Product positioning is the deliberate place a product occupies in the mind of a buyer relative to the alternatives available to them.
A product does not compete only through its physical features. Buyers interpret those features through a frame: who the product is for, what problem it solves, what kind of choice it represents, and what it is worth compared with the options around it. Without a clear position, even a capable product becomes interchangeable with everything else in its category.
Product positioning connects three things: the target audience, the competitive market, and the product’s differentiating value. It asks which people the product is built to matter to, what those people can choose instead, and which advantage the product can credibly own. That advantage may be price, quality, suitability, convenience, status, or another meaningful difference, but it must be legible to the audience and defensible in the product itself.
Positioning comes before messaging. Positioning decides the place the product should occupy. Messaging gives the organisation the claims and proof points needed to communicate that place consistently. A campaign can make a product memorable without giving it a durable position, but durable positioning makes communication accumulate rather than scatter.
Source: Emilie Rose Jones, “Product Positioning,” The Decision Lab Reference Guide. Institutional reference source defining positioning through target consumers, competitors, differentiation, and value proposition.