The first foundational marketing initiative you must complete is market research. By determining your positioning within the competitive landscape and your pricing model, you can better determine how you truly benefit your customers with your products. Whether you are launching a new product or starting a new marketing initiative, creating or revisiting your business’s market research can help you better serve your customers.
When developing your positioning, you must first focus on your audience. Who are they and how do they want to communicate with you (this relates to your messaging)? What do they need from you besides your product?
Remember: You are solving your customers’ problems with your product or products (brand). What they need as it pertains to your product will determine your messaging. But first, you need to understand your positioning before you can develop messaging guidelines and create content.
The process of developing your positioning will focus on two things: 1) your competitors and 2) your potential partners. Developing your positioning in the competitive landscape is the first piece you should focus on. This involves researching your competitors and creating a SWOT (strengths, weaknesses, opportunities, and threats) analysis based on their strengths and weaknesses so you can determine your position in the competitive landscape. Not only do you compare your product or brand with your competitor’s product or brand, but you also keep your audience in mind. You want to find your unique position in the competitive landscape to better serve your customers.
Once you know your positioning in the competitive landscape, you also need to consider your positioning from a partner standpoint. How are you setting your product or brand to work with influencers, brand collaborators, and other potential partners? To compare, you can see what competitors are doing, and what others are doing outside of your product realm and industry. Open yourself up to the potential for partnerships from the beginning so you can target ideal partners once you begin your marketing efforts. This will further deepen your product or brand positioning, setting you apart from other products and brands.
Before you can sell and market your product, you need to determine the best price to sell it for. You have two options: competitive or value-based pricing. Competitive pricing compares your product to your competitors’ products and prices the product accordingly. Value-based pricing is generally used for high-end products as pricing is determined solely on the value it has to your audience. We generally recommend competitive pricing for new products and value-based pricing for high-end products that need a price update.
It’s important to start off with a good pricing strategy in the marketplace because customers often complain when businesses change their prices. You don’t want to price too low and be perceived as cheap and less valuable than your competitors’ products, but you also don’t want to price too high and alienate your ideal audience.
Regardless of which pricing strategy you use, you need to:
- Review your competitors’ offerings and pricing structure
- Do the math on how much it really costs you to create your products (including overhead costs) and compare that to how many products you plan to sell this month and this year
- Research what your primary audience segments are willing to pay for your product
Keeping these pieces in mind will help you find a good balance for your pricing strategy. The key is to ensure you make a profit without requiring too high of a profit per product, which often raises the price too high.
Remember: You need to make a profit. Your company should make a profit, but you, as the owner, deserve to get paid, too.
Tip: If your pricing falls flat and your audience thinks your products are too expensive but you are barely making a profit, it’s time to reconsider how you are creating your products. If this dilemma changes your value proposition, you may want to seek outside guidance.
Depending on your product, you may be able to use scarcity marketing – occasionally. Scarcity marketing for products means having a specific product available for a limited time or availability (i.e. product count). This is not a tactic you should use for all of your marketing efforts or for all of your products, but instead a tactic you use sparingly.
Scarcity marketing encourages sales without lowering the perceived value of your product. Instead, it often increases the perceived value of your product because it has limited availability. This tactic is ideal for high-end, luxury products, but it can also be used by businesses that want to add a product to their offerings on a limited basis.
Ensure the product creation, sales, and marketing teams work together from the very beginning. If that hasn’t happened yet, have these teams collaborate as soon as possible and ensure that they are on the same page concerning your product (or products), your sales strategy, and your marketing strategy.
Our team works as a fluid extension of each of our member’s businesses by developing strategies and executing projects in whatever capacity is best for their unique needs.