Positioning: Finding an Idea That Meets Customer Needs and Makes Money

(21801)

Positioning is the central idea of your business. Leaders with know-how learn how to position and then regularly reposition their enterprises where they can make money. If you don’t get this right, the foundation of your business can fade away into irrelevance.

Correct Positioning Makes Money

It’s actually quite easy to determine whether or not you have your positioning right. If people like what your business has to offer and you can sell things at a profit, you’ve probably got things right. If people are confused about what you do and therefore reluctant to buy, you probably have your positioning wrong. Over timee, you have to keep adding different things and deleting others to keep your positioning relevant to the changing and evolving marketplace.

Take the example of the newspaper industry:

For many years, the way to make money in this business was simple and straightforward–run as many ads as possible combined with information that people will pay to read.

Then along came the Internet and search engines like Google that in effect allowed the customer to personalize their information gathering activities. As more consumers have turned to the Internet for information, the amount of money advertisers have allocated to print rather than electronic media has steadily declined.

To respond to these new competitive changllenges, newspaper can’t retain their past positioning. Instead, they need to figure out where the new sources of revenue will be, what the new cost structures are likely to be and what they need to do differently to make money. This is difficult because it requires looking at the marketplace in a broader context.

Newspapers may make available news and information that is continuously updated and then broadcast to an iPod or other handheld device. The market may fragment into a much larger number of smaller segments, each of which will need a different approach to packaging and delivering news and information. Successful leaders with know-how engage in this kind of mental gymnastics and develop viable positioning alternatives all the time.

Positioning Is an Ongoing Battle

Positioning is very much an ongoing battle rather than a one-off activity. And just to make the positioning challenge even more interesting, different players in the same industry will adopt radically different market positions. Moves by any individual player will also have flowon effects on the positioning other competitors can reasonably adopt.

When should positioning be modified?

So how can you tell when your positioning will need to be updated or modified? There are various leading indicators to watch for:

When an entirely new market niche emerges and grows

Whenever new competitors start to enter your industry and make nonconventional offerings

When a key competitor radically changes their own positioning

When new technologies come along that dramatically alter consumption patterns

When it becomes clear customers are defecting away from your offerings towards others

When new customers enter the marketplace

When you suffer a significant loss of market share

Whenever new business models or management models take root within your industry

When there is greater-than-normal pressure on your profit margins

When you suffer an unexpected declinein operational cash flows

When there is an obvioius decline in customer satisfaction.2 keys to positioniing know-howMany of these early warning signs for the need to change your positioning will be small in magnitude and easy to miss. You need to search for the right sources of information to pick up on these signals.The two key elements of positioning know-how are generally the mentality to dissect the market and find the spots where the best money can be made and the psychological inclination to confront reality and act sooner rather than later.

Know-How

World-Class Competitors Emerge from Anywhere

World-class competitors can now emerge from anywhere–witness the wave of emerging nation players that have clear advantages in their industries–thanks to the mobility of talent, capital, and knowledge. A Google can come from nowhere and grow into a multibillion-dollar business in a few short years, becoming one of the world’s most highly valued companies. There are not only huge opportunities but also great pitfalls that can swallow up whole companies and industries. Think for a moment about the challenges Google has presented to companies in the advertising, broadcasting, and publishing industries, to name just a few. You will be constantly tested for your know-how to lead your business in the right direction.

-Ram Charan

We Need Leaders Who Know How

Know-how is about what you must both do and be to lead your business in what is shaping up to be the most challenging business environment in decades. We need leaders who know what they are doing. Change is always with us, but its current magnitude, speed, and depth is unlike what most people have experienced in their lifetimes.

-Ram Charan

It’s Not as Tough as it Seems

Whatever you do, however you choose to go about building your own wealth, I wish you luck. I hope I have convinced you that becoming a high-income, high net-worth, independent businessperson might not be as tough as it seems.

-Michael Masterson

Getting Wealthy is Like Getting Skinny

Getting wealthy is like getting skinny. We all want to do it, but few of us are willing to do what it takes. The secret to success, Frank Lloyd Wright said, is ‘dedication, hard work, and an unremitting devotion to the things you want to see happen.’ Are you on your way to seven figures in seven years? You have everything you need right now. So go for it!

-Michael Masterson

« Previous Page — Next Page »