Positioning strategies are essential for hospitality businesses to establish a distinct identity in a competitive market. By focusing on unique attributes, such as quality, service, or price, businesses can differentiate themselves from competitors and appeal to their target audience. Effective positioning helps create a clear and memorable image in the minds of customers, ensuring the business stands out and meets the specific needs of its market. This strategic approach is crucial for long-term success and maintaining a competitive edge in the hospitality industry.
A positioning strategy is a deliberate plan that a business uses to create a unique image and identity in the minds of its target customers. In the hospitality industry, this involves crafting a distinct brand perception that sets the business apart from competitors. Positioning strategies are central to marketing efforts, influencing everything from advertising to customer experience. They are based on identifying and promoting key attributes that resonate with the target market, such as price, quality, service, or unique offerings.
Positioning is not just about being different—it’s about being perceived as better or more suited to the needs of a specific customer segment. A well-executed positioning strategy clearly communicates why a particular hospitality business should be the preferred choice over others. It aligns the business’s offerings with the desires and expectations of its target audience, ensuring that the brand is relevant, memorable, and desirable.
Key Elements of a Positioning Strategy
- Target Audience: Understanding who the business is trying to attract is the foundation of any positioning strategy. Different customer segments have different needs, expectations, and values, so it’s essential to tailor the positioning to the specific demographic.
- Unique Selling Proposition (USP): This is the key differentiator that sets the business apart. It could be exceptional service, exclusive amenities, location, or cultural integration. The USP should be something that competitors cannot easily replicate.
- Market Perception: How the market perceives the business relative to competitors is crucial. Positioning strategies should be designed to shape and enhance this perception, ensuring that the business is viewed in a favourable light.
- Consistent Messaging: Once a positioning strategy is established, it should be communicated consistently across all marketing channels. This includes advertising, social media, website content, and customer interactions.
Examples of Positioning Strategies in Hospitality
Luxury Positioning: The Ritz-Carlton positions itself as a luxury hotel chain that offers unparalleled service and sophistication. The brand is associated with exclusivity, high-end amenities, and personalised experiences that cater to affluent travellers. Every aspect of the hotel, from the décor to the customer service, is designed to reinforce this luxury positioning.
Budget Positioning: Premier Inn, a UK-based budget hotel chain, positions itself as offering affordable yet comfortable accommodations for cost-conscious travellers. By focusing on value for money, clean and comfortable rooms, and reliable service, Premier Inn appeals to a broad market segment that prioritises affordability without compromising on quality.
Eco-friendly Positioning: The Cordis Auckland positions itself as an eco-friendly luxury hotel, integrating sustainable practices throughout its operations. This appeals to environmentally conscious travellers who seek luxury accommodations without compromising their values. By highlighting its green initiatives, such as energy-saving technologies and eco-friendly amenities, the hotel differentiates itself from competitors who may not prioritise sustainability.
Cultural/Tourism Positioning: The Copthorne Hotel and Resort Bay of Islands positions itself as a destination that offers a blend of modern comfort and rich Māori cultural experiences. By integrating local traditions, cuisine, and art into the guest experience, the hotel attracts tourists who are interested in New Zealand’s indigenous culture. This positioning not only differentiates the hotel but also enhances the overall travel experience for guests.
Family-friendly Positioning: Holiday Inn positions itself as a family-friendly hotel chain with amenities and services tailored for families travelling with children. Features like kid-friendly menus, play areas, and family suites help the brand appeal to this specific market segment. Their slogan, "The Joy of Travel for All," reinforces this positioning by emphasising inclusivity and convenience for families.
Business Traveller Positioning: Novotel positions itself as a hotel brand that caters to business travellers, offering services such as high-speed internet, meeting rooms, and convenient locations near business districts or airports. By focusing on the needs of business professionals, Novotel effectively differentiates itself from leisure-focused hotels.
The Importance of a Clear Positioning Strategy
A clear and well-defined positioning strategy is critical for the success of any hospitality business. It guides marketing efforts, shapes customer perceptions, and influences customer loyalty. Without a distinct positioning, a business risks blending into a crowded market where customers cannot distinguish it from competitors. On the other hand, a strong positioning strategy helps create a loyal customer base that identifies with the brand’s unique offerings.
Strategic business positioning refers to how a hospitality business distinguishes itself in the marketplace to appeal to its target customers. Positioning is a critical component of a business's overall strategy, as it defines the image and value proposition the business presents to customers. A well-defined positioning strategy allows a hospitality business to compete effectively, attract the right clientele, and build a strong brand presence.
3 Keys of Strategic Positioning
An effective positioning strategy delivers the key components that can allow an organisation to understand its market and target audience. Those key components are:
- Channel: A channel is how customers interact with a brand and is the way you communicate and interact with your customers. It could be through social media, advertising, email campaigns or other ways, but whatever it is, the channel plays a critical role in the way your brand is perceived. Correct channel selection ensures your message reaches your target audience at the right time.
- Customer: Understanding your target market’s needs and expectations is crucial in creating an effective positioning strategy as it allows an organisation to tailor its products, services and marketing activities to meet them. Putting the customer front and centre should lead to increased satisfaction and loyalty.
- Competition: As a part of an organisation’s brand positioning, an assessment of how it compares with its key competitors is important. A positioning map can help in showing where its customers perceive it to stand in relation to competitors, and this insight can inform business strategy and show which opportunities can be leveraged to stand out from the competition.
(Adapted from (Collaborators, 2023))
Perceptual Maps and Positioning Maps
Positioning Maps and Perceptual Maps are visual tools which can be used to illustrate how a brand, product or service is positioned in the market relative to competitors. While they share some similarities, there are key differences too: perceptual maps focus on customer perceptions whilst positioning maps are more about how a business intentionally positions itself based on specific attributes or strategies. Click on the hyperlinks for more detail about these useful tools.
Types of Positioning Strategy
A customer-service positioning strategy focuses on delivering exceptional service to create a distinctive brand experience. In the hospitality industry, service quality can be a significant differentiator, especially when products and services are similar across competitors. Businesses adopting this strategy invest in training their staff, personalising customer interactions, and ensuring that every touchpoint exceeds customer expectations. This approach often leads to higher customer loyalty and positive word-of-mouth, which are invaluable assets in a competitive market.
Example: The Ritz-Carlton is renowned for its exceptional customer service. Their "Gold Standards" of service include anticipating guest needs, personalising experiences, and creating memorable stays. Staff are empowered to resolve any issues or enhance the guest experience. This focus on service excellence differentiates The Ritz-Carlton from other luxury hotels and drives strong customer loyalty
Convenience-based positioning aims to make the customer experience as easy and accessible as possible. In the hospitality industry, this could involve offering flexible booking options, strategic location choices, quick service, or seamless digital experiences. Businesses focusing on convenience cater to customers who prioritise ease of use and efficiency. This strategy is particularly effective in urban areas or with clientele who are time-sensitive, such as business travellers.
Example: Holiday Inn Express focuses on convenience by offering amenities that cater to the needs of time-conscious travellers. They provide quick check-ins, easy-to-book accommodations, and "Grab & Go" breakfast options for guests on the move. Located near airports and highways, Holiday Inn Express appeals to business travellers and tourists looking for a hassle-free stay.
Price-based positioning is centred around offering competitive pricing or being the cost leader in the market. This strategy appeals to price-sensitive customers who seek value for money. In the hospitality sector, price-based positioning might involve budget accommodation, discount dining, or special offers. While this strategy can attract a broad customer base, businesses must carefully manage costs to maintain profitability. The challenge is to offer low prices without compromising on essential quality, as perceived value is still crucial in retaining customers.
Example: Premier Inn is a well-known budget hotel chain in the UK, offering affordable accommodation without compromising on essential quality. They position themselves as providing good value for money, with clean and comfortable rooms, consistent service, and strategic locations. By focusing on competitive pricing, Premier Inn attracts budget-conscious travellers while maintaining a strong market presence.
A quality-based positioning strategy focuses on offering superior products or services that justify a higher price point. In the hospitality industry, this could mean high-end accommodations, gourmet dining experiences, or exceptional service standards. Quality positioning appeals to customers who are willing to pay a premium for an enhanced experience. Businesses that successfully execute this strategy often build strong brand loyalty and enjoy a reputation for excellence, but they must consistently deliver high standards to maintain their market position.
Example: Four Seasons is synonymous with luxury and quality. The brand positions itself as a leader in the high-end hospitality market by offering top-tier accommodations, exceptional dining, and personalised service. Four Seasons hotels are known for their meticulous attention to detail and consistently high standards, appealing to affluent travellers willing to pay a premium for quality.
Differentiation strategy involves creating a unique value proposition that sets the business apart from competitors. This could be achieved through innovative services, distinctive branding, or a unique customer experience. In the hospitality industry, differentiation might involve offering specialised services, such as eco-friendly practices, themed experiences, or exclusive amenities. The goal is to make the business memorable and attractive to a specific target market. By standing out in a crowded marketplace, businesses can attract niche audiences and reduce direct competition.
Example: CitizenM differentiates itself by offering a unique blend of affordable luxury and modern design. The hotel brand focuses on providing a boutique experience with features like high-tech rooms, self-check-in kiosks, and stylish communal spaces. CitizenM's emphasis on innovation and design sets it apart from traditional hotels, attracting a younger, tech-savvy clientele who value both aesthetics and functionality.
Creating a Positioning Strategy
- Identify the goal: Clarify the goals for creating your positioning strategy and what you want to achieve. This could be to increase market share, targeting new customer segments or rebranding your business.
- Study the competitors: Identify your competitors and study their positioning in the market, how they communicate their unique value propositions and what sets them apart. This will help you identify opportunities for you to create differentiation in your own brand.
- Create a perceptual map: Perceptual maps are a visual tool which represent how consumers perceive brands in your industry which helps you to understand where your brand’s key attributes and factors sit in relation to your competitors. A perceptual map can help you to see where there are opportunities for you to better position your own brand by plotting it and your competitors’ brands and find out where there are gaps for you to exploit. If you didn’t check out the details on perceptual maps before, click here to read it now.
- Make a timeline: Create a timeline for you positioning strategy by identifying the key milestones and deadlines for its implementation to ensure you keep your strategy on track. Details to add to the timeline should include market research tasks, branding updates, content creation and promotional campaigns.
- Find your niche: Pinpoint your brand’s particular niche which aligns with its unique value proposition and its strengths. Identifying a niche allows you to focus on that area and becoming an expert on it which helps you connect more deeply with your customers.
(Adapted from (Collaborators, 2023))
You’ve reached the end of the learning material for this topic. Let’s recap the key points, and then make sure you’ve completed all the forum discussions and activities.
- A positioning strategy is a plan for a business to create a distinct identity in its customers’ minds and to set it apart from its competitors.
- Three key elements of a positioning strategy include developing an understanding of:
- Target audience
- Unique Selling Proposition (USP)
- Market perception
- Using marketing channels to create consistent messaging
- Examples of positioning strategies in hospitality include:
- Luxury Positioning
- Budget Positioning
- Eco-friendly Positioning
- Cultural/Tourism Positioning
- Family-friendly Positioning
- Business Traveller Positioning
- 3 Keys of Strategic Positioning
- Perceptual Maps and Positioning Maps
- Types of Positioning Strategy:
- Customer-service Positioning
- Convenience-based Positioning
- Price-based Positioning
- Quality-based Positioning
- Differentiation
- Creating a Positioning Strategy
