Putting You And Your Company In Position To Own Your Market

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 had expanded to six stores when Howard Shultz bought them in 1987 for $3.8 million. Shultz' vision was to introduce Americans to the European-style coffee houses he'd seen in Milan just four years earlier. He'd noticed how the Italians flocked to tiny corner espresso bars and thought he could export the idea to the U.S.

In 1990, earnings were at $1 million, but by 1992, they were up to $4.1 million, and in 1995, they jumped to $26.1 million. Marketing experts agree that Starbucks' skyrocket to fame 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:

1. People buy for their own reasons, not anyone else's.
2. The stronger position is found in the experience, outcome, or benefit you provide as opposed to the methods you use for producing those outcomes.

Most people do not go to Starbucks because they think the company has a better coffee-making process, or even because the coffee is imported, although these two factors lend themselves to the position of Starbucks as providing an upscale experience. As for the reasons people buy Starbucks coffee, I contend that a large amount of their success rides on how they make their customers feel. Starbucks means soft jazz or classical music, cozy surroundings, tantalizing aromas, inviting and relaxing earth tones. It's not just packaging, it's positioning. The environment of Starbucks creates an experience that invites us to come study for exams, hang out and philosophize with friends, or just 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.

Yet Starbucks proves you don't need to position yourself as more than one or two. You just need to do it well. Consider another example, Southwest Airlines, which has striven to achieve the position of being the cheapest airline, and is also perceived as being a little different. If you're flying Southwest, you know you're going to pay less, be slightly cramped, get peanuts for your "meal," and enjoy personable, often funny flight attendants. Or you can forget the cheap ticket, fly first class on some other airline, stretch your legs, drink champagne, have your in-flight meal and movie, and pay a pretty penny, too.

When I present these options better, different, faster, cheaper to those who attend my presentations and seminars, I lead people to start thinking about which of these positions is easiest to attain and which is the most difficult. What do you think? With price wars so rampant, most people believe that a perception of being cheapest is easiest to create. 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. Southwest has done a phenomenal job of capitalizing on its position, yet you have to wonder how long "cheaper" will hold its appeal in a time when consumers seem to be willing to pay a little more for comfort or service.

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 get the better category as a by-product. Starbucks capitalized on this technique, as did Dennis Rodman, the oddball of basketball. He was on a team with Michael Jordan, yet he came up with a way to take two positions in fans' eyes: both different and better. Okay, maybe he's not actually better than Jordan, who was unbeatable, but certainly he was perceived 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.

When you become different, you own and become that niche, automatically making you the best in the marketplace. No one can be a better Dennis Rodman than Dennis Rodman. Notice many ball players now have tattoos and attitudes, but being "second to market," they do not compete but are at best seen as copies.

Rodman's success helps make another point: You don't have to offer the best product in today's market to win big. I meet individuals and assess businesses daily that have an unbelievable product, yet they are not producing unbelievable results. Likewise, I meet those who have a good, solid product who are performing at optimum levels. Dennis Rodman is good, no question. But is he the best? Doubtful. However, with a good "product" and amazing positioning, he is producing amazing results.

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 voilà: BMW became as hot and desirable as a cappucino on a wintry morning.

BMW marketers had a strong sense both of the position they wanted to hold and had precisely defined their premium clients, the créme de la créme 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.

1.        Who is my premium client? Who would be the most enjoyable and rewarding to serve?

2.        What are this client's unique desires, needs, and challenges? 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."

3.        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?

4.       How can I position myself as an expert in this market? Positioning is like popularity: You have to be seen in the right places and with the right people. But this is not shallow self-boosterism. You will learn more about your clients and they will 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.

And, like Dennis Rodman, don't let your so-called competition distract you. Do you think he sat up nights worrying about what anybody else was doing? I hesitate to speculate just what Rodman's nights did hold, but I can guarantee he wasn't wasting his time wondering how other players would capture the hearts of fans. Rodman does his own thing.

Indeed, winners don't compete; they create.

• Instead of studying someone else's position and attempting to outdo it, top achievers create a unique approach.
• Instead of going after someone else's customers, they create a new market they can ultimately own.
• Instead of trying to get more slices out of the pie, they bake a new one.

Indeed, Starbucks, like Rodman, created an entirely new niche in what appeared to be a narrowly defined market.

And in this creation process, it's just as important what "ingredients" you leave out as what you put in. To stretch our baking metaphor just a little further, if you know you want to make a lemon meringue pie, you don't put pepperoni in it just because you like the taste of it on a pizza pie. In other words, once you know what market you want to create, don't get seduced by money or someone else's urgency to throw extra ingredients into the mix. Once you know what you're creating, stick to it. It will be just as important to gracefully decline and refer customers elsewhere when they are not ideally suited to your services (when they do not fit your premium client profile) as it is to deliver a terrific product to those who are.

Positioning is as much about who you are not as it is about who you are. Starbucks is no 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.