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Market Positioning


What is market positioning?

Market positioning refers to the process of establishing a unique identity and image for a product or brand in the minds of target consumers, relative to its competitors. It involves identifying and emphasizing the key benefits and attributes that differentiate the product from others in the market, with the goal of creating a distinct and favorable perception among consumers.

The concept of market positioning originated in the 1960s and was introduced by Jack Trout and Al Ries in their book "Positioning: The Battle for Your Mind." It was initially focused on the idea of creating a unique position in the consumer's mind through advertising and branding efforts. Over time, the term has evolved to include a more comprehensive marketing strategy, including product design, packaging, pricing, and distribution strategies.

How to establish market positioning

In order to establish market positioning as a brand you'll need to understand and establish the following key components:

Target audience

Identify your target audience or audiences and understand their needs, preferences, and behaviors. This should be based on data, not assumptions, in order to be most accurate. You need to understand this audience in order to understand in whose minds you're looking to change or improve the perception of your brand.

Competitive analysis

Conduct thorough research on competitors to understand their strengths, weaknesses, and strategies. This will help you understand their market positioning and how they achieved it. It can also help you identify tactics to emulate and those to improve upon or ignore.

Value proposition

Develop a clear value proposition that differentiates your product or service from competitors. This may be related to something specific or unique about your product, or your brand - for example, stellar customer service or a lifetime guarantee.

Brand identity

Create a strong brand identity that aligns with the target audience's values and resonates with them. This makes market positioning easier and longer lasting.


Develop messaging that communicates your value proposition and brand values effectively to the target audience.

Benefits of effective market positioning

Implementing an effective market positioning strategy can offer numerous benefits and advantages to businesses. Some of these include:

  • Increased brand awareness and recognition

  • A long term competitive advantage

  • Improved customer loyalty and increased brand trust

  • Increased sales and revenue

  • Higher numbers of new customers


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Examples of successful market positioning

Several companies have effectively used market positioning to differentiate themselves from competitors and develop a strong brand identity in the process. For example, Volvo's market positioning strategy has always emphasized safety and reliability, which appeals to customers who prioritize this in their cars.

Challenges of using market positioning well

Implementing an effective market positioning strategy can be challenging for businesses, as it requires a deep understanding of their target audience, competitors, and market trends.

For brands and businesses operating in competitive spaces and industries it can be difficult to identify a unique value proposition that sets the product or service apart from other competitors.

Establishing strong market positioning can also demand intensive advertising and marketing resources, in order to get it in front of the right audience. This can be limiting for smaller or newer businesses. Even for larger brands, maintaining positioning as market trends and consumer preferences change can also be hard to stay on top of.


Related Term

Market Penetration

Related Term

Competitive Advantage

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