Positioning is the strategic placement of a company or brand in a clearly desired position measured against that of the brand's competitors. Positioning as part of the luxury branding mix is different from brand positioning already discussed in this chapter, which is a source of brand equity and brand value. In this context, Positioning refers to the choices that a brand makes, which determines where and how it competes in its market. In the consumer goods category, this would mean defining and targeting a specific or several market segments, which would act as a guide in designing other elements such as pricing and product features.
Positioning on this level deals mostly with products, services and pricing. Since luxury brands have a clearly defined and highly specific market, the positioning strategy serves mostly as a strategic tool for external competitor intelligence and sector benchmarking. It is also a guide for evaluating internal product decisions such as product extensions and diversification.
Positioning is applied through positioning maps. This could be done internally through mapping products and services together on a positioning map. It allows the products to be compared and contrasted in relation to one other and those of competitors. On the external level, positioning could be done through using market indicator factors such as appeal and pricing as labels for the positioning map. The most feasible competitive position, which enables a brand to distinguish their own products from the offerings of their competition is then selected and executed.
In the development of positioning maps, two or multiple axes are used depending on the length and breadth of the brand's portfolio. After determining the number of axes, they are labelled with relevant factor indicators. These factors could be represented through 'pricing' as one variable and 'quality' as another variable. Other possible labels include 'design' as one variable and 'image' as another. The individual products are then mapped out next to each other and gaps are usually identified at this stage. These gaps could be regarded as possible areas for new products or product re-launches. An example of a positioning map is shown in Figure 5.24.
It is highly essential for luxury brands with low market awareness to have a well-crafted positioning in terms of product, services and branding. This is one of the fastest routes of appropriate placement in the market. The Tom Ford brand can be used to illustrate the dimensions of positioning. Tom Ford, the former Creative Director of Gucci has recently launched two products. The first is an eyewear range branded Tom Ford Eyewear and the second is a fragrance and cosmetics co-branding venture with Estee Lauder branded the Tom Ford Estee Lauder Collection. Since Tom Ford is a household personality in the luxury fashion arena with a clear image that needs no introduction, the recognition level of products associated with his name is likely to be high. However, on the branding sphere, there is some message disparity regarding
the simultaneous brand launch of the Tom Ford brand and its co-branding venture with Estee Lauder. It is important for consumers to understand from the onset whether Tom Ford is a new luxury brand or a co-brand of Estee Lauder. If it is a new luxury brand, what is its product range? Where is its market and which consumers does the brand target? What is its identity and positioning? These questions need to be clarified for consumers as co-branding is a strategic move that requires clarity with consumers. However, the strategy that Tom Ford adopts ought to be clear and understandable to consumers from the moment the brand is introduced in the market.
The Positioning of luxury brands is important for competitive leverage. It should also incorporate research and benchmarking, with the objective of creating value for consumers.
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