5.7: Positioning Strategy

Positioning Strategy

Positioning refers to what consumers think about your restaurant concept and how they value your products and services. Thus creating a position entails the construction of the operations image from facility, marketing, menu, and all other services and amenities you might offer to the public. Positioning begs the questions: What do consumers think about our business? In addition to, what do we want consumers to think about our operation?

Begin by segmenting

Establishing a market position for your restaurant concept starts by segmenting the market based on the different benefits that each consumer group that you select to target seeks from the product or services that you offer. As such, a narrow consumer segment would require your operation to resemble certain consistent characteristics. On the other hand, appealing to a broad group of consumer segments would require numerous physical and marketing approaches to speak to each consumer group in ways that attract them to your operation.

For example, attracting consumers from say 18 to 65 years of age is not as daunting as it might seem. Think of it this way, each age group would typically eat chicken, beef, pork, seafood, and various vegetables and starches. The differentiation would occur in the atmosphere of the location, the menu presentation, the pricing, and of great importance, just how you market (frame and present) your offerings to the public.

Positioning is an intuitive process

Positioning often comes down to intuitive decisions. Sophisticated analysis techniques and experience can be helpful, but at the end of the day, the decisions made will probably be subjective - mainly because you are dealing with people, who by nature have strong subjective tendencies. A positioning map can be useful to identify opportunities and specify the current and desired positioning of the operations' products and services.

Differentiation is the goal

The primary goal of positioning strategy is to develop a differentiated product or service that creates a unique mind share, particularly in the target market segment(s). Established positions currently maintained by competitors are best attackable by focusing the operation's resources and promotion efforts on only a small number of particular products, services, or quality features that make your company special. Pick one product at a time and promote that product and its features. Advertising occurs in short durations - have one clear message. Another decision that many operations fail to make involves ‘what’ will be a part of positioning strategy. Said differently, the operation must decide what promotions they will fund and what will not receive funding at all. Advertising equates to dollars spent. Operators must consider advertising from this perspective: if this product and service is worth promoting then really promote it do not dilute the message with other items or issues for consumers to consider. Stay 'billboard' clear at all times.

On the other hand, positions are best defendable with the use of an aggressive, mobile counterattack involving repositioning existing products and introducing new features. This is the reasoning for understanding the strengths and weakness of the competition. At some point you may need to quickly respond to competitors and the better your information regarding their positioning, the better your response will be.

Position by price

Value is one the most important determinations consumers use to justify purchasing decisions. Set the price for the positioned product or services by estimating how much extra quality the product will possess over and above the competition. How much are the target consumers prepared to pay for this extra quality, over and above the competition's actual selling prices? Of course, this value strategy is also applicable to pricing established slightly below the competition. However, pricing set too low can appear by consumers to be an indication of reduced product quality.

Positioning as financially productive

Pricing should always have a purposeful intent. Many operators lose sight of the fact that while the aim of positioning is attracting targeted consumers, the overall purpose is to establish, maintain, and increase the profitability of the operation. Thus, to that end, the operator should estimate the financial feasibility of the proposed positioning strategy. Is there a reasonable chance that the operation's positioning strategy will meet expected sales objectives and obtain the intended market share?

Many experienced operators enter a marketplace with an established restaurant concept. However, this is not always prudent based on the structure of the market. When evaluating a marketplace where no similar restaurant concept exists, the operator can make a decision regarding which type of restaurant would best fit the potential clientele of a proposed trading area. The following are major restaurant categories that bear exploration and utilization subject to the market conditions found in a trading area.