Taking pole position

Darren Shirlaw talks about placing your business in the market astutely

Free guides

Editor's Choice

Place your business in the market astutely and all else will cascade from it – client awareness, brand recognition and ultimately sales – argues Darren Shirlaw

Previously, I described five skills needed by advanced growth businesses. The first of these is positioning.

Advanced growth businesses have established a place in the market and have services, products and prices (MSPP, see graphic) that are readily understood and recognised by customers, suppliers and staff.

There is often confusion between achieving a market position and branding, or designing a new company logo. Positioning determines the market strategy or focus for a business. It’s the choice that a business makes in getting clarity around its market position which then drives the decision about an appropriate brand solution, the focus of its marketing and its sales activity.

The starting point is to ensure you are clear about what you are offering and what clients want. Is your business primarily focused on providing products, or on supplying to a particular market sector or niche segment? Do you focus on providing a particular service or is your main emphasis on price? These questions aren’t as simple as they appear, and I would ask you to give them some consideration.

Recently, I worked with a financial firm looking to expand. It offered broking services, advice and a service for maintaining files. Due to internet sales, broking is now very competitive and it was having to discount. A problem, as this was its main revenue stream. However, it wasn’t charging for its advice, despite its value. Also, its file service wasn’t popular.

Redefining your offer

But when the business was originally set up, the plan was to work with high net worth individuals, helping them with their financial planning. Yet its expertise and knowledge in this area, which was its most valuable offering and could differentiate it from other local firms, was being given away for free.

Having recognised this, the firm repositioned itself as a company that offered a quality service to a niche market and ensured that premium pricing supported this stance. The broking businesss, however, is now a secondary position.

Its offering to clients was redefined and it provides packages (estate planning, investment planning and retirement planning) that included advice, products and third-party services (from solicitors, for example), but all under its name, so it maintains the client relationship throughout.

From this you can see that positioning reflects what a business wants from its customers, product, the quality of service it provides, its pricing strategy and, ultimately, how it presents itself to the market. The design of this position then drives its marketing strategy.

If you get this key skill right the results can be dramatic. We have found that, typically, £1m turnover businesses can normally increase this by 30% once it has followed through with the implementation of its positioning strategy.