Part 3 of 3: A Believable Positioning

A Believable Positioning Opens Up a Brain “Parking Space”

As the famous authors and consultants, Al Ries and Jack Trout wrote many years ago, “Positioning is a battle for the customer’s mind.” A company’s positioning promise must communicate in a manner that resonates with the way customer’s minds work.

We’ve found that great marketers create positioning promises that are important, unique and believable to customers. We’ll briefly explain these principles, and then show how CVS’ strategy to cease selling cigarettes has taught us something new about the concept of believability.

Importance: A companies positioning must promise to satisfy a benefit that is important to customers. A company can communicate its positioning promise in a way that is creative and clever, but if the product itself — or the benefits it delivers — isn’t important to the target market, the positioning won’t be memorable or effective. This is why you often don’t remember the specific product from that “cute” commercial you saw on television last night – it wasn’t something that you needed!

Uniqueness: Uniqueness is also a key principle of an effective positioning. Ries and Trout taught us that the mind is like a parking lot, with each competitor owning a brain space tied to a single word or short-phrase. For example, Volvo is often linked with “safe cars,” McDonalds with something like “fast, not-so-healthy food that kids love.”

So what is the unique position that CVS, and its most significant pharmacy pure play rivals, Rite-Aid and Walgreens, are each trying to own? A quick scan of each company’s website reveals the following tag lines, purpose statements and/or promises:

Walgreen’s: “At the Corner of Healthy and Happy”
Rite-Aid: “Offering the Support You Need to Stay Healthy”
CVS: “Helping People On Their Path to Better Health”

Unsurprisingly, each is trying to own the position of “pharmacy most committed to your health.” As a result, none of the positioning promises is unique from the others.

Maybe this is why there is no dominant player from a market share standpoint. As of 2012, CVS and Walgreen’s each had about 16% of the chain drugstore prescription volume. Rite-Aid was virtually deadlocked with non-pure-play Wal-Mart, at 6.5%.

Our informal survey suggests that this lack of a clear position manifests itself in a lack of differentiation in the mind of consumers. Those we talked to with convenient access to 2 or more pharmacies said that they saw little difference between the companies overall. Their choice of which pharmacy to use was often dictated by a favored pharmacist, or by which chain was closest to where they were at the time.

Believability: But CVS’ decision about cigarettes could change this lack of uniqueness amongst the 3 pure plays, due to the positioning principle of believability. In the past, we’ve taught that believability was more of a supporting positioning principle; if a positioning promise was important and unique, one just had to be sure it could be backed up with believable facts.

What CVS shows us is that when all competitors are vying for the same “brain space,” a brave move can clear out the crowd around a desired position. We think that the revenue CVS is passing up in order to own the “commitment to your health” position will matter to many consumers.

And even if competitors quickly follow suit and stop selling cigarettes, they will still look like CVS copycats. We believe that there is definitely a first-mover positioning advantage here.

In other words, CVS’ strategy may clear a path to uniquely owning the important “most committed to your health” space through the believability of its practices. So, CVS now scores high on a third principle of marketing leaders – a powerful positioning.

Overall, a Solid Move For CVS

When a company makes an interesting strategic marketing move, our clients want to know what we think about it. Will it succeed?

It’s difficult to know for sure, as so many things can affect marketing success. However, the 10 principles and characteristics that we see practiced by the greatest marketing companies of all-time, give us a benchmark – and a strong opinion.

In an era where many companies are over-reaching on acquisitions, diluting their brand equity and suffering from a lack of focus, this looks to us like a solid move that will differentiate CVS from its competitors. It remains to be seen whether CVS’ execution and follow-up strategies can create the kind of success that the companies featured in our book enjoyed.

But the positioning advantage bestowed by CVS’ bold targeting — and its innovation by subtraction — should attract more customers due to its superior focus on health. The profitable growth and market share we are expecting CVS to gain, in a time of a growing health care spending, should make the company’s shareholder’s very happy indeed.

Tom Spitale and Mary Abbazia are the authors of The Accidental Marketer, Power Tools For People Who Find Themselves in Marketing Roles, to be published by Wiley in March 2014.