What’s Behind Brand Positioning: The Survivorship Bias

This morning, our team leader raised an intriguing question that got me really excited! Experienced business minds often emphasize the importance of brand positioning, but are the numerous failures of brands due to poor positioning? Moreover, many once-successful brands eventually fade into obscurity. Was their demise truly a result of inadequate positioning?

Let’s discuss the “survivorship bias.” Many currently successful brands attribute their success to precise positioning. But did other unsuccessful brands not also position themselves well? Take the probiotics market, for instance, where numerous companies vie for a similar niche. Some succeed, others fail, highlighting that not every competitor thrives under the same positioning.

Some brands try to find new paths, using differentiation to seize fresh opportunities. Yet, in the homogeneous competition within Chinese society, many big and small players rush into these new niches. Thus, brands that initially won market share through innovative positioning aren’t always able to outlast their newer competitors. Is this a failure of positioning? Clearly not.

A few years ago, Taiwan Sugar’s clam extract enjoyed a dominant market share exceeding 60%. However, with Yili’s enhanced distribution, advertising, and brand strength, their market share waned over time. Did Taiwan Sugar misposition itself? Was Yili’s positioning different? Not really.

Consider Books.com.tw. Was its positioning unclear? It was the first choice for online book purchases. Did its business decline due to poor positioning or challenges like competitive business models, past PR crises, or system issues?

Similarly, Lin Fengying once led the fresh milk market with outstanding advertising and superior quality, positioning itself as a favorite among consumers. However, due to the Wei Chuan cooking oil incident, it no longer holds the top spot. Was its failure purely due to positioning issues?

Positioning is a valuable concept, but it’s only the first step. From many cases, we find that while positioning is indeed crucial for success, it’s not the only key. Din Tai Fung, renowned globally, initially sold oil but thrived after a fortuitous shift in business. This illustrates that positioning isn’t static; positioning that facilitates sustained growth is the real key. When necessary, even product shifts are possible. Surviving in the market and accumulating credibility over time is what truly matters.

Looking back at Nokia, Kodak, HTC, and Apple, we further understand this point. If focused solely on current market share without insight into market trends, one might win today but falter tomorrow. Sometimes, losing in the beginning sets the stage for winning later.

Furthermore, if positioning were infallible, NVIDIA wouldn’t have emerged. Huang Renxun believed in “believing first, seeing later,” challenging traditional positioning strategies.

Positioning is just the beginning. From the growth trajectories of many brands, I believe:

• Operational foresight prevents many mistakes.
• Having ample conviction. Huang Renxun’s “acknowledge mistakes, persist, retreat!” offers a path beyond conventional wisdom.
• Never idolize fleeting positioning as the market’s feedback loop allows for necessary adjustments. This is an area where art meets conviction, not easily achievable.