market interest, especially if the existing product is significantly outdated.
Withdraw Product (No Replacement)
In some cases, it may be more beneficial to withdraw the product from the market if it no longer aligns with the company’s strategic goals or market trends.
Do Nothing; Milk Product
A company might choose to maintain the status quo, especially if the product is in the maturity or decline stage, focusing on maximizing profits without further investment.
Improve Other Aspects of the Marketing Mix
Adjusting other elements like price, place, or promotion could rejuvenate the product without altering its core positioning.
Increase Promotional Spend
Investing more in marketing and advertising can increase product visibility and appeal, even without changing its positioning.
Discount (Sales Promotion) Product
Offering discounts or other sales promotions can temporarily boost sales and interest in the product.