Second Article Review: Positioning

Article Title: Positioning Your Product


Authors: David A. Aaker & J. Gary Shansby (May-June1982)


Article: Business Horizons, Vol. 25, Issue 3, Page 56-62


Review and Comments
“Positioning decision” is defined by David A. Aaker and J. Gary Shansby (1982) as “selecting those associations which are to built upon and emphasized” (pg. 56). This decision is very important because it related to customers’ perception and their choice decision on company or product brand.


In this article, David A. Aaker et al. (1982) discussed six (6) types of positioning strategies.
1. Positioning by attribute
“….is associating a product with an attribute, a product feature, or customer benefit” (David A. Aaker et al., 1982, pg.57). An example is given in this article, BMW focused on handling and engineering efficiency and therefore position itself as “the ultimate driving machine”. However, positioning strategy that emphasized on too many attributes will create a blur and confused image.


2. Positioning by price/quality
This approach is the most common and useful positioning strategy. However, David A. Aaker et al. (1982) felt that they should be used separately. This is because mostly of the customer think that product which has higher quality would not offer in lower price.


3. Positioning with respect to use or application
“….is associating the product with a use or application” (David A. Aaker et al., 1982, pg.57). It positioned as when and why we should use that particular product. The example given by authors is “Quaker Oats has attempted to position a breakfast food product as a natural whole-grain ingredient for recipes” (David A. Aaker et al., 1982, pg.57).


4. Positioning by product user
“….is associating a product with a user or a class of users” (David A. Aaker et al., 1982, pg.57). So, many cosmetic companies use a model to position their product. In context of Malaysia, SK II is one of the example.


5. Positioning with respect to a product class
This strategy is to differentiate our product from the present product-class in market. For example, some margarines position themselves with respect to butter.


6. Positioning with respect to a competitor
By utilize the prominent competitor, it’s easier for us to communicate with the public. For instance, it is easier to position our company by saying, it is next to Jaya Jusco rather than we mention the detail of the location, the street.


Besides these six approaches of positioning strategies, the process of developing a positioning strategy is also very important. Thus, there are six (6) steps in this process.
1. Identify the competitors
We can do this by determine which brand that our target market consider. In short, let our target market tells you who is our competitor instead of researching ourselves.


2. Determine how the competitors are perceived and evaluated
This is to determine the product attributes product group users and use contexts by target market.


3. Determine the competitors’ positions
This is to identify how competitors are positioned with respect to the product association.


4. Analyzing the customer
“A basic understanding of the customer and how the market is segmented will help in selecting a positioning strategy” (David A. Aaker et al., 1982, pg.59). Again, benefit segmentation as I mentioned earlier in my first journal review, is consider as important. Benefit segmentation emphasize on the product’s benefit that customer perceived it as important. For example as mentioned by the authors, toothpaste could be divided into decay preventative segment, fresh breath segment, price segment and etc.


5. Making the positioning decision
This step is crucial to avoid from being something that we are not as this will spoilt the whole positioning process.


6. Monitoring the position
Monitoring is to evaluate the successfulness of the present positioning strategy and also to generate information for future positioning decision.


To conclude, positioning needs to consider on our target market, product attributes, our competitors and so on. Different product also needs different positioning strategy.

First Journal Review: Target Market

Journal Title:

Benefit Segmentation by factor analysis: an improved method of targeting
customers for financial services

Authors: Raj Singh Minhas, Everett M. Jacobs (1996)


Journal: International Journal of Bank Marketing, Issue 3, Volume 14, Page 3-13


Review and Comments

As we know that, market segmentation could be done by three ways which are geographic, demographic, socio-economic and psychographic characteristics in order to reach the target market. However in this research, it stated that these ways are very poor to predict the future buying behavior especially in marketing financial services. So, this paper used benefit segmentation to reach their target market.


Before we go further, let me introduce some definitions of these traditional segmentation methods that given in this paper.
(a) Geographic segmentation
Definition: Dividing the market into different geographical units such as local town,
region or country as a whole. (Raj Singh Minhas et al., 1996)


(b) Demographic and socio-economic segmentation
Definition: Based on age, sex, marital status, income, occupation, education, religion,
social class. (Raj Singh Minhas et al., 1996)


(c) Psychographic segmentation
Definition: Based on social class, lifestyle, or personality variables. (Raj Singh Minhas et al., 1996)


Due to the increasingly uses of new technology in marketing, market segmentation for the banks should not only depends on the traditional segmentation methods (Anderson et al., 1976). So, Haley (1968) has introduced “benefit segmentation”, which segments the customers according to the benefits they seek when purchasing a product or service. According to Raj Singh Minhas et al. (1996), “these factors have a causal relationship to future purchase behavior” (pg.4). In a nutshell, benefit segmentation is said to be a form of behavioral segmentation.


Benefit segmentation is used because the benefit that people seek is the basic reason for purchase and then form the proper basis for market segmentation (Assael, 1995; Haley, 1968). I agree to this because I personally buy a product/service because of the benefit it could give. However, we should understand the real benefit that consumer looking for to avoid failure in market segmentation.


Besides, benefit segmentation is used for four (4) main purposes as follow:
(a) to develop new products;
(b) to reposition old products;
(c) to discontinue old products
(d) to facilitate two-way communication process between consumes and the company


In order to implement this segmentation, Raj Singh Minhas et al. have identified eight (8) benefits that are usually seeking by financial service customer.
1. Accessible Cash function
2. Money Management function
3. Personal Services function
4. Cash Card function
5. Full Banking Service function
6. Advice function
7. Investment function
8. Limited Banking Service function


Questionnaires are given to respondents and result showed that financial service customer usually looking for the third benefit which is the “Personal Service” function. Besides, benefit 7 and 8, which are “Investment” function and “Limited Banking Service” function also some of the benefit that customer looking for.


So, banks for financial institutions should concentrate on developing these functions in order to segment and reach their target market.


I think that researchers still have a lot of chances to research in different categories of products/services by using benefit segmentation method. This is because different categories of products/services have different benefits that customers seeking. In my opinion, the benefit that we are looking for in a particular product/service is the need of customers. So, benefit segmentation would lead us to understand about customers’ need and thus these benefits would be the proper appeals to the customers.

About Winnie Lau

Name : Lau Wai Nee

Nickname : Winnie

Town : Ipoh, Perak

Date of Birth : 13 September 1986

Horoscope : Virgo

Marital Status : In a relationship

Hobbies : Singing, Teaching, Completing SODOKU, Traveling, Drawing

Activities In Secondary School:

-Assistant Editor of school magazine (SMJK Yuk Choy)

-Treasurer of Chinese Language Society

-Captain of Yellow House

-Committee of Girl Guide

Working Experiences:

-Tutor, Pusat Bimbingan Pelangi, Ipoh (May-July 2008)

-Convincing Clerk, Rusnah Loh & Ng, Ipoh (April 2006-June 2006)

-Front Office Assistant, First World Hotel (December 2005-April 2006)

-Private Tuition Teacher (2004-2005)

-Tuition Teacher, Pusat Prestasi Maju (2003)

What have I done during these 2 years in university?

During these 2 years in Northern University, I joined actively in Acad U, a society under Soka Gakkai Malaysia (SGM). SGM is a Buddhist association that promotes peace, culture and education through personal change and social contribution. For more information, please log on to http://www.sgm.org.my/.

I gained a lot of experiences in this society. In the past 2 years, I take part in two exhibitions which held in this university. One of them is ‘Gandhi, King and Ikeda’ exhibition. I took part as narrator in this exhibition. My responsibility is to explain to people about this three prominent peace maker. Another one which held on last year is the ‘Transforming the Human Spirit: From the Culture of Violent to The Culture of Peace’ exhibition. I handled a few parts in this exhibition, from planning, preparation until the implementation of this exhibition. For instances, the people-in-charge of PA system, narrator and also tour guide.

I joined those activities, hoping that I would learn something new from there and thus these knowledge would be my valuable assets to succeed in my life.