Why Brand Positioning is Important for Small Businesses

Have you started a business in a competitive space? Are you struggling to get customers to notice you or find people to give your product or service a go? 

If you’re a small business owner who’s looking to stake a claim in your market, brand positioning is key. Clearly positioning your brand or product helps you understand the benefits and value you bring to the market and makes it easier for your customers to see them too.

In a crowded digital market, it’s not always easy to carve out space for your offering, let alone find an audience who will buy it. So, what can you do?

That’s when you call in the expert!

Marketing for small business

In our Organic Digital Marketing group, we invited Deborah Lanyon, The Small Brand Marketer, to discuss why brand positioning is important for small businesses and how the process actually works. With years of marketing and advertising experience under her belt, Deborah shared many nuggets of gold in our 40-minute live Facebook session. 

Join the Organic Digital Marketing group

If you don’t have time to watch the video, here are the key takeaways to help you understand why brand positioning is vital for small businesses and how you can get started just by answering 5 simple questions.

What is brand positioning?

Brand positioning is about creating an association that holds a strong place in people’s minds. What do you want people to see when they think about your business? Positioning helps both you and your customer. It helps you identify who you want to talk to (your target market) and highlights the reason you’re the best option for your audience (your value).

Whatever the size of your business, you need to have clear and consistent positioning. It’s the most valuable and important tool in your marketing toolbox. Brand positioning is the foundation for everything you do, guiding your story, messaging, copy and advertising.

Illustrating your value to your customers, brand positioning puts everything into context, allowing them to quickly see who you are, what you do and why they should buy from you. On the flip side, poor positioning will diminish the results of your marketing efforts. 

What isn’t brand positioning?

Brand positioning is not a tagline, a slogan, a story or a message. These are tactics. Brand positioning is the strategy that guides your tactics (your logo, slogan, tagline, etc.). It’s important to understand the difference between tactics and strategy to ensure you get the most value from positioning.

Positioning is not your:

  • tagline,
  • logo,
  • slogan,
  • messaging, or
  • story.

Positioning is all about:

  • who you are talking to,
  • what you’re going to say to them,
  • why you’re going to say it,
  • how it’s going to impact them.

What’s the difference between brand and product positioning?

Brand and product positioning are similar but are used differently, depending on the size of your business. If you’re a small business with only one product, your product IS your brand. You should work on product positioning, to improve its place in the market.

If you are a larger business with multiple products, it’s impossible to position them all individually. Instead, you should position your brand, rather than your products. The difference between product and brand positioning essentially comes down to size and scale.

3 components of an effective brand positioning statement

The process of positioning starts and ends with your positioning statement. This helps you and your audience become clear on what you do, who you serve and how you help. An effective positioning statement should include:

  1. FOR component = a statement identifying your target market 
  2. PROMISE component = the main benefit that differentiates you from your competitors
  3. REASON TO BELIEVE component = why your target market should believe your promise

This is an example of a brand positioning statement from Coca Cola using this formula:

For individuals looking for high-quality beverages, Coca-Cola offers a wide range of the most refreshing options — each creates a positive experience for customers when they enjoy a Coca-Cola brand drink. Unlike other beverage options, Coca-Cola products inspire happiness and make a positive difference in customers’ lives, and the brand is intensely focused on the needs of consumers and customers.

5 questions to help identify your brand position

  1. What do you do? How would you describe your business to a friend?
  2. Who really cares about it? Who’s your ideal customer?
  3. Why should they buy from you? What would people do if you didn’t exist?
  4. Why will they love your product? What real value do you offer your customers?
  5. Why should they believe you? How will your customers know they can trust you?

Answering these questions will build a solid foundation for your business, increase confidence and trust and make it easier for you to move forward. 

How to use these tools to establish your brand position

Here’s a fictional example of how these tools can be used to identify a brand position and create strong foundations for future marketing and advertising campaigns.

Meet Susan Smith. She started a small activewear business, ABC Activewear, as a side hustle that has grown into a genuine business. With experience in dressmaking, she knows her activewear is well-constructed and has confidence in her products. Thanks to a strong network of family and friends, she’s been able to attract interest in her products. She’s been able to get some of her pieces on consignment in stores and is starting to get wholesale orders.

As her business continues to grow, she’d like to understand why people are purchasing activewear from her. She’s interested in having conversations with her customers and hearing from them in their own words to understand why they are choosing her products. She’s hoping to find the emotional trigger that will help form the core of her positioning statement.

At this point in the process, Susan’s positioning statement sounds something like this:

For active women who love working out, ABC Activewear provides well-constructed, comfortable yet stylish activewear that, unlike other regular brands, are designed and made in Australia.

While this statement is accurate, it doesn’t really differentiate Susan’s products or help her stand out. Let’s have a look at the process Susan can follow to create a stronger and more effective brand positioning statement.

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The brand positioning process in action

Step 1: What do you do? 

Imagine you’re telling a friend about your business. How would you describe what you do? This is a good starting point to begin the brand positioning process.

If Susan was to describe her business to a friend, she might say she designs and makes original women’s activewear with a focus on comfort and support.

Step 2: Who really cares about this?

This is the key to maximising your revenue return. You can’t move forward until you can identify your target customer. To do this, analyse your customer base and identify those who really love your product. Take steps to understand them as much as you can. 

To understand why are they are buying from you, talk to customers who’ve: 

  • bought multiple products, 
  • referred you to others,
  • commented on your page,
  • left reviews and testimonials,
  • been identified from customer data analysis.

Set up customer conversations to find out what it was that made them buy your product. Get as much information as you can to help you identify who cares about your product and why. Listen especially for the emotional motivation that triggered the buying decision (frustration, anger, desperation, etc).

There are several ways you can do this. You can develop a survey and send it to your email list. You can message customers directly to ask them for their feedback. You can pick up the phone and have a conversation. You can also chat with retailers who stock your products to find out what customers are saying in-store.

The key is to find out what they think in their own words. People are generally happy to help and love sharing their opinions. You have nothing to lose but so much to gain when you take the time to talk to your customers! Remember, you can’t position a product without talking to your customers – otherwise, you’re just making assumptions and taking a guess.

In Susan’s case, conversations with her customers revealed people were frustrated they couldn’t find activewear to fit their non-flat tummies, particularly expectant mums. She also discovered lots of referrals were coming from online mothers’ groups as they loved the fit of her pieces.

Step 3: Why should they buy from you?

Ask your customers where they bought their products before they found you. If you stopped trading tomorrow, where would they go? This is an important step in identifying competitive alternatives to your offering as well as understanding who your competitors are. 

Once you identify your closest competitors, look at their website, their advertising, their social media feeds and their positioning (are they competing on price, geographic area, claims, product, etc?) Find out as much as you can about your competitors so you can begin identifying and isolating your own point of difference. 

Look for features or capabilities you have that others might not. Start by listing the features of your business then map them to benefits for the customer then link them to values. This will help you identify the true value that customers receive from your business.

The goal of this process is to understand what your business offers that your competitors don’t or don’t do very well. This isn’t about putting your competitors down – it’s about identifying a gap in the market that you can fill. You may identify one key difference during this exercise or a combination of things that come together to create unique value.

Your point of difference could be related to a number of factors, including:

  • the product or service itself,
  • the benefits customers receive,
  • whether your offering is the first of its kind,
  • whether it’s the latest or the ‘hottest’,
  • your specialisation,
  • level of experience,
  • depth of knowledge,
  • distinctive visuals or voice,
  • and more.

Susan began looking at other activewear brands to see what was popular, new and trending so she could identify any gaps in the market. In the course of her research, she started to see potential opportunities, especially when it came to the needs of pregnant women.

Step 4: Why will they love your business?

In other words, what value do you offer customers? Your positioning needs to be centred on that value – the value that only you can deliver. This step may lead you towards niching further in your market, which may sound like a scary prospect but it truly isn’t.

Business owners get caught up in the idea of niching down, which refers to specialising in a smaller and more targeted area. The idea of targeting fewer people can seem counterproductive to small business owners, but it’s better to think about it in another way. 

Instead of niching down, consider yourself niching away. This is about using the things that make you unique to attract more people who love that difference. You’re narrowing your audience to target the most promising prospects without narrowing what you do.

In Susan’s case, she identified 3 feature/benefit combinations that only she could offer to her target market:

  1. She could offer real value to new and expectant mums. The wide waist of her tights stops mothers from having to stop and readjust themselves during their workout and makes them feel more comfortable and confident.
  2. Her daughter, a graphic designer, helps her create new, unique and exciting fabric designs, exclusive to ABC Activewear.
  3. As Susan has children herself, she understands the needs of new mothers and can share her experience with them through her designs.

All three points of difference were unique to Susan and her brand. She was the only one in the market who could offer this unique combination of features and benefits. Uncovering her unique value opened up the possibility of developing strong brand positioning based on her strengths.

Step 5: Why should people believe you?

It’s one thing for you to claim you’re awesome – it’s another thing for others to say the same. It’s vital to be able to show why your audience should trust you as part of your brand positioning process. This can be achieved through:

  • Testimonials
  • Reviews
  • Awards
  • Case studies
  • Documented systems
  • Product specifications
  • Media articles
  • PR coverage
  • Social media shares and tags

Use anything that substantiates your claims and can provide proof to your customer that you can deliver on your promise.

Back to Susan. She was able to share testimonials, reviews on social media, products specs and visual evidence of her designs to substantiate her claims and prove she could deliver quality and comfortable activewear to new and expectant mums.

How to put it all together

Once you’ve gone through the process, revisit your original brand positioning statement to ensure nothing has fundamentally changed. It’s especially important to ensure your product is still in the right category. You might find you are operating in the wrong category after the positioning process (especially if you’ve niched away from the broader market).

It’s essential to pay attention to this as customers rely heavily on context when making purchasing decisions. Your customers use what they already understand to evaluate new products. They will have expectations of what a product in a specific category should look like and do and the slightest change in context can affect how they see your product.

In Susan’s case, she realised that her category had changed and she needed to realign her positioning to match. She made the critical decision to transition from the broad category of women’s activewear to the more narrow and specific category of activewear for pregnant women. Susan’s revised positioning statement now reads like this:

For women at all stages of pregnancy who want to continue their active lifestyle, ABC Activewear provides well-constructed, comfortable yet stylish tops and tights that, unlike other activewear brands, are designed with your changing body in mind and to promote a happy, healthy pregnancy.

This is a positioning statement that clearly differentiates Susan’s brand. Even though it’s more niched, it opens up opportunities for a broader range of communications and can be easily turned into a story or become the cornerstone for future messaging. Most importantly, it gives Susan the chance to concentrate on a market that already appreciates and needs her products. 

Brand positioning is about learning about your product, your industry and your customer so you can find the best way to operate in the market and be found, noticed and remembered. Positioning is the foundation for all your marketing efforts, giving you the power to create effective content and advertising well into the future. 

What if you’re just starting out in business? 

If you’re new and don’t have a lot of customers just yet, you’re still in the early exploration stage of your business. As such, you’re not quite ready for positioning – you need to attract more customers before you can understand their motivation and use this to guide your positioning efforts. 

While a full positioning approach isn’t recommended for new businesses, it’s still important to undertake research to ensure your business is viable and has a chance of success. If your product isn’t right, there’s no point trying to position it and expect that will change anything. 

While you evaluate the viability of your business, look at your competitors and see what they are doing differently to you. As customers come your way, strike up conversations to understand what drew them to your product. Once you have returning customers and more data to play with, you’ll be in a better position to look at your brand positioning.

Want more information on brand positioning?

Deborah shared so much information during her session, yet she only scratched the surface of brand and product positioning (we’ll have to have her back soon to uncover more!). If you can’t wait until then, head to Deborah’s website Small Brand Marketing to delve deeper into branding.

You can also join her Facebook group, Shameless Self-Promoters, for more help and support. 

Deborah also recommends checking out the following books:

Many thanks again to Deborah for sharing so much with us!

Interested in discovering more about organic marketing to support your brand positioning efforts? Schedule a free 30-minute chat with Desiree from Naked Digital Marketer to discuss your needs and discover how we can help you get the most from digital marketing.

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