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Positioning means designing your product to suit your target market. Before you do this you need to know who your customers are. How you position your product will be determined by the customers you are targeting. Market research is most helpful in analysing potential target market segments. An important consideration when positioning your product is how you are going to reach your customers.

Your choice of distribution channels is an important element in positioning your product because it is through these channels that your customers will get the first impression of your product. You need to establish within your target markets a perception about your product that will differentiate it from that of your competitors. The name of your company, along with the price of your product, the design of the brochure, photography and advertisements will establish and reinforce your unique position in the mind of your customer.

Your competitive advantage is what makes your product more appealing than those of your competitors. It may be something unique you have to offer, it may be superior service or extra value included in the price you charge.