How to nail your product positioning: the ultimate guide

You’ve built an incredible product that delivers value to users and supports your business goals—but what makes your offer so different from everything else in its category?

Product positioning helps you define and communicate what makes your product unique, ensuring it resonates with your target customers.

To make your product the stand-out choice for your audience, you need strong positioning. Keep reading to find out how to achieve that.

What is product positioning? 

Product positioning is the process of defining where your product fits in the market and why it's the best solution for your customers. 

Your product positioning highlights your product's value and why customers should care about it—so it’s best to take a user-led approach.

But first, let's understand why product teams should pay attention to product positioning in the first place.

Why is product positioning integral to product performance?

Good product positioning is the difference between a thriving product loved by customers and one that struggles to make an impact. Without this distinction, it'll be challenging to present a product story and brand message that your customers can relate to. 

Product positioning helps you

• Stand out in a competitive market. In a sea of alternatives, strong positioning makes it crystal clear why your product is the best choice. Without it, you risk blending in and losing potential customers to competitors with clearer messaging.

• Create a unique product image in your customers' minds. The way you position your product directly influences how customers think, feel, and talk about it—turning casual buyers into loyal advocates.

• Keep your brand front of mind. Effective positioning ensures that your product is the first one people recall when thinking about your category. For instance, when you hear “soft drink,” you may well think of Coca-Cola—that’s the power of positioning done right. 

• Ensure consistency in brand messaging. A well-defined position aligns your entire team around a unified message, ensuring every piece of customer-facing content you create reinforces your brand identity. This builds trust, credibility, and loyalty among your customers.

Now that you understand the key role product positioning plays in product and business success, let's examine some strategies to define your positioning.

5 product positioning strategies

Here are 5 popular strategies to inspire your approach to product positioning.  

1. Features and characteristics. Pick a significant and unique product feature and use its benefit as the positioning differentiator for the product. For example, L'Oreal positions itself as a more “natural” choice for beauty and self-care. They mention features like ammonia-free hair-coloring products, referencing a critical benefit: with L’Oreal products, there are no polluting chemicals to worry about. 

2. Product user. This involves associating your product with someone who represents how your target customers want to see themselves. Linking a brand with a particular user—whether that’s a celebrity, an influencer, or just a demographic archetype—can say a lot about your product before you even delve into its features and benefits. For example, Nike’s Air Jordans have traded on the iconography, reputation, and cultural associations of Michael Jordan. 

3. Quality and pricing. One approach is to position your product as representing superior quality, per luxury brands like Prada and Gucci. Alternatively, some brands position their products as affordable, with less emphasis on quality. The low-cost supermarket chain Aldi is one good example of this.

4. Product use. Here you’d focus on making your product a popular choice for a well-defined use case. For example, a particular brand of protein powder that’s used to increase performance at the gym. Since it's unlikely that consumers would buy this product for use in (many) other contexts, their marketing tells would-be customers—bodybuilders and gym goers—that this protein powder will meet their specific needs.

5. Competitors. You can also position your product as a better alternative to a significant competitor by highlighting its differences. For example, Amazon Prime and Netflix are streaming services for movies and TV series, but Amazon offers Prime Music and Prime 2-day delivery. This way, Amazon Prime has positioned itself differently through add-ons its competitor can’t offer.

A 6-step framework for effective product positioning

You can’t nail product positioning in one go and then forget about it. Product positioning is an ongoing process that needs to adapt in response to changes in your industry and your customers' needs.

Let's look at a 6-step framework you can follow to achieve the right positioning for your product.

1. Understand why your target audience uses your product 

Your customers are using your product over your competitors’ for a reason. If you can identify that reason, and investigate what makes them stick to your product, you can use these insights as the basis for your positioning. 

Here are a few ways to research this:

• Study customer reviews to identify what they like about your product. Source these from video reviews, product demos, customer interview recordings, and customer service chats.

• Ask your customer service executives to end every support conversation with "What do you like most about the product?" You could also implement this on a live chat feature on your product's website.

• Place surveys on high-traffic product pages. Ask questions like: "Why do you use this product?", "How would you rate this product on a scale of 1–10?", "Which feature or product element do you use the most?", and "How would you feel if you couldn't use this product anymore?" Answers to these questions will give you authentic feedback into what your customers think and feel about your product.

Pro tip: with the right tools, you can get an effective customer survey launched in a matter of seconds. Contentsquare Surveys has an AI feature that generates questions for your survey based on your goals. 

Better still—once you’re happy with the number of responses you’ve collected, there’s even an AI feature to synthesize them into a report with key takeaways and suggested next steps. 

Use AI to create the perfect survey questions for your positioning research

2. Analyze your competitors

Once you understand your audience, you want to position your product as a better solution than your competitors’. But you can't do that unless you already understand your competitors’ offers.

Conduct market research to analyze your competitors' new and old products to understand how they're helping customers, which features they have, and what benefits they offer. This can inspire you and help you identify what makes your product different.  

3. Identify your unique selling proposition

Your unique selling point is what sets you apart from your competitors and makes your product a big draw. Using your competitor research, find a unique product angle, feature, or application that makes your product better (for someone).

For example, Gillette and Dollar Shave Club are both popular grooming companies. Gillette entered the market with its razors first and became a recognized brand. Dollar Shave Club came up with a similar product but positioned it differently by using affordable pricing as its unique selling point. 

4. Define your product positioning statement 

Now that the research phase is complete, it’s time to create a short description of what your product is, who it’s for, and why exactly customers should care about it. Use this formula: 

[Product name] is a [product category] that helps [target customers] achieve [differentiating benefits your product offers] to avoid/solve [users' needs].

Example: Slack is a collaboration hub that connects the right people, information, and tools to get work done.

5. Communicate your product positioning 

You’ll need to communicate your product positioning both internally and externally. Start with your team members: everyone from the ground floor to the C-suite needs to understand the product positioning you want to achieve, how it will look, and what it means for their day-to-day activities.

Create an internal product positioning document that defines messaging, including what words should be used to describe your product and communicate its benefits to customers. Circulate it across all teams. 

From now on, your brand positioning should affect what you say to your audience through every channel—ads, social media, emails, website copy, and calls. There’s no need to announce that your positioning has changed; simply align your messaging and communication with this new vision. With time and consistency, your brand perception will shift.  

6. Keep your product positioning up to date

Your product will evolve as you grow, and customer behavior and buying trends will change with time. Iterate on your product positioning to ensure it stays relevant. 

Regularly ask yourself these questions to ensure you're leading with the right product positioning:

• Is your current product positioning statement still relevant for your customers and market?

• Have you introduced any big features that offer customers a new benefit?

• Are there any new products in the market your original research didn't account for? 

• Have the market demand or customer needs changed?

• Comparing past and present product metrics, are you getting good results with your current strategy? 

The answers to the above questions will tell you whether your product positioning strategy needs to be refreshed or if it’s still perfectly relevant. 

3 ways Contentsquare helps with product positioning

Product positioning is a crucial factor for product success, and achieving it means getting closer to product-market fit—and getting more sales. However, the success of your product positioning strategy depends on whether you understand your users’ pain points, motivations, and preferences. 

This is where tools like Contentsquare come in. Contentsquare is an experience intelligence platform that helps you empathize with your users. This is fundamental throughout the lifecycle of your product positioning statement: from researching it in the first place, to verifying that it resonates with customers, to checking that it’s still relevant a few months or years down the line. Here's how:

1. Use Interviews to ask you users who they are 

If you want to understand why your customers chose your product over its rivals—the crucial first step in forming a positioning statement—there’s no substitute for meeting them and asking directly. Contentsquare removes the logistical frustrations of conducting user interviews. 

Use Contentsquare Interviews to easily invite your own users to 1:1 meetings or recruit relevant participants from our pool of 200,000+ people. Meet them in our dedicated software and ask why they chose your product. Discuss how their demographic information could play into your positioning strategy and enquire about their experience with competitors’ solutions. Your meeting will be automatically transcribed with AI, so you can review your discussion afterwards and highlight any key quotes that may inspire your product positioning statement.  

Interviews are invaluable for understanding what draws customers to your product

2. Use Surveys to validate your positioning statement

Let’s say you’ve established your product positioning statement and your entire company is on board with it. Now, it’s time to discover whether your customers feel the same.  

Use Contentsquare Surveys to gather feedback on your statement and learn whether it’s a vision your customers relate to. Ask users’ opinions on your positioning statement via questions such as: 

• How do you rate our positioning statement on the homepage on a scale of 1–10?

• Do you think our positioning statement aligns with how we’re presenting our products?

• What do you think makes our product different from others in the market?

You can place this survey on your site's high-traffic pages or send it out via a link in an email. 

Want to ensure the opinions you get back are the most relevant ones? Use User Attributes to ensure your survey only appears to certain user groups, such as users who have already made a purchase or subscribed to your service. 

With User Attributes for Surveys, get your positioning statement validated by the demographic of users whose approval you need the most

3. Review product analytics data

Now let’s skip ahead and say that your positioning statement has been in place for the past 2 years. How do you know if it’s still a useful guiding star?

One indicator that you need to reassess your positioning is that your product metrics are declining. With Contentsquare, you can set up an unlimited number of custom dashboards to track relevant metrics. Create a product dashboard to track KPIs like conversions, sign-ups, and retention rate—if they’re consistently decreasing, it’s time to re-test your positioning.

Second, Contentsquare’s Benchmarks lets you compare your key metrics—including conversions and sessions with transactions—to your competitors’ statistics. If you notice that you’re losing traction compared to others in your niche, that’s another sign to revisit your positioning. 

Use Contentsquare Benchmarks to get an idea of your product’s position in the market 

Boost brand awareness with the right product positioning

Through good product positioning, you can create awareness about your brand, the values it stands for, and the product features, benefits, or personalities you want to be known for. This helps you manage customer perceptions and create a stellar product image in your customers’ minds. 

To master product positioning, focus on your customer rather than just your product or brand. Instead of using positioning to persuade your customers that your product is a good fit for them, learn their needs inside out and design your positioning around them. It’s a time-tested tactic for creating strong demand and lasting success. 

FAQs about product positioning