Americans have always liked their coffee hot. But then Starbucks
made hot coffee desirable, in demand, and extraordinarily
profitable. And then Starbucks made coffee “cool” with its
super-popular iced Frappucino drink — just as trendy,
fashionable, and universally appealing.
Starbucks is no doubt one of the greatest marketing stories of
recent history. How this company turned an unassuming beverage
into an icon of sophistication and taste is no mystery, however.
It’s all about a marketing tenet called positioning.
The coffee company started out in Seattle’s Pike Place market in
1971 as a single gourmet coffee shop, and by 1995, the chain’s
earnings were $26.1 million. Marketing experts agree that
Starbucks’ skyrocket to fortune centers on its aesthetic sense.
In other words, the public’s perception of Starbucks has to do
with how it appreciates this company’s style. Sure, Starbucks
filled a need and created unique product brands, but what
attracts coffee drinkers again and again is the experience of
the Starbucks environment and its products. Smooth,
sophisticated, artistic: These are seductive qualities even for
a business based on a little brown bean.
The Starbucks story illustrates at least two powerful marketing
principles. Both help us to better understand effective
positioning, or the process of finding a “place” for ourselves
in people’s minds:
- People buy for their own reasons, not anyone
else’s. - The stronger position is found in the experience, outcome,
or benefit you provide as opposed to the methods you use for
producing those outcomes.
Starbucks shows us that it’s not about packaging — it’s about
positioning. The environment of Starbucks creates an experience
that invites us to come study for exams, hang out and
philosophize with friends, or get the day started with a warm
cup of java and the morning news. Starbucks is an invitation to
linger, not just get your coffee and go.
When you are assessing your own position and considering how you
might improve your image and thus your market share, remember
that there are essentially four winning positions: better,
different, faster, or cheaper. You can certainly position
yourself as one of these, perhaps even two; capturing a position
as three of them is tough and probably not desirable, and
cornering all four is just about impossible.
Not everyone is up to the task of creating another Starbucks.
It’s tempting, with price wars so rampant, to believe that a
perception of being cheapest is easiest to establish. Yet in
truth this is the most difficult because of fixed costs. It’s
like doing the limbo: you can go only so low, and then you’re
overextended or flat on your back. Definitely not the easiest
position to be in.
How about being better instead? Contrary to popular belief, this
is perhaps the easiest position to take, since making an
improvement or simply creating the impression of greater quality
or ability has no constraints. One tip: when you capture the
different category, you may get the better category as a
by-product.
Starbucks capitalized on this technique, as did Dennis Rodman,
the oddball of basketball. He came up with a way to take two
positions in fans’ eyes: both different and better. Okay, maybe
he wasn’t actually better than his teammate Michael Jordan, who
was unbeatable, but certainly he was perceived for a time as
better (cooler, trendier) among those who were captivated by his
style. His fashion and fascinating antics made him so unique that
he became unforgettable. And because he was also an excellent
ball handler, he became famous and highly regarded in his
sport.
BMW has also taken the better-different approach. Until fairly
recently, Mercedes-Benz had the better luxury car market sewn
up, so BMW — a competitor with a parity product — simply
repositioned itself. Its tag, “the ultimate driving machine,”
appeals to a younger crowd and gives them luxury with power and
handling. This is “hip luxury,” which is different from the
Mercedes position, which could be summed up as “elegant luxury.”
And voil: BMW became as hot and desirable as a cappucino on a
wintry morning.
BMW marketers had both a strong sense of the position they
wanted to hold and precisely defined their premium clients, the
crme de la crme within their target market. You can do this,
too. Once you’ve figured out what position you can successfully
gain in your business, ask yourself the following.
- Who is my premium client? Who would be the most enjoyable
and rewarding to serve? - What are this client’s unique desires, needs, and
challenges? How can I best serve this client? - What do I (or can I) provide in a unique way to help my
clients achieve their business outcomes? - How can I position myself as an expert in this market?
With this information, you can tailor your marketing efforts —
everything you say to people, any support materials you use,
even the way you dress and act — directly to this audience to
help establish your position. This is the first step to “owning
your market.”
Positioning is like popularity: You have to be seen in the right
places and with the right people. This is more than social
climbing: You learn more about your clients and they learn more
about you when you frequent the same places, attend the same
functions, join the same associations, be published in their
periodicals, and develop products and services specifically for
them.
Positioning is as much about who you are not as it is about who
you are. Starbucks is not a cheaper and faster cuppa joe; it is
an upscale, gourmet coffee experience. BMW is no old-style
luxury; it is stylish performance. Dennis Rodman is no gentleman
forward; he is the outrageous, extreme athlete who is a
recognized celebrity even for people who don’t know basketball
from billiards.
Do you want to win big? If so, have the courage to answer these
questions clearly and define your own game: Who are you? Who are
you not? Who are your clients? These are the essential decisions
you must make if you want to not only understand but own your
market.
James Arthur Ray of James Ray International is an expert in
teaching individuals how to achieve Harmonic Wealth in
all areas of their life by focusing on what they want, opposed
to what they don’t want. He has been speaking to individuals as
well as Fortune 500 companies for over 20 years and is the
author of four books and an inventor of numerous learning
systems. His studies of highly successful people prove that they
continually achieve results by taking control of their thoughts
and actions to create and shape their own reality.
The Power to Win seminar (http://www.ThePowerToWin.com
)
will explain in detail how success is state of mind and how the
principles of quantum physics (as seen in the movie What the
Bleep) can be applied to proven success-building techniques.
James will also cover why people who are successful in one
area of their life tend to be successful in all areas. For more information,
visit http://www.ThePowerToWin.com
