Positioning theory has been very popular in China for more than ten years, far exceeding other management theories.
If you see a brand saying that it is "the leader in so-and-so (category)", or "so-and-so (brand) is so-and-so (category)", then you can basically be sure that either this company has done positioning consulting or has participated in positioning training courses.
The advertisement for the positioning training course is as concise and clear as ever: Positioning helped Wanglaoji (Jiaduobao) grow from 100 million yuan to 20 billion yuan. This is a very convincing advertisement.
I believe that positioning theory is an effective tool to help companies build brand recognition. In consumer goods industries that mainly rely on brand recognition and have little product differentiation - such as beverages, health products, clothing, etc., positioning theory is particularly effective in accurately expressing advertising.
Positioning theory is also very simple. You can basically understand it as soon as you hear it, and you can get started quickly. There are also some successful cases, which have promoted the popularity of positioning theory.
Positioning theory has a group of loyal believers in China. They always talk about positioning and like to use positioning to comment on everything.
Not long ago, Xie Weishan commented on many well-known companies and believed that companies such as Apple, Baidu, Tencent, Huawei, Xiaomi, and Haier are not good because these companies use one brand for multiple categories, which will cause confusion in customers' mental cognition and is inconsistent with the positioning principle that brands cannot be extended across categories. Similarly, Deng Delong also said that their judgment principle is very simple, as long as it does not conform to the positioning theory, it is wrong!
If a theory cannot explain a successful practice, their first reaction is not that there is a problem with the theory, but that there is a problem with the practice. This kind of "theoretical confidence" is a bit surprising.
Deng Delong also has a more exaggerated expression. He believes that positioning is the "third productivity revolution" after Taylor's scientific management and Drucker's management discipline. This "high hat" makes people a little confused. I don't know if Drucker agrees with some people who say that his theory is a "productivity revolution". This does not make sense from a grammatical point of view. Even though we often say that "technology is the primary productive force," scientific giants Newton and Einstein would not dare to say that their theories are a "revolution in productivity," right? !
Believers in positioning theory hold positioning so high, but in fact its status in academic circles is not high. Positioning theory was proposed by Jack Trout and Al Reese in 1969. It was originally used in the fields of advertising and communication, and was later extended to brand consulting and further expanded to strategic consulting.
Philip Kotler in "Marketing Management" regarded positioning as a marketing tool that marketing managers like, but he did not think it was a theory with academic significance. When we look at the series of books by Trout and Rees, it is indeed not an academic research method. They are just constantly using copywriting expressions to prove the correctness of positioning, just like Xie Weishan's expressions are as casual and straightforward.
A theory that is similar to positioning and recognized by academic circles is "customer perceived value." The so-called customer perceived value is a more academic expression.It is the overall evaluation of the utility of a product or service after weighing the benefits that customers can perceive with the cost they pay to obtain the product or service. Why is positioning theory more effective in the consumer goods industry but not so effective in the technological innovation industry? It is more effective to explain it with customer perceived value theory.
In the consumer goods industry, since product differentiation is not big and is mainly driven by marketing, customers mainly rely on brands to make choices, which requires a clear and differentiated brand recognition, which is what is referred to in positioning as occupying the customer's mental space.
However, in the technology and creative industries, due to the great differentiation of products and services, consumers have a stronger perception of technology, design and cost-effectiveness. It is not meaningful to occupy customers' mental space through advertising. Brand recognition tends to be a combination of user perception and experience, rather than a simple communication slogan.
Going deeper, customers' perception of the brand needs to be supported by products, channels and organizational capabilities, which is what is called strategic fit in positioning. Brand positioning is the first step in a long journey. If you want to make customers recognize the brand for a long time, there is still a lot of work to be done. However, the positioning theory is not clear about this aspect, and a strategic title is just a prevarication.
Many companies change their company slogan to "Leader in a certain field" after taking positioning courses. In fact, this slogan still starts from the company itself, and it is difficult to enter the minds of consumers. Moreover, the positioning of leaders must be "strategically consistent" with the company's strength, and it does not mean that it is right or wrong.
Why is it difficult for positioning theory to explain Internet companies like BAT?
The reason is simple: In a rapidly changing Internet market, customers' minds are also constantly changing. It is difficult to occupy customers' mental space through high-density advertising bombardment. The product itself is the best communication.
Why are large companies like Haier and Huawei able to use the same brand in multiple categories and achieve success?
The reason is also very simple, because their organizational capabilities are enough to support them to fight on several fronts at the same time. The reason why many small and medium-sized enterprises need to focus on one category is, to put it bluntly, because their organizational capabilities are not enough, and they can only win on one front!
Positioning likes to elevate themselves to the strategic level and use Michael Porter to "endorse" them. He believes that Porter's "strategy is to create a unique and advantageous positioning, involving various operational activities", and the positioning in it comes from positioning theory.
This is a method of "stealing and substituting". Porter's competitive strategy refers to positioning as an analytical perspective. It talks about the differentiation strategy of enterprises in market competition. There is a complete set of operational behaviors behind it, which is really different from the perspective of positioning theory based on the customer's mind. Of course, you can look at a company's strategy from the customer's perspective, but what Michael Porter calls positioning is much more complicated than the customer's mind.
Any theory has applicable boundaries and scenarios, and is only a certain perspective on the problem. There is no universal perspective or theory. Management consultants need to have three basic skills - systematic and structured thinking skills, rich industry experience and professional skills, and helping companies solve problemsAbility to solve practical problems.
If they think they have mastered the truth of the world after learning a set of theories and tools, it can only be said that they are still in the primary stage of consultants - with a hammer in their hand, everything they look at is a nail! Management consultants need to have more respect for practice. Any theory needs to withstand the test of practice and be able to effectively serve practice, so that theory can have sustained value.
(This article was first published as a column in the September 2016 issue of "Business Value" magazine, and was reprinted by Interface News with the authorization of the author Chen Xuepin.)
