Reading: Defining Positioning and Differentiation

What Makes You Different and Better?

Positioning is a strategic process that marketers use to determine the place or “niche” an offering should occupy in a given market, relative to other customer alternatives. When you position a product or service, you answer these questions:

• Place: What place does the offering occupy in its market?
• Rank: How does the product or service fare against its competitors in the areas evaluated by customers deciding what to buy?
• Attitude: How do we want customers to think about this offering and the benefits it offers them?
• Outcomes: What must we do to ensure the product or service delivers on the positioning we select?

Marketers use the positioning process to identify the distinctive place they want a product or service to hold in the minds of a target market segment. Effective positioning is always aimed at a specific target segment. In fact, positioning tailors the generally focused value proposition to the needs and interests of a particular target segment.

Positioning can be subtle and hard to detect, but it can also be easy to spot when it conforms to your perceptions as a consumer. Perhaps one of the following positions appeals to you: Volvo, for example, positions itself as a family of premium vehicles that are well designed for performance, innovation, and safety. Kia strives to position itself as delivering practical, utilitarian vehicles that offer high quality and value for the price. Cadillac is, well, the Cadillac of automobiles: powerful, luxurious, and catering to every need of its well-heeled drivers and passengers.

Differentiation is closely related to positioning. Differentiation is the process companies use to make a product or service stand out from its competitors in ways that provide unique value to the customer. Differentiation identifies a set of characteristics and benefits that make a product different and better for a target audience. Ideally, these qualities are things that 1) customers value when they are evaluating choices in a purchasing decision, and 2) competitors cannot easily copy. When both conditions exist, the offering is more attractive to target customers.

Differentiation is at work any time you’re choosing between two products in the same category. For example, when you’re buying a soft drink, why do you choose Coke, Pepsi, Sprite, or Mountain Dew? Is it because of the taste? The cost? The level of sugar or caffeine? Or is it something less tangible, like the way you just want to smile when you drink Coke, or you feel amped up when you drink Mountain Dew? These tangible and intangible qualities are what differentiate one soft drink from another.

Interconnected Strategies

Positioning and differentiation are connected in important ways. Effective positioning for a product or service is based on the differentiating characteristics or qualities that make the product/service better than the competition in the minds of the target segment. Positioning and differentiation are strategic activities: marketers work to create the desired position for a product or service in the market, rather than waiting for it to be created by customers, the public, or competitors. The end result of positioning is the successful creation of a market-focused value proposition: “This is the compelling reason why the target segment should buy the product.” Positioning shapes key elements of the marketing mix: which features matter most in the differentiation of a product or service, what messages to communicate about the offering, how to price it relative to competitors, and the role distribution might play in satisfying the customer.

To illustrate positioning in practice, think about Canadian retail chains targeting households as a core segment. The table below highlights how major Canadian retailers position themselves to attract customers and the differentiators they use to stand apart in a crowded market.

Walmart Canada continues to leverage its global strength but emphasizes affordability and convenience for Canadian households that are increasingly price-conscious in the face of inflation. Costco, on the other hand, differentiates itself through its membership model, which creates both exclusivity and loyalty, while its Kirkland private-label products reinforce the brand’s reputation for quality and value. Loblaws and its digital arm, PC Express, illustrate the convergence of grocery and digital convenience, with their PC Optimum loyalty program emerging as one of the most powerful differentiators in Canadian retail. Canadian Tire blends tradition with innovation, positioning itself as the “backbone” of Canadian households, offering trusted products for cars, cottages, outdoor living, and winter survival. Meanwhile, Simons appeals to a design-conscious and younger audience, emphasizing Canadian identity and sustainability through curated fashion and eco-responsible collections.

In each case, positioning is carefully tailored to a particular target segment. Walmart primarily serves price-sensitive families, while Costco focuses on households willing to buy in bulk and small businesses seeking value. Loblaws appeals to families who prioritize convenience, digital integration, and robust loyalty perks. Canadian Tire attracts homeowners, do-it-yourselfers, and outdoor enthusiasts, whereas Simons connects with fashion-conscious Canadians who want curated style choices and sustainable practices. Each of these positioning strategies carves out a distinct niche, helping these retailers stand apart in the consumer’s mind while addressing the needs and values that matter most in 2025.

Positioning is essential for launching a new product or service, because it helps marketers and customers understand how the new offering fits into the set of available choices, and it makes a set of claims about why customers should consider it. Positioning can also be useful at any other stage of the product life cycle to help clarify what makes a product or service different from competitors and why people should prefer it.

Positioning Is a Statement

Positioning plays a critical role for marketers by defining how an offering will stand out and appeal to customers. At the same time, it helps customers understand the choices available to them so they can evaluate and select the product or service that best meets their needs.

The most common way to articulate this is through a positioning statement. A positioning statement is a single, concise sentence that clearly identifies the target market and communicates what customers should think about the brand. An effective positioning statement typically includes:

• The target market

• The brand name

• The key points of differentiation

• The product or service category (the frame of reference in which the brand competes)

• The reasons to believe the positioning claims

Positioning statements must also be rooted in truth. For positioning to be effective, it must be both credible and convincing, aligning with customers’ real experiences and perceptions of the brand. If the statement does not reflect reality, it will fail to take hold in the minds of consumers. Similarly, positioning must be based on qualities that actually matter to customers as they make purchase decisions. If the positioning focuses on features or benefits that are irrelevant, customers will look elsewhere for offerings that meet their priorities.

Sample Positioning Statements for Major Canadian Retailers (2025)

Same Offering, Different Positioning

Because effective positioning is always linked to a specific target segment, it is worth pointing out that the same basic product or service may be positioned differently for different market segments. When this happens, it is because companies recognize that their target segments are looking for different qualities when they make their purchasing decisions. Different positioning strategies for the same product enable marketers to communicate the value of the product or service more effectively to each target audience.

For example, the U.S. airline JetBlue caters to two “sweet spot” target segments: 2) “high-value leisure travellers” and 2) “mixed-wallet customers,” who fly for both business and leisure. The airline’s positioning for “high-value leisure travellers” focuses on attractively priced airfare and packages to fun vacation destinations, along with a comfortable flying experience. For “mixed-wallet customers,” JetBlue positions itself as providing a competitively priced and convenient flying experience with features like expedited security and multiple fare options in case travel plans need to change. In both cases, JetBlue is selling air travel, but the positioning for each target segment is built around the differentiating qualities that make JetBlue particularly attractive to those segments.^[1]

In Canada, Porter Airlines offers a comparable example. From its launch in 2006, Porter focused on business travellers—especially those who are time- and price-sensitive—by positioning itself around premium convenience, such as flying from centrally located Billy Bishop Airport in Toronto, quick check-ins, and amenities like flying boardrooms for executives. Over time, Porter broadened its positioning. By 2015, it expanded to include leisure travellers, offering unbundled fares that let customers pay only for services they valued most, while marketing directly to vacationers seeking affordable, flexible options. Fast forward to 2025, Porter continues to balance these two identities: a convenient, boutique experience for business flyers and a flexible, value-based airline for leisure travellers. This reflects a wider trend in the airline industry toward deeper segmentation and personalization. Rather than trying to be “all things to all people,” airlines increasingly design fare structures, loyalty programs, and customer experiences that align with the needs and values of specific segments. ^[2]

Creation note: This content was updated with the assistance of ChatGPT, a language model developed by OpenAI, and was subsequently reviewed and edited by the author for clarity and accuracy.