RESULT OBTAINED
Canonical method
Repositioning: deciding whether to move the offer, and how far
What must be established
A useful analysis keeps its controls visible.
- 01
Establish the cause of the decline: a worn position, a choice criterion that has lost relevance or a place taken by a competitor.
- 02
Locate the current position and the target position in customers’ minds, with dated measures, not in the company’s documents.
- 03
Count, segment by segment, the customers the move must win and those it risks losing, before setting its extent.
Decision reference
Make the next choice more explicit.
DECISION SUPPORTED
Should the offer be repositioned, towards which position and how far, given what may be lost among current customers?
DELIVERABLE TO KEEP
A repositioning memo linking the cause of the decline, the extent retained, the target position, the balance of customers won and lost, the expected evidence and the stop signal.
NEXT ELEMENT TO EXAMINE
Customer value mapExplore →Establish why the position no longer wins the choice
A fall in sales does not, on its own, say that the position must change. Three causes call for three different answers. The position may have worn out: the promise is still right, but customers no longer associate it with the offer, for lack of renewed evidence; the task is then to recover what made the offer strong rather than to move it. The choice criterion may have lost its relevance: customers now trade off on something else, and the position, however well held, no longer counts. Finally, a competitor may occupy the place with more credibility, and staying on that ground means challenging it head-on. A fourth explanation, which is not a matter of position, must also be ruled out: the offer itself no longer creates enough value, or the business model behind it no longer works. Changing how the offer is perceived does not correct what it delivers; in that case the decision belongs to the offer or the portfolio, not to positioning.
- Worn position
- Shifted choice criterion
- Place taken by a competitor
- Value of the offer in question
Choose the extent of the move
A repositioning is not a single gesture but a scale. At the first degree, one reinforces: same target, same promise, renewed evidence. At the second, the position is re-anchored on a new choice criterion without changing target. At the third, it extends to an adjacent target without abandoning the current one. At the last, the target changes and the original position is left behind. Each degree costs more, takes longer and puts current customers at greater risk, because it withdraws part of what they had chosen the offer for. The rule is therefore to retain the smallest move that answers the established cause: a worn position is reinforced, a shifted criterion calls for re-anchoring, a taken place calls for different ground. The target position must also be tenable: the company must have the capabilities and the evidence that make it credible, otherwise the move remains a promise that customers’ experience will contradict.
- Reinforce
- Re-anchor
- Extend
- Change target
Draw up the balance of customers won and lost
The risk specific to repositioning is losing current customers for customers who may never come. The balance is calculated before the decision, segment by segment. Simulated example: 1 000 current customers each bring €400 of annual margin, and the target position must attract customers worth €500. If the move drives away 25% of current customers, it costs 250 × 400 = €100 000 of margin a year. At least 100 000 / 500 = 200 new customers must therefore be won merely to break even, before the cost of the repositioning itself. This threshold of 200 becomes the assumption to test: if a limited trial cannot show that it is reachable, the move is too risky at this extent. The memo also sets the stop signal, for example a departure rate among current customers higher than the one assumed, observed over a defined period before the move is extended.
- Margin of current customers
- Assumed loss rate
- New-customer threshold
- Stop signal
DECISION ASSET
Repositioning memo
The move retained is linked to the cause of the decline, to its extent, to the balance of customers won and lost and to the signal that would stop it.
Cause
- Input
- Dated position measures
- Control
- Wear, criterion or competitor?
- Output
- Established cause
Extent
- Input
- Four degrees of movement
- Control
- The smallest sufficient one?
- Output
- Degree retained
Balance
- Input
- Margins and loss rate
- Control
- How many must be won?
- Output
- New-customer threshold
Stop
- Input
- Limited trial and departures
- Control
- Is the threshold reachable?
- Output
- Dated decision
- Keller, Managing Brands for the Long Run: Effective Brand Reinforcement and Revitalization Strategies, California Management Review, 1999 (opens in a new tab)Distinction between reinforcing a brand and revitalising it, by recovering lost sources of value or establishing new ones.
- Kenny, Repositioning Is Not a New Business Model, Harvard Business Review, 2016 (opens in a new tab)Warning: a repositioning makes an offer different without turning it into a new business model.
MOVE FROM ANALYSIS TO YOUR DECISION
Test the preference, credibility and defence of the positioning
MOVE FROM ANALYSIS TO YOUR DECISION
Test the preference, credibility and defence of the positioning
RETURN TO THE DECISION SYSTEM
See the canonical definition of marketing strategy→