What Is Brand Positioning? Definition, Example, and Why It Is Important

a series of concentric circles: brand positioning

Shoppers have so many options to choose from. So, why buy from you? What makes your product different from the rest?

Smart entrepreneurs use brand positioning to answer those exact questions, and win over customers. Brand positioning expresses how a brand is uniquely different from their competitors. Effective brand positioning influences a customer or potential customer to see your brand as having a better value proposition. If they believe your brand will meet their needs, they’ll choose yours over others, become a loyal customer, and even pay a little more for it. 

Learn how to craft your own brand positioning strategy and measure its success.

What is brand positioning?

Brand positioning is a marketing strategy brands develop to establish the uniqueness of their brand and convey its value proposition. It begins with a positioning statement, which companies use internally to identify their target audience and build their brand identity. The purpose of positioning your brand is to make clear to your consumers what you stand to offer and why you’re uniquely positioned to serve them.

Free Reading List: How to Brand Your Business

A great brand can help your products stand out from the crowd. Get a crash course in small business branding with our free, curated list of high-impact articles.

Ultimately, brand positioning is the foundation of brand strategy; it’s a way of carving out your unique position in the marketplace and in consumers’ minds.

Brand positioning example

One company in a crowded market—women’s shoes—differentiated itself by highlighting its mission of sustainability. Rothy’s is known for its flat shoes and accessories that are made for women who want comfort and style but not at the expense of the environment. The company transforms single-use plastic water bottles into shoes with 3D knitting technology. Insoles are made with algae-based foam and recycled rubber. 

Rothy’s brand positioning is that you can get a cute pair of shoes while at the same time helping the environment by recycling plastic bottles. 

Rothy’s uses its brand messaging to appeal to eco-conscious women, stating on its website: “Circularity is the future of sustainability. And what does circularity mean? At Rothy’s, we think of it as a continuous loop that renews itself, from material and manufacturing to product and recycling. Our vision is to use twice-recycled materials in new products—to close the loop, like nature does.”

This is an example of a public-facing brand positioning statement in that it explains what the company does and why—and who it’s for. 

How to develop a brand positioning statement

  1. Understand your audience
  2. Research your competitors
  3. Define your unique value proposition
  4. Draft a statement

1. Understand your audience 

Identifying your ideal customer will help you understand how to position your brand and will inform every marketing plan and strategy you undertake. Age, income, gender, and location are common traits you can use to narrow down your audience. To get more granular, you can separate your audience by their interests, such as hobbies or the kind of entertainment they like. 

2. Research your competitors

Along with understanding what your audience wants, you should know how your competitors are positioning themselves to appeal to the market. Find your competitors by doing market research for the type of product or service you offer.

You likely have direct competitors that offer a similar product to the same audience, and indirect competitors that offer an alternative to your product or target a different audience. Finding out how they position themselves can help you determine how you can stand out.

3. Define your unique value proposition

Your unique value proposition (UVP) is the magic sauce that differentiates your product or service from all the rest. It includes how you solve your customers’ problems, or “pain points,” the specific benefits you offer, and why people should buy from you instead of the competition. Write with your customer in mind. Avoid using technical language or industry jargon they might not understand. There’s no single way to write a UVP, but it should do these things: 

  • State the benefit your product offers
  • Explain who you serve and how you solve their problem
  • Say what differentiates your product

Your product or service differentiator will serve as the core of your brand positioning statement.

4. Draft a statement

When you’re ready to create a positioning statement, start by writing a simple, memorable description of your target audience. Explain how you want them to view your brand. 

A positioning statement can be public-facing, but it is primarily an internal document that acts as your company’s lodestar. Every marketing action you take should align with it. Many brands compare their business decisions continuously against their positioning statements. 

It should address:

  • How your product or brand differentiates you from competitors, often called the point of differentiation (POD)
  • Reasons your positioning statement is credible, and why your target market should believe you’re different
  • How your company is uniquely qualified to deliver on its brand promise

How to measure the success of your brand’s positioning 

The purpose of positioning your brand is to make clear to your consumers what you stand to offer and why you’re uniquely positioned to serve them. You’ll know your efforts were successful if your target audience knows your brand and if positive perception has led to brand loyalty. You can use some simple metrics to assess these results:

Brand awareness

To understand how familiar people are with your brand, you can conduct surveys, analyze your website traffic to see if you have year-over-year increases, and track your social media engagement. 

Social media engagement

Your social media engagement can tell you a lot more than how many likes you’re getting. It can show you if you’re making a connection with your audience—and if you’re attracting the audience you’re aiming for.

Brand perception

Positioning doesn’t aim only to make an audience more aware of a brand but also to understand how they feel about it. You can read online reviews about your brand, give customers a space to review your website, interview focus groups, and conduct a competitive analysis to see how your brand’s perception stacks up to your competition.

Brand loyalty 

Your customers are aware of your brand and perceive it positively, but is your brand unique and compelling enough to secure their loyalty? You can track repeat purchases online and calculate your customer retention rate (the number of customers you retained versus your total number of customers). You can also calculate your net promoter score (NPS)—the percentage of your detractors subtracted from your percentage of promoters.

How to improve your brand positioning strategy over time

As you evaluate your brand metrics over time, you may find that you need to change your positioning. Consider these ways to approach it: 

  • Talk to your employees. Set aside time to chat with your employees who engage every day with your positioning to assess if it’s still relevant. Ask them what changes they’d like to see and where reality may be disconnected from the current positioning. 
  • Monitor your digital metrics. Regularly review social media engagement and traffic on your website to spot drops in interest. This can help you determine whether your messaging has grown stale or veered too far off course. 
  • Conduct focus groups. You may find that a focus group provides insight into what your brand positioning communicates—unintentionally or intentionally.

Create branded emails in minutes with Shopify Email

With Shopify Email, you can easily create, send, automate, and track email campaigns all from your Shopify admin—no coding required.

Discover Shopify Email

Brand positioning FAQ

Why is brand positioning important?

Brand positioning is important because it helps you differentiate your brand from competitors, establish a unique identity, and communicate with your target audience. Successful brand positioning helps consumers understand why they should choose your brand over others.

How can a competitive analysis inform a brand’s positioning strategy?

The very basis of brand positioning is differentiating your brand in the marketplace. Understanding your competitors’ strengths and weaknesses is essential to defining your brand’s unique position.

What are some common mistakes companies make when positioning their brand?

Some common mistakes include creating a positioning statement that is not specific and neglecting to collect feedback from real humans.