The Art of Product Positioning: Lessons from Airbnb

Product positioning is a critical aspect of your company’s product strategy, as it helps to determine the success or failure of your product in the market. Not only do you need to build a better product, you need to make sure target users know it. Often, the product manager or product marketer are in charge of product positioning. 

In this article, we’ll use Airbnb as an example of effective product positioning and how it positions itself against traditional hotel chains. By following the steps outlined below, you can learn how to position your own product in the market and differentiate it from the competition.

The first step in product positioning is to identify your target market. Who are the customers that you are trying to reach with your product? It’s as important to state who your target market isn’t. Who are the folks you’re not interested in using your product?

In the case of Airbnb, their target market is travelers who are looking for alternative lodging options to traditional hotels. More specifically, they’re often looking for a more localized experience; they want to “live like a local” which is the language Airbnb uses to attract that audience to the platform. Airbnb's target market includes budget-conscious travelers and families, and  more recently business travelers looking for a more unique experience.

Once you have identified your target market, the next step is to analyze your competition. Who are the other players in the market that are trying to reach the same target customers as you? In the case of Airbnb, its main competition is traditional hotel chains. To position itself against hotels, Airbnb needed to understand the strengths and weaknesses of its competition.

Hotels offer everything-in-one-place: sleep, eat, workout etc, all in one place. Their goal is to provide comfort to the traveler. This gives Airbnb a lot of room to communicate its own unique selling proposition.

Once you have analyzed your competition, the next step is to define your unique selling proposition (USP). What sets your product apart from the competition and makes it unique? In the case of Airbnb, its USP is the ability to provide travelers with a unique and more personalized experience, often in unique and unusual properties that traditional hotels can't match. Airbnb offers a more local and authentic experience, with the ability to stay in a local's home and get a taste of the local culture.

Your value proposition is the promise of what your product will do for the customer and how it will meet their needs. In the case of Airbnb, its value proposition is to provide travelers with affordable and unique accommodations that offer a more local and authentic experience. Airbnb's value proposition is to provide travelers with a way to experience the local culture and save money compared to traditional hotel accommodations.

Once you have defined your USP and value proposition, the next step is to communicate your position to your target market. This can be done through a variety of channels, such as advertising, social media, and content marketing. In the case of Airbnb, the company uses a mix of digital and traditional advertising to communicate its position to travelers. Through its advertising campaigns, Airbnb focuses on the unique and local experiences that travelers can have through its platform.

Product positioning can happen at the feature level too. Ecommerce platform Shopify has a built-in email marketing tool merchants can use to sell to their audience. Shopify’s email marketing tool lacks many features compared to a traditional email platform like Mailchimp; however, Shopify positions its email marketing as fully integrated with the rest of your ecommerce store. While lacking features, it leverages its unique position to differentiate from more robust email marketing platforms. 

The final step in product positioning is to continually evaluate and adjust your position based on feedback from your target market. This feedback can come from a variety of sources, including customer surveys, focus groups, online reviews, and user data. In the case of Airbnb, the company continually collects feedback from travelers to ensure that it is meeting their needs and expectations. Based on this feedback, Airbnb can adjust its position and marketing efforts to ensure that it continues to meet the needs of its target market.

Product positioning is a critical aspect of product strategy, and following these steps can help you effectively position your product in the market and differentiate it from the competition. By understanding your target market, analyzing your competition, defining your USP and value proposition, creating a strong brand identity, communicating your position, and continually evaluating and adjusting your position, you can create a strong and lasting impression in the minds of your target customers.

Remember, product positioning is not a one-time effort, but rather a continuous process that requires ongoing attention and adaptation to changing market conditions and customer needs. By following the steps outlined in this article, you can position your product for success and differentiate it from the competition.