Competitive positioning: definition, choices, examples
Competitive positioning is the place you choose to own in customers' minds relative to rivals. The four choices, examples, and how to find an open position.
Competitive positioning is the deliberate choice of how you want customers to see you relative to the alternatives: who you are for, what you are best at, and which option you beat for that customer. Every business has a position in its customers' minds. The only question is whether it chose it.
The idea was popularised by Al Ries and Jack Trout, whose book Positioning: The Battle for Your Mind came out in 1981. Their core point still holds: you do not win by being better in general, you win by owning one clear place that a competitor does not already hold.
The four competitive positioning choices
Most positions are built from four decisions. You do not need to make all four distinctive, but you need to make them deliberately.
| Choice | The question | Example | The risk |
|---|---|---|---|
| Price | Cheapest, middle or premium? | Aldi: low prices from a deliberately short range | Someone cheaper arrives |
| Audience | Who exactly is it for? | Saga: holidays and insurance for people over 50 | The segment is too small |
| Use case | Which job or benefit do you own? | Volvo: safety, for decades | The benefit becomes standard |
| Category | Lead a category, challenge it, or start a new one? | Salesforce: "No Software" | Nobody searches the new category |
Price is the easiest to communicate and the hardest to hold. A low-price position only lasts if your costs are lower too, which is the cost leadership route in Porter's generic strategies.
Audience is where most small businesses should start. "Physiotherapy for runners" is clearer and harder to copy than "friendly, experienced physiotherapists".
Use case works when one benefit dominates the decision. Volvo built its reputation on safety long before safety ratings were standard, and kept repeating it.
Category is about which comparison you invite. Salesforce's early "No Software" campaign set it against the installed business software sold by the established vendors, so the argument was about how software is delivered rather than whose feature list was longer. Starting a new category gives you a field of one, but only if buyers come looking for it.
How to find an open position
1. Collect what rivals actually say. Copy each competitor's homepage headline and the main message from their current ads into one document. The Meta Ad Library shows every active ad an advertiser is running, which is the fastest way to see the message they are paying to push.
2. Group the claims. You will usually find two or three clusters: "fast", "affordable", "trusted for 20 years". Every crowded cluster is a position you cannot win by joining.
3. Read their three star reviews. Customers describe exactly what the current options fail to do. The guide to finding your positioning in competitors' reviews shows how to turn those complaints into a sentence.
4. List the real alternatives. Not just rivals but what customers would do if you did not exist. April Dunford's Obviously Awesome (2019) starts the whole positioning process from this list, and it is the step most teams skip.
5. Check the gap has demand. An empty position is sometimes empty because nobody wants it. Look for searches, forum questions or lost deals that point at it before you commit.
6. Write it down. One internal sentence your whole team can repeat. The positioning statement examples page has templates and filled-in versions.
The competitive positioning matrix
A competitive positioning matrix is a two-axis chart with every competitor plotted on two attributes customers use to choose. It turns step 2 above into a picture.
The common mistake is the default axes of price and quality. Everyone believes they are high quality, so the chart says nothing. Better axes are specific to how your customers decide: self-serve against done-for-you, generalist against specialist, local against national. The perceptual map template covers how to choose axes and how to plot rivals from evidence rather than opinion.
Positioning mistakes worth avoiding
Claiming what everyone claims. "Quality", "service" and "passion" are not positions. If a rival could put your headline on their homepage without changing a word, you have not chosen one.
Positioning against a rival customers have not heard of. Comparison only helps when the reference point is familiar.
Trying to hold two positions. Cheapest and best, for everyone. Customers believe one or neither.
Changing it every quarter. A position is built by repetition, and teams tire of a message long before customers have even noticed it.
Not checking your own pages. Teams agree a position in a workshop and the website still says something else a year later. Read your homepage as a stranger would, once a quarter.
Questions people ask
What is the difference between positioning and differentiation?
Differentiation is what is different about you. Positioning is choosing which difference to lead with, for which customer, against which alternative. You can be well differentiated and still badly positioned.
What is a positioning statement?
A one or two sentence internal summary of your position. The best-known template comes from Geoffrey Moore's 1991 book Crossing the Chasm: for a target customer with a need, your product is a category that delivers a benefit, unlike the main alternative.
How often should competitive positioning change?
Rarely. It works through repetition, so review it once a year and change it only when the market has moved, for example a rival taking your spot or customers changing how they buy.
See it on your own competitors
Figo checks their ads, pages, rankings and reviews every week, then tells you what to do in plain words. Set up in two minutes.
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