THE GRADUATE PROJECT IN MARKETING _b (Repaired) (1)

How To Position and Differentiate in the Market? 1
GRADUATE PROJECT
COURSE BMKT 695
HOW TO DIFFERENTIATE AND POSITION IN THE SERVICE MARKET?
Submitted to the Lebanese International University
The School of Business
In Fulfillment of the
Requirements for the Degree of
(Master in Marketing)
By
HADIL BOU OMAR
ID No.50830348
Tripoli, Lebanon
Supervised by Advisor
Dr. Sam El Nemer
Spring 2013-2014

DEDICATIONS
I would like to dedicate this work to Almighty God for the blessings and strength.
To my husband, son and family for their support.
Without your counsel I could not have completed this process.

ACKNOWLEDGEMENTS
First I would like to take the greatest pleasure in conveying deep thanks to those who helped
make the completion of this work possible. To Dr. Sam El Nemer for his guidance, thorough
instructions, and kind support over my graduate project, his constructive criticism was very
much appreciated. My honest cannot thank him enough.
There are people who have been instrumental to me and whose contribution I truly
appreciate. I would like to thank my family for their love and support during my study
period.
I owe special thanks for my instructors, friends, and every close person who encouraged me
to make this project possible.
I'm also grateful for the love and support of my husband, and most importantly I thank the
Almighty God for the life and good health he gave me throughout the writing of this thesis.
Last but not least I owe special thanks for that who has always given me overwhelming
encouragement. My gratitude to you goes beyond what words express.

ABSTRACT
This study aims to investigate the theoretical framework of positioning and differentiation
strategies; (how a company can create a unique and distinctive image for a brand relative to
competition and how brand should be perceived as different from competitors by consumers.)
The project also attempt to investigate and relates the topics on the level of market
differentiation, focusing on (price/quality differentiation), and how a company can gain a
competitive advantage over competitors.
I used both quantitative and qualitative research approaches in my study and relied mainly on
primary data.
I made use of STP model and other studies to explain that phenomenon, and applied the T-
Test to evaluate the hypothesized relationships. Further we qualitatively analyzed aspects of
the data hinging on explanatory aspects of our research.
The results among other things revealed that other laser clinics service quality (especially
responsiveness and empathy), technologies and innovation, promotional strategies and
advertising campaigns plus low prices are important instigators of customer satisfaction and
loyalty, which in return the company position is being affected.
Finally the findings of this study agreed to a large extent with the theoretical principles and
empirical results espoused in the literature review. The analyses of the results have confirmed
all the stated hypotheses

TABLE OF CONTENT
PART I: THE THEORETICAL FRAMEWORK............................................................... 8
CHAPTER 1: INTRODUCING THE GRADUATE PROJECT ................................... 9
1. INTRODUCTION................................................................................................... 9
2. OVERVIEW OF THE SECTOR/DOMAIN/ORGANIZATIONS................... 15
CHAPTER 2: LITERATURE REVIEW
1. MAIN TOPIC (Positioning).................................................................................. 19
2. SUBTOPIC 1 (Differentiating strategies).............................................................. 31
3. SUBTOPIC 2 (Model of positioning).................................................................... 40
PART II: THE PRACTICAL FRAMEWORK ................................................................. 43
CHAPTER 3: RESEARCH METHODOLOGY ........................................................... 44
1. DATA COLLECTION METHOD ...................................................................... 44
2. STUDY LIMITATIONS ...................................................................................... 62
CHAPTER 4: FINDINGS AND RESULTS ................................................................... 70
1. DATA ANALYSIS METHOD............................................................................. 70
2. FACT FINDING RESULTS ...............................................................................106
PART III: GRADUATE PROJECT CONCLUSIONS AND RECOMMENDATION 111
CHAPTER 5: CONCLUSIONS & RECOMMENDATIONS .................................... 112
1. CONCLUSIONS ................................................................................................. 112
2. RECOMMENDATIONS.................................................................................... 114
APPENDIXES ..................................................................................................................... 115
REFERENCES.................................................................................................................... 121

LIST OF TABLES
Table 4.37: Cross tabulation………………………………………………...89
Table 4.38: Cross tabulation ……………………………………………….94
Table 4.39: Group statistics H1..…………………………………………….100
Table 4.40: Independent sample test H1……………………………………..100
Table 4.41: Group statistics H2……….……………………………………...101
Table 4.42: Independent sample test H2……….……………………………..102
Table 4.43: Group statistics H3…………………….………………………....103
Table 4.44: Independent sample test H3……………….…………………...…103
Table 4.45: Group statistics H4…………………………….……………….....104
Table 4.46: Independent sample test H4………………….………………...….105
Table 4.47: Hypotheses testing summary…………………………….……..…110

LIST OF FIGURES
Figure 1.1: Positioning Model…………………………………….………………..9
Figure 1.2: Differentiation………………………………….………………………10
Figure 1.3: The project hypotheses…………………………………………………14
Figure 2.1: The four categories of service…………………………….…………….19
Figure 2.2: Brand positioning…………………………...………………………….20
Figure 2.3: Effective positioning strategies…………………………………………23
Figure 2.4: Principles of positioning………………………………………………..24
Figure 2.5: A perceptual map……………………………………………………….26
Figure 2.6: Position map……………………………………………………………30
Figure 2.7: Market differentiation strategies……………..…………………………34
Figure 2.8: Price/quality differentiation.....................................................................35
Figure 2.9: Brand differentiation analysis…………………..………………………36
Figure 2.10: Service differentiation tools…………………………………………....37
Figure 2.11: The STP model…………………………………………………….…..40
Figure 2.12: Positioning and differentiating model…………………………….…...41
Figure 3.1: Reliability and validity..…………………………………………….…..48
Figure 3.2: Research paradigm….…………………………………………………..63
Figure 3.3: Positivism &intepretivisim……………………………...……………...64
Figure 3.4: Ontology……………..…………………………………………………64
Figure 3.5: Epistemology………………..………………………………………….66
Figure 4.1: Bar chart…………………………………………..……………….……93
Figure 4.2: Bar chart…………………………………………………………..….....98

PART I
THE THEORETICAL FRAMEWORK

CHAPTER 1: INTRODUCING THE GRADUATE PROJECT
In this chapter there will be an introduction for the reader to the structure of the thesis,
background of the study, definition of the problem, purpose of the study, and definition of key
concepts of the conceptual framework.
1. INTRODUCTION
1.1 Introduction of the project:
This project will investigate the theoretical framework of positioning and
differentiation strategies; (how a company can create a unique and distinctive
image for a brand relative to competition, and how brand should be perceived as
different from competitors by consumers.)
The project also attempt to investigate and relates the topics on the level of
market differentiation, focusing on (price/quality differentiation), and how a
company can gain a competitive advantage over competitors.
Figure 1.1: Positioning Model
Source: Donnelly, J. H. (2002).
1.2 Introduction of the company:
Silkor a (laser medical center) operating in Lebanon and Middle East. Silkor is
an industry pioneer and a leading chain of laser hair removal; it addresses customer
needs with the most advanced, proven, non-invasive medical and aesthetic
technology. Silkor enhances the personal well-being, confidence and self-esteem of
its customers in a safe and professional environment.

1.3 Researchproblem.
Positioning is about how you differentiate your business in the mind of your
Prospects. (Kotler, 1995)
Differentiating a business is a competitive business strategy; where firm attempt to
gain competitive advantage by increasing the perceived value of their
products/services relative to the perceived value of other firms.
The challenges begin by finding ways to differentiate:
 Create value for buyers.
 Not being easily copied or matched by rivals.
Service markets face several problems in positioning, because service is intangible
image, so a specific image should be linked with a specific brand name.
It is more difficult to perceive service quality, because services are intangible and
variable and they are simultaneously produced and consumed.
Consumers usually rely on extrinsic cues to evaluate a service quality, because
quality services vary from day to day, from persons to persons and from customer to
customer.
The framework for researching service quality stems from the premise that a
consumer evaluation of quality is a function of the magnitude and direction of gap
between expectation and perception.
High prices of a service could also be a problem for differentiating a business,
because how consumer perceives a price, has a strong influence on both purchase
intention and satisfaction
Figure 1.2: Differentiation model.

Source: Kotler, P. & Armstrong, G. (2008).
So the main problems of this research would be:
 Service differentiation is hard since service is intangible and may vary from
person to other.
 Positioning a service is more difficult than positioning a product because of
the need to communicate vague and intangible benefits.
 Even companies who cultivate long-term relationships and provide extra
service cannot count on customer loyalty, since customer count on best
services with affordable prices.
 The influence of competition on customers can form a discipline of new
decision behaviors.
 Services perceived prices may affect customer perception and satisfaction.
 The use of price/quality differentiation fosters a calculative behavior, where
customers continually look for the best deal, which lead to customer churn
and increased acquisition cost.
 Competitions cutting into the service market share affect consumer choices
and perceptions.
1.4 Objectives of the graduate project:
Given the explanatory nature of some aspects of this projects objectives,
I will provide you with detailed information, a focused qualitative research
(Theoretical framework) Would be used to explore and understand the concept of
differentiation and Positioning strategies, so the overall objective is to "understand
the essence of positioning and differentiating a service".
This has been broken into sub- objectives, which reflects the research questions.
The most important part of research is to define the research question. By defining
the research question I will be able to specify and quote the research objectives,
hypothesis to be tested, information needs, and the appropriate research design. This
study attempts to answer the following:

Researchquestions:
Research Question 1: What are the main competitive factors that affect consumer choices in
the Laser Beauty Industry?
Research Question 2: What should Silkor do to differentiate itself from competition?
Research Question 3: How can Silkor maintain market leadership in customer’s minds over
the long run?
These research questions use concept statements and appeal ratings to assess qualities of
positioning distance, or differentiation power.
The main research question is divided in to several sub-research questions that correspond.
 How does competition cut into the company market share affect the company
position?
 How does differentiation help the company achieve a competitive advantage?
 How does meaningful and believable position build customers loyalty?
 How does understanding customer needs and perceiving competition, lead to
effective positioning?
 How do errors and mistakes affect positioning of a company?
 Why positioning a service is much harder than positioning a product?
 How can price/quality differentiation affect a company position?
 Why it is essential for a firm to stay in touch with the market and reposition
itself before it suffers in terms of image and revenue?
 How positive influencing growth and capturing new customers promote
loyalty to a brand?
 Why ineffective differentiation can leave the business buried in the middle or
at the bottom of the pack?
 What are the primary market differentiation strategies that help the firm
overcome the competition?
 How does the relationship between communicating and monitoring position
anticipate competitor's moves?

The following research questions are answered with the qualitative study done through the
literature review.
The research will be carried out to refine the objectives and provide detail for the next stage
that gives a useful indication about the company (Silkor), by conducting a quantitative
research (practical framework). I propose to carry out a questionnaire conducted on Silkor
customer as an effective way for contacting relevant respondents.
The overarching goal of this thesis is to determine and explain the concept of differentiating
and positioning a company service, and the ways by which a firm can stay ahead of the
competition.
For the purpose there will be more focus on understanding, how customers perceive a
company position, and how he differentiates it from competitor position.
The following research objectives are to explain in detail what the study is expected to
achieve:
 To understand the essence of competitive positioning.
 To discover strategies used in effective positioning.
 To determine position techniques that companies use to stay ahead with
competitors.
 To identify the positioning errors made by firms.
 To allow in-depth exploration of Mechanisms related to how well the
company products and Services are perceived by Customers, and how the firm
can achieve a competitive advantage over the Competition.
 To list the ways a company can reach and win a market.
 To uncover the method used to reposition a business.
 To identify why position a service is harder than positioning manufacturing
products.
 To list the primary market differentiation strategies.
 To understand the nature and terminology of differentiation.

1.5 ResearchHypothesis
Null hypotheses:
(H01): Competitive price and customer loyalty are independent.
(H02): Competitive promotional strategies and advertising campaign are independent with
customer loyalty.
(H03): Competitive high quality services and customer's loyalty and satisfaction are
independent.
(H04): Competitive new technologies and innovation, and customers choices and decisions
are independent.
Alternative Hypotheses:
HA1: When Silkor direct competitors reduce their price, customers will be drawn away from
Silkor.
HA2: When Silkor direct competitors launch promotional strategies and advertising
campaigns, customers will be drawn away from Silkor.
HA3: High quality services relates positively in affecting Silkor customers loyalty and
satisfaction.
HA4: Laser medical centers new technologies and innovations are affecting customer's
perceived choices and decisions.
Figure 1.3: The project hypotheses.
H1: competitive technologies
H2: competitors low prices
H3 : competitors promotions
H4 : competitors high quality
services
Affecting
customer
choices
and
decisions
Silkor
position
is
affected
Silkor must
differentiate
itself from
competition

2. OVERVIEW OF THE SECTOR/DOMAIN/ORGANIZATIONS
Silkor (Laser medical center)
2.1. Company Profile and History
Established in Beirut Lebanon in 1997, Silkor is an industry pioneer and the Middle
East and North Africa (MENA) region's leading chain of laser hair removal, laser medico-
aesthetic and skin care services. The company specializes in treatments that promote
smoother, more radiant skin, for both men and women.
Treatments are performed by highly skilled dermatologists and medical practitioners and take
place in a relaxed comforting atmosphere.
Silkor addresses customer needs with the most advanced, proven, non-invasive medical and
aesthetic technology. Silkor enhances the personal wellbeing, confidence and self-esteem of
its customers in a safe and professional environment
The name Silkor is a play on words combining the English "Silk" with the French
"Corps"(body). This encapsulates the Silkor mission - to provide the smoothest and least
intrusive luxury laser medico-aesthetic and skin care treatments.
In June 2009, a peaceful Lebanese general election took place, bringing back a pro-western
government. Lebanon's economy was booming, it was during that time that brother and sister,
Oscar and Lara Tarakjian, reflected on the remarkable 12 years history of Silkor, their
successful hair removal company based in Beirut, the capital of Lebanon with branches
around the Middle East. Although Silkor had established itself as the brand leader in the
region, the duo felt that they had many challenges ahead of them. One main challenge was
related to growth. They wondered how they are going to leverage their strong brand while
expanding geographically and extending their product line. They also wondered how they
would expand without diluting their quality competitive advantage or the entrepreneurial
spirit which characterized Silkor’s culture. (Silkor.com, 2014)
2.2. Main Products & Services
Laser Treatments
Medical Services
Skin Care Therapy

2.3. Vision & Mission
Vision: To establish Silkor as the trusted regional leader in high quality, technology-driven,
personalized laser medical and skin treatment.
Missionand Statement of Purpose: Silkor enhances the personal well-being, confidence
and self-esteem of its customers in a safe and professional environment.
Values: It is Silkor’s people who make Silkor what it is and who believe that putting the
company values into practice creates long-term benefits for all stakeholders. Silkor values
include:
• Customer service excellence
• Teamwork in a Silkor family environment
• Entrepreneurial spirit and a passion to win
• Constant innovation in high-end services
• Excellence in operational execution
Slogan: "Baby skin forever"(Silkor.com, 2014)
2.4-Innovation:
Scientific and technological innovations in laser medico-aesthetic treatments are advancing at
the speed of light.
With a dedicated medical advisory team charged with exploring new Technologies, Silkor
continuously evaluates new therapies, equipment and procedures to ensure Best results ‘and
value for its clients.
Thanks to Silkor's size and reputation and its relationships with manufacturers and researchers,
its team is in a position to evaluate new laser medico-aesthetic technologies even before they
come on the market. This puts Silkor in a prime position to stay ahead of the field and provide
the best service and satisfaction for its customers. (Silkor.com, 2014)
2.5-Ambiance:
Silkor centers are the company's trademark. Each occupying approximately 600 square meters,
with an average of 17 treatment rooms and clinics, they are situated in prime locations and are
Characterized by a unique architecture and subtle design features.

The soothing graduated colors utilized throughout the facility, along with its peaceful Zen
ambiance, create an oasis of calm for customers arriving at the centers. Management's attention
to detail, its response to customer needs, the successful integration of technical efficiency,
Medical safety and customer comfort make the Silkor experience safe and exhilarating.
(Silkor.com, 2014)
2.6-Innovation:
Scientific and technological innovations in laser medico-aesthetic treatments are advancing at
the Speed of light.
With a dedicated medical advisory team charged with exploring new Technologies, Silkor
continuously evaluates new therapies, equipment and procedures to ensure Best results’ and
value for its clients. Thanks to Silkor's size and reputation and its relationships with
manufacturers and researchers, its team is in a position to evaluate new laser medico-aesthetic
technologies even before they come on the market. This puts Silkor in a prime position to stay
ahead of the field and provide the best service and satisfaction for its customers. (Silkor.com,
2014)
2.7-The overall market:
In 1997 the laser hair removal market size was 2$ million. In 2009 the market was
estimated to be 54 $ million and growing at 15 % per year. Between the mid 90's and 2009
the Lebanese hair removal has grown. Growth than slowed and the market become saturated ,
because the competitors has proliferated and in 2009 , many procedures were available ,
anyone could rent a hair removal machine even in their own home which increase the
ineffective treatments , making facility track record , staff and customer service more critical.
In the other hand location has become more important for customers, as the number of
facilities has mushroomed. Customers were not willing to travel to other are of the town.
In order to differentiate Silkor were open from 9 am to 8 pm. Peak hours were in the evening
not many other facilities stayed opened late as Silkor.
In Lebanon, it has been very difficult for leading hair removal industry players to grow their
businesses successfully by opening in multiple locations. According to Oscar Tarakjian:
"Very few operators have been able to successfully expand beyond the first facility.
Most operators in Lebanon who open a second facility typically hand it over to a daughter or
niece, and end up failing shortly after opening. Even very good single unit operators can’t
manage multiple units because they don’t have trained personnel to provide consistent

service, systems in place to control the operations and minimize ‘leakage’ in this cash
business, [unlike the U.S., in Lebanon and the Gulf most customers paid by cash] or the
financial or marketing abilities to compete with existing brands like Silkor". (Silkor.com,
2014)
2.8-Marketing strategy:
From the Silkor early days, billboards and advertising and PR on TV have played a major
role in increasing sales.
billboards remained were an important role in Silkor advertising strategy , Lara explained
"Billboards are there to give comfort to , and reinforce buying decisions of existing
customers, as well as to dissuade new entrants and competitors from head to head
competition".
Lara emphasized the importance of personal references: “Everyone knows us and has seen
our ads, so it’s not like they do a web search and come to us. The Lebanese tend to ask at
least 10 friends and relatives when they want to try something new. In the UAE, it’s
different: people rely more heavily on the web. Since so many people there are foreigners, the
web is their ‘friend and relative.’ (Silkor.com, 2014)
2.9-Pricing:
Silkor prices are the highest in the Lebanese market, although they have not risen
Prices since they started in 1997. The average price per session of laser hair removal
Treatment in Lebanon is $200. The average number of sessions per person is three to five.
Hair removal treatment prices for different body parts are shown below:
• Facial hair $700 to $1,000
• Underarms $500
• Bikini line $750
• Back hair $2,500
• Full legs $4,000

CHAPTER 2: LITERATURE REVIEW
In this chapter an introduction of relevant theories for the purpose of the study will take
Place.
Introduction of Chapter
Markets have become highly competitive and turbulent and are constantly changing,
Market conditions move from being simple to complex, from stable to dynamic, and
From tame to hostile (Neu and Brown, 2005). In response to changing market
Conditions, service markets have become more differentiated and innovative.
In order to fill this research, we should first understand the concept and the meaning of
service, from that point Kotler and Keller define service as "An act or performance one party
can offer to another that essentially intangible and does not result in the ownership of
anything.”(Kotler and Keller 2012, pp.356).
Furthermore Kotler explains that service is“…any activity or benefit that one party can offer
to another which is essentially intangible and does not result in the ownership of anything. Its
production may or May not be tied to a physical product.” (Kotler, 1996).
Lovelock and Wirtz give a detailed description that, “Services are economic activities
Offered from one party to another, it employs times based-performance to bring desired
results to recipients for which purchasers have responsibilities. In exchange For money, time,
and effort, services customers expect value from access to goods, Labor, professional skills,
facilities, network and systems. (Lovelock& Wirtz 2010 pp.15)
Figure 2.1: The four categories of services.
Source: Lovelock& Wirtz 2010 P.19

Kotler and Keller have also introduced 4 characteristics for services:
1-Intangibility: services cannot be seen, tasted, felt, heard, or smelled before they are bought.
2-Inseparability: services are typically produced and consumed simultaneously.
3-Variability: services are highly variable because its quality depends on who provides them,
when and where, and to whom.
4-Perishability: services cannot be stored.
(Kotler& Keller 2011)
With few exceptions, the general approach for studying a service is totally different From
product market, and due to the Rapid changes in the market conditions, company are trying to
position themselves in a way that differentiate them from competition, and allow the firm to
achieve long-Term Growth, customer loyalty, satisfaction and innovativeness.
So what is positioning? And how can we define it? Kotler say that positioning is the Act of
designing a company offering and image to occupy a distinctive place in the Minds of the
target market. (Kotler1997)
Figure 2.2: Brand positioning.
Source: Kotler &Keller 2011, p.280.
Quality
Price
Brand A
B
C
DE
F
G

Levitt introduced that Positioning is the result of differentiation decisions. It is the act of
designing the Company's offering and identity (that will create a planned image) so that they
occupy a meaningful and distinct competitive position in the target Customer's minds. (Levitt
1980, p.130).
The Ad agency Innis maggiore define Positioning as the process by which a brand (a
Product or service) is marketed with the goal of owning a meaningful and differentiated idea
in the mind of the target market. Innis maggiore Ad agency (2014)
Arnott also said that positioning is the deliberate, proactive, iterative process of
Defining, measuring, modifying and monitoring consumer perceptions of a marketable
object…"(Arnott 1993).
Another definition for Positioning” or “position” refers to a company’s or products Perceived
or desired status in a chosen market space, whether consciously chosen, Crafted, and created,
or not. (Hale marketing communication (2008)).
As a result the main objective of positioning is to allow in-depth exploration of mechanisms
related to how well the company products and Services are perceived by customers, and how
the firm can achieve a competitive advantage over the competition.
Recently, the competition cutting into the firm marketplace is affecting the company
position, so according to the basic principles of marketing, in order for the company to
achieve an effective position, the position should be:
 Meaningful to consumers.
 Credible/believable.
 Unique to your brand.
 Durable over time.
Hitesh Bhasin (2012) suggested that Products and services are created to solve Customer
“problems” (to satisfy needs and Wants) and provide benefits.
So for effective positioning, a service must meet the benefit the customer will receive, create
the expectation, and it offers a solution to the customer’s problem. If at All possible, the
solution should be different from and better than the competition solution, especially if the
competitors are already offering a similar solution.
Positioning should be a single-minded concept, an umbrella from which everything in the
organization flows.

Effective Positioning also affects policies and procedures, employee attitudes, Customer
relations, complaint handling, and the myriad of other details that combine to make a
different experience. Services companies compete on more than just image, differentiation
and benefits offered, there must be a consistency among the various Offerings and it is the
positioning statement that guides this consistency. There are two tests of effective
positioning:
 First, the position must be believable in the customers mind.
 Second, the service must deliver that promise on a consistent basis.
Hitesh Bhasin also suggested that even when the principles of positioning are understood,
there are a variety of Impediments to their successful implementation. At times, effective
positioning is undermined by the poor selection of benefits to feature in advertising.
In other Instances, advertising are compromised by the failure to sustain a brand position. .
Once a position is developed, most of the activity is directed toward sustaining it in a
contemporary way. (Hitesh Bhasin, 2012).
From lovelock and Wirtz point of view when competition increases in the service market, it
is more important for the service Companies to differentiate in a ways that are meaningful for
customers. In order for a firm to grow, it has to take share from its competitors, or to expand
into new markets. (Lovelock& Wirtz 2010 p.61)
In developing an effective positioning strategy a position must link both market analysis and
competitive analysis to internal corporate analysis?
The market analysis focus on the overall level of demand and geographic location of
Demand, and look into the size of different market segments, plus it understand customer
needs and how they perceive competition.
The competitor analysis understands competitor’s strength and weaknesses and anticipates
responses to the positioning strategies.
The internal corporate analysis identify the organization resources, goals and values,
Plus it selects limited number of target segments to serve. (Lovelock&Wirtz 2010 p.70).

Figure 2.3: Effective positioning strategies.
Source: Lovelock& Wirtz 2010, p.71.
Furthermore Kotler and Keller said that positioning requires that marketers define and
communicate similarities and differences between their brand and its competitors:
1. Determine a frame of reference by identifying the target market and relevant
competition.
2. Identify the optimal points of parity and points of difference brand associations given
that frame of reference
3. Create a brand mantra to summarize the positioning and essence of the brand
(Kotler& Keller 2011, p 280)
In the Principles of positioning strategies, Jack trout suggested that after segmenting the
market, and understanding the attributes of services level, the next step is determining the
best position of a service in the market. The competitive positioning strategy is based on
establishing a distinctive place in the market.

The essence of positioning fall into four major principles:
1- A company must establish a position in the mind of target customer.
2- The position must be singular, and provide one simple and consistent message.
3- The position must set a company apart from competition.
4- A company cannot be all things to all people; it must focus its effort.
Understanding the principles of positioning is the key of developing an effective competitive
image. (Jack trout, cited in Lovelock&Wirtz 2010, p 68.)
Figure 2.4: Principles of positioning.
Source: Lovelock& Wirtz, 2010, p.69.
We can see from this figure that the principles of positioning fall under the changes that can
make the company better than competitors, how the services/products are differentiated from
competition, and how the firm stands in the mind of customers.
The position must be well perceived by customers, and must satisfy their needs, but for many
years' companies have done a lot of mistakes and errors to achieve these objectives.

Positioning errors, according to Philip Kotler fall into four categories:
1. under positioning: Market only has a vague idea of the product.
2. Over positioning: Only a narrow group of customers identify with the product.
3. Confused positioning: Buyers have a confused image of the product as it claims too many
benefits or it changes the claim too often.
4. Doubtful positioning: Buyers find it difficult to believe the brand’s claims in view of the
product’s features, price, or manufacturer. (Kotler, 1997).
Kotler also introduced six strategies for positioning, by which a company can categorize its
position.
1. Attribute positioning: The message highlights one or two of the attributes.
2. Benefit positioning: The message highlights one or two of the benefits to the customer.
3. Use/application positioning: Claim best for some application.
4. User positioning: Claim the best for a group of users. (Children, women, working
women…)
5. Competitor positioning: Claim that the service/product is better than a competitor.
6. Quality/Price positioning: Claim best value for price. (Kotler, 1997).
The main objective of this research is to examine the fifth categories of positioning, the
competitor positioning, claiming that services and products are better than competitors,
furthermore to identify the quality and price positioning where the company can claim the
best value for price.
Hitesh Bhasin proposed that companies today apply various positioning techniques in market
so that they are Always Ahead in competition.
Some of the techniques used for positioning are, first the perceptual mapping a technique to
represent what people think about products or services.
It is a spatial representation of the perceptions about the brands on the parts of different
individuals.
If you perceive the brands to be similar then you are getting them closer in the perceptual
space, and if you perceive them to be dissimilar then you are putting them apart. In short,
that represents both brands and people.
When the environment is turbulent it changes fast and calls for frequent changes in
positioning.

At times a company can lose its position due to change in technology, consumer attitudes,
and competitive activity both in the economy and amongst creative executives.
That is the reason why a company should be in Touch with the market place, and Reposition
itself before it suffers in terms of image and revenue. (Bhasin, 2013) Perceptual maps are
normally used for two purposes:
 To identify unknown dimensions that affect customer behavior
 To comparatively evaluate competing brands when dimensions are unknown
. (Hitesh Bhasin, 2013).
Figure 2.5: Perceptual map.
Source: ICS, 2012.
The second techniques used is Positioning to specific segments; which involves Sacrifice a
few segments of the market. We cannot afford to give ‘all things to all people.’ Positioning is
to decide who our Competitors are. Then there is a need to develop a Core strategy that runs
as a common Thread through all pieces of planning.

Core strategy basically tells us why customers buy our product and how we shall compete
with others. Different segments need Different core strategies. Core strategy is broader than
USP because it considers both External and internal factors. (Hitesh Bhasin, 2013)
After these two techniques the company has to communicate, Communication helps the
marketer to builds up an image of the business.
Image build up is influenced by the effectiveness of the Communication than by the
communication budget. Most of the organization creates Value through this offer.
When discussing about the total marketing budget it is spent on advertising, sales
promotion, sales management and distribution acts basically to enhance the value created by
the offer, and accordingly they delivers the same value to the customer. These are in fact
marketing support activities. By this they are trying to market the offer in an attractive
manner to their marketing intermediaries and customer.
All of us know that a products/service has attributes and features. But these must be related
to Perceived benefits preferences and selection. (Bhasin, 2013)
Philip Kotler said also in the communication process that once the company has developed a
clear positioning Strategy, the company must choose various signs and cues that buyers use
to confirm that the product delivers the Promise made by the company. (Kotler, 1997).
Positioning is not a simple matter, at time a company can lose its position due to the
competitive activity, so in the process of positioning a firm should first identify its
competitor's .This Step is not as simple as it seems to be. Basically there are two types of
competitors:
-Primary competitors belonging to the same product class
-Secondary competitors, those belonging to other category.
Second a firm must determine how the Competitors are Perceived and Evaluated, when the
competitors' services are used by the customers. An appropriate set of Service attributes
should be chosen. (Bhasin, 2013)
The third process for positioning is determining the competitor’s positions by determining
how different brands (including own brand) are positioned with respect to the relevant
attributes selected under the previous step.
 At this point it should be clear about what is the image that the customer has about the
various brands?
 How they are positioned in respect to each other?

 Which competitors are perceived as similar and which as different? (Hitesh
Bhasin,2013)
Fourth, a company should Analyzing the Customer's habits and behavior in a particular
market Segment.
The following questions need attention while understanding the customer and the market:
 How is market segmented?
 What role does the service play in the customer's life style?
 What really motivates the customers?
 And what habits and behavior patterns are relevant?
The segmentation question is critical. There are various approaches to segmentation but
out of all benefit segmentation is relevant here, which focuses upon the benefits or attributes
that a segment believes to be important. In order to specify that benefit segments, it is useful
to highlight the role of ‘ideal object’ as a tool. (Hitesh Bhasin, 2013)
The above four steps provide a useful backgrounds and are necessary to be conducted
before taking any decision about positioning.
After these four exercises, the following guidelines can be offered to reach a positioning
decision:
 An economic analysis should guide the decision.
 Positioning usually implies a segmentation commitment.
 If the advertising is working, the advertiser should stick to it.
 Do not try to be something, you are not.
 In making a decision on position strategy, symbols or set of symbols must be
considered. (Hitesh Bhasin,2013)
Finally, an image objective, like an advertising objective should be measurable. It is
necessary to monitor the position overtime, for that a variety of techniques that can be
employed it can be on the basis of some test and interviews which will help to monitor any
kind of change in the image.
Thus, the first four steps in the positioning process provide a useful background.

The fifth one only is taken to make the position decision. The final step is to evaluate and
measure and follow up. (Bhasin 2013).
While every company’s situation is unique, we know from long experience that there are
common criteria for a company’s success in reaching and winning a market.
Positioning strategy, by its very nature, involves your value relative to your competition.
What do you do or offer that’s better (or not as competitive) as others who offer similar
products and services? When these differences are identified, supported with proof points,
and properly merchandised your prospects will have an accurate and compelling basis to
compare your company to others.
However, there is always more to understanding your offerings that defining them in light of
competitive offers.
Companies can easily make the mistake of “over positioning” their products and services.
As there are three dimensions to establishing value propositions – what it is you do, why it’s
relevant and how it’s different–How to position and differentiate companies, marketers and
sales teams can spend too much attention on differentiations before assuring the first two
dimensions are understood. Your customers are typically most interested in getting their
problems solved. If it’s not clear how you’re going to do that, comparing yourself to your
competition (even subtly) won’t matter.
Now in comparing yourself to your competition, you have to map the development and the
movement of the competition overtime.
A useful technique to do that, is through the position map, an effective tool to visualize
competitive positioning and map the development overtime.
It is also a useful way to represent consumer perception of alternative products, the
information about a product/service can be obtained from market data, derived from ratings
by representative consumers. (Lovelock & Wirtz 2010, p.73)
On a ‘positioning map’, products and services are mapped together which allows them to be
compared and contrasted in relation to Each other.
This is the main strength of this tool. Marketers decide upon a competitive position, which
enables them to distinguish their own products from the offerings of their competition.
The marketer would draw out the map and decide upon a label for each axis. They could be
price (variable one) and quality (variable two), or Comfort (variable one) and price (variable
two). The individual products are then mapped out next to each other any gaps could be
regarded as possible areas for new products. (marketing91, 2013)

Figure 2.6: Position map
Source: Ling's cars, 2007.
As discussed earlier, the existing research looks closely, about how a service company can
position itself against the competition.
With times a company can lose its position due to change in technology, consumer attitudes,
and competitive activity both in the economy and amongst creative executives.
That is the reason why a company should be in Touch with the market place, and reposition
itself before it suffers in terms of image and revenue.
In repositioning firm may have to make change in existing position, such as:
 Revising service characteristics.
 Redefining target market segments.
 Abandoning certain products.
 Withdrawing from certain market segments.
In improving negative brand perceptions, the company should redesign the core product.
Repositioning introduces new dimensions into positioning equation that other firms cannot
immediately match. (Lovelock & Wirtz 2010 p.75).
Repositioning is the process of creating a new or modified brand, company, or product
position. (Kotler 2009).

The rationale behind the present study is the challenges that a firm could face in trying to
position themselves against the competition, in the other hand more difficulties are facing
Service Company, because positioning a service is much harder than positioning a product,
and as discussed earlier service characteristics are totally different from the manufacturing
products.
For many years the dichotomy between service and physical goods still remains.
The growing acceptance is that there are several overlaps between services and products
(Levitt, 1981), has over the years prompted concern about the issue of varying positioning
strategies for services (Rathmell, 1974; Arnott& Easingwood, 1994).
It is important to know that although the concept of positioning is equally pertinent to both
products and services (Cowell, 1989), the latter possess characteristics such as intangibility,
inseparability, perishability, heterogeneity (Bateson, 1995) and non-Standardization (Berry,
1983) which make positioning of services more difficult and challenging than positioning
physical goods (Ennew et al., 1993).
This assertion is evidence in the work of Assael (1985) who states that:
“…Positioning a service is more difficult than positioning a product because of the need to
communicate vague and intangible benefits.”
The above is supported by de Chematony and dall'Olmo Riley (1997), who claims that
Service brands are particularly different, in that they rely on employee’s actions and attitudes.
Given that employee’s actions and attitudes are stochastic, and that service characteristics are
different from those of physical goods (Bitner, 1997), it can be inferred that it is more
challenging to embark on positioning strategies in services.
The foregoing is evidence in an earlier work by Lamb and Cravens (1990), who claimed that:
…services marketing differ from goods marketing because services pose different
Marketing problems and opportunities from those faced by goods marketers…
"As positioning means different things to different people, the various terminologies
Are still “several sides of the same coin?” (Arnot 1994).
Most scholars agree that it is more difficult to position services.

They also support the idea of “tangibilizing different aspects of a company service to achieve
positioning.
Services require different positioning strategies and tactics from physical goods.
These different positioning strategies for services are based upon 3 qualities.
• Search
• Experience
• Credence
Search Qualities are known as:
Features that consumers can identify before purchasing a product, like:
• Color
• Style
• Price
• Smell
Experience qualities are known as:
Features that can only be understood after purchase or during consumption, like:
• Taste
• Wear ability
• Satisfaction
Credence qualities are known as:
Features that the consumer may find difficult to evaluate even after purchase or consumption.
• Open heart operation
• Brain surgery
• Appendix operation.
It is stated that marketers find difficulties trying to interpret services since they can be
positioned on a variety of dimensions.
Such as:
• Needs they satisfy?
• Benefits delivered
• Specific features
• Time of use
• Who uses it?
I

“Services are relatively intangible, produced and consumed simultaneously, and often less
standardized than goods. These unique characteristics of services will therefore present
special challenges for services positioning.” Berry (1980)
To try to overcome these special challenges that services provide; it has shown that services
advertisements often contain more:
• Emotional appeal
• Personalized headlines
• Symbolic representation
"Service marketers must have a good understanding of their special competitive situation to
achieve long-term competitive advantage…” Fisher (1991)
When talking about positioning, we know that it is the result of differentiation decision,
the present study interpret also the concept of differentiation strategy, as both of the terms are
relevant and cannot be separated, when we want to position our services or products, we
should differentiate it from the competitors.
From Philip Kotler point of view, differentiation means the act of designing a set of
meaningful differences to distinguish the company's offering from competitor’s offerings.
(Philip Kotler 1997).
Differentiation and positioning considerations are also relevant to each element of the
marketing mix as well as to on ground and online marketplaces. The companies should be
working toward a competitive advantage “the ability to perform in one or more ways that
competitor cannot or will not match. (Kotler and Lane, 2009)
Every brand faces the challenge of positively influencing growth, by capturing new
customers and doing it in a way to promote loyalty to a brand.
Every company seek to differentiate, the struggle for differentiation may take several
forms. (Mclnnes, 2011).
Effective differentiation can put a business (or a brand) in the top position among the
competition, but an ineffective differentiation strategy can leave a business buried in the
middle or at the bottom of the pack. (Gordon, 2005).
A successful differentiation strategy cannot be imitated by competitors, but it can bring you
great success with consumers. (Herman, 2008).

Companies can differentiate their services and products in many different ways:
Quality, service, price, distribution, perceived customer value, durability, convenience,
Warranty, financing, range of products/services offered, accessibility, production method,
reliability, familiarity, product ingredients, and company image are all differentiation
possibilities, but in general there are 5 primary market differentiation strategies:
Figure 2.7: Market differentiation strategies.
Source: Mclnnes, 2011.
1-Technology differentiation:
A new technology may provide sufficient value for differentiation. (Mclnnes, 2011)
2-Price/ quality differentiation:
The use of this method may foster a calculative behavior where customers continually shop
for the next best deal.
This in turn leads to customer churn and increased acquisition cost. (Mclnnes, 2011)
Consumer perceptions of price, quality, and value are considered pivotal determinants of
shopping behavior and product choice.

Quality can be defined broadly as superiority or excellence. By extension, perceived quality
can be defined as the consumer's judgment about a product overall excellence or superiority.
(Kotler 1997).
From the consumer's perspective, price is what is given up or sacrificed to obtain a product or
service.
The use of price as an indicator of quality depends on:
(a) Availability of other cues to quality.
(b) Price variation within a class of products.
(c) Product quality variation within a category of products.
(d) Level of price awareness of consumers.
(e) Consumers' ability to detect quality variation in a group of product.
Price is usually an indicator of quality; consumers tend to check the price of a product or
service before purchasing them, this usually determines the quality price of a product. (Kotler
1997)
Price can also be an indicator of quality, a brand might be selling several products or services
for different target markets, and consumers differentiate markets by the quality pricing of the
product.
Figure 2.8: Price/ Quality differentiation
Source: Kotler, 1997.
3-product differentiation:
This method often leads to market confusion which can paralyze customer spending.
Also, too many new things can freeze spending as consumer fear buying something that may
be quickly obsolete. (Mclnnes, 2011)

4-Customer service differentiation:
This method is more costly for the brand in that it requires the infrastructural support and
continual advertising or messaging to remind potential customers to the service offer.
(Mclnnes, 2011)
5-User experience differentiation:
Differentiation based on an emotional bond with the customer is both very powerful and
difficult.
The brand that is able to build emotional or social connections will have fiercely loyal
customers with low churn. (Mclnnes, 2011).
Figure 2.9: Brand differentiation analysis.
Source: Breindel, 2012.

Many marketers advocate promoting only one benefit in the market (market offering may
have many differentiators in Product, service, personnel, channel, and image).
Kotler (1997) mentions that double benefit promotion may be necessary, if some more firms
Claim to be best on the same attribute.
Figure 2.10: Service differentiation tools.
Source: Kotler, 1997.

Service differentiation is the extent to which a company focuses on service as its core
offering and the extent to which customers regard the organization as a service provider
(Jacob and Ulaga, 2008; Neu and Brown, 2005; Oliva and Kallenberg, 2003).
Service differentiation translates into different ways to achieve competitive advantages
through services.
Potential strategic avenues for service differentiation capture customer support services,
business consulting, integrated services, or operational service. Business consulting becomes
especially salient when strategic consultancy advice is necessary to analyze the customer’s
business and identify problems in the customer’s organization on the basis of experience
(Davies, 2004; Davies et al., 2007; Gebauer, 2008).
Following this service differentiation becomes a strategy type and emerging business logic
in manufacturing companies.
Service differentiation either has a direct effect or a moderator effect.
As a direct effect, service differentiation represents competitor orientation, which is part of
the market orientation and is possible to conceptualize as a direct effect on business
performance.
Competitor orientation involves gathering intelligence on competitors; for example,
Who the competitors are, what technologies they offer, and whether they represent an
Attractive alternative from the perspective of the target customers (Han et al., 1998).
The current understanding of service differentiation is not limited to gathering intelligence on
competitors’ service offerings.
The view of service differentiation is as a strategy type and different business logic that
manufacturing firms apply. (Davies, 2004; Fang et al., 2008; Gebauer, 2008; Oliva and
Kallenberg, 2003).
Matsuno and Mentzer (2000) Suggest conceptualizing different strategy types or business
logics as moderators.
They argue that implementing a particular strategy or business logic is essentially a process
of organizational adaptation to the market environment, in which market orientation plays a
fundamental role.
They hypothesize that “the relationship between market orientation and economic
performance is moderated by the type of strategy employed” (Matsuno and Mentzer, 2000, p.
3).

Their prospector strategy type, for example (companies that almost continually search for
market opportunities and regularly experiment with potential responses to emerging
environmental trends), strengthens the positive association among market orientation, market
share, sales growth, and percentage of new product sales (Matsuno and Mentzer, 2000).
Transferring their proposition to the present context means that service differentiation is a
planned pattern of adaptations with a particular set of business performance goals.
Strategy typology literature (Hambrick, 1984) suggests three relevant arguments for the
moderator effects of service differentiation. Firstly, a manufacturing company chooses its
service differentiation on the basis of its understanding of the business environment.
Secondly, a chosen service differentiation directs a company’s attention to certain
performance dimensions (service revenue or profit).
Thirdly, a company exceeds its existing performance levels by employing various activities
that enhance and/or reduce customer centricity and innovativeness (Matsuno and Mentzer,
2000; Miles and Snow, 1978).
The rationale behind the present study’s general hypothesized moderator effect is that
service differentiation is likely to identify and share certain relevant information regarding
the complexity of customer needs, to make decisions that are conducive to customer
centricity and innovativeness, to change the composition of business performance (revenues
attributable to the products or services). These points are important because prior empirical
studies do not provide an indication of whether the complexity of customer needs, customer
centricity, innovativeness and business performance relationships are invariant across service
differentiation.
As is the case with product differentiation, the present study interprets service differentiations
as strategy types or business logics (Gebauer, 2008; Kim and Lim, 1988 ;) rather than as an
antecedent embedded in the market orientation such as customer centricity and
innovativeness.

At the end of the theoretical part a model is being used to explain this phenomenon, the
model for positioning and differentiating is listed below:
 The basic model of positioning and differentiating in market:
At the end of this theoretical framework, a model is adopted which provide a theoretical
foundation for the study, it consist of a clear explanation about positioning and differentiating
in the market.
In marketing, "differentiation" and "positioning" are terms that mean making your product or
service stand out and appear unique compared to competitor's products.
Differentiation is often used when describing the individual product and positioning is used
when describing the brand, but both expressions essentially denote rising above competition
by highlighting the distinctive features of your product or brand.
Marketing and advertising theorists have come up with many models that work as strategic
tools when you are positioning a brand.
 Figure 2.11:The STP model
Source: Annmarie Hanlon, 2013.

The foundation of positioning theory is made of one of the most important postulates of the
science of marketing, it states that "people are extremely diverse and that a product/service
cannot be liked equally by everyone"
Referring to that postulate it is simple to define the essence of STP model: to present the
product to those consumers, who want it and are able to acquire it. The first two steps of the
STP model serve to find and define the desired consumer, and positioning serves for placing
the product in the desirable position in the minds of target consumers.
Figure 2.12: Positioning and differentiating model:
Brand integrity
Brand integrity
nb
Brand identity
Brand image
Brand identity Brand image
Source: Marketing study guide, 2013.
Positioning (being
strategy).
- Believable and
meaningful in
customer
minds.
- Deliver
promise on
consistent
basis.
- Durable over
time.
- Different from
competition.
- Value
proposition.
- Focus effort.
Differentiation (core
tactics)
- Unique product
features.
- Unique product
performance.
- Exceptional
services.
- New technologies.
- Quality of inputs.
- Exceptional skill or
experience.
- Detailed
information.
Brand (Value
indicator)

This model leads to prediction of the actual relation between positioning and differentiating
in a market it would be used as guide to explain the essence of positioning and differentiation
strategy that would help the reader to understand more the concept of this Project.
*Conclusion of the chapter:
At the end positioning is the act of designing a company offering and image to occupy a
distinctive place in the minds of the target market.
The literature review theoretically main approach is studying a service positioning and
differentiating, more than this and due to the Rapid changes in the market conditions,
company are trying to position themselves in a way that differentiate them from competition,
and allow the firm to achieve long-Term Growth, customer loyalty, satisfaction and
innovativeness.
It is the act of designing the Company's offering and identity (that will create a planned
image) so that they occupy a meaningful and distinct competitive position in the target
customer's minds.
As a result the main objective of positioning is to allow in-depth exploration of mechanisms
related to how well the company products and Services are perceived by customers, and how
the firm can achieve a competitive advantage over the competition.
So for effective positioning, a service must meet the benefit the customer will receive, create
the expectation, and it offers a solution to the customer’s problem. If at all possible, the
solution should be different from and better than the competition solution, especially if the
competitors are already offering a similar solution.
Differentiation means the act of designing a set of meaningful differences to distinguish the
company's offering from competitors Offerings.
Finally, the changes in the business logic of manufacturing companies from pure Goods
providers to service providers may occur through an emphasis on service differentiation.

PART II
THE PRACTICAL FRAMEWORK

CHAPTER 3: RESEARCH METHODOLOGY
The Third chapter introduces the research methodology applied in this project. It provides
a Description of the project's research design, data collection method, sampling procedure,
Questionnaire design, measurement techniques, reliability and validity assessment, and
Limitations faced.
Introduction:
The term methodology refers to the structured sets of procedures and instruments by which
research is conducted. It is a framework within which facts are registered, documented and
interpreted in a research. The two basic methodological approaches to which different studies
might naturally lend themselves are the qualitative and quantitative methods. Whilst
qualitative is more descriptive, quantitative research more often draws inferences based on
statistical procedures and often makes use of graphs and figures in its analysis (Ghauri and
Grönhaug, 2005).
In recent years, it has become common to use triangulation or both qualitative and
quantitative methods in a single research (Ghauri and Grönhaug, 2005). In this study, the
authors made use of both methods. However the quantitative approach features more. On the
other hand, the qualitative approach is needed more in the explanatory aspects of the
observed relationships in this study. Thus for example, we were interested to know why
dissatisfied customers switch or why they do not defect to other banks. This aspect of the
study was qualitatively analyzed.
1-DATA COLLECTION METHOD:
Research Method:-A
The study was conducted by using multi- method research techniques which Involves a
mixed method the quantitative data, and qualitative data.
 The qualitative Research approach defined as "primarily exploratory research used to
gain an understanding of underlying reasons, opinions, and motivations. It provides
Insights into the problem or helps to develop ideas or hypotheses for potential
Quantitative research".

Qualitative Research is also used to uncover trends in thought and opinions, and dive deeper
into the problem. Qualitative data collection methods vary using unstructured or semi-
structured techniques". (Susan E.Wyse, 2011)
The qualitative research in this project, focused on the concept of positioning and
differentiating strategies, furthermore it explained how a company can gain a competitive
advantages over rivals, and how it can maintain the first position in customer mind over the
long run.
Qualitative research is a multi-method in focus, involving an interpretive, naturalistic
approach to its subject matter. This means that qualitative researchers study things in their
natural settings, attempting to make sense of, or interpret, phenomena in terms of the
meanings people bring to them (Newman & Benz 1998).
 The quantitative research approach, employ the survey research Method for data
Collection.
The quantitative business research approach is defined as “business research that addresses
research objectives through empirical assessment that involve numerical measurement and
analysis "In this approach, data will be examined in order to identify the relationships
between multiple variables. Quantitative research design is an excellent way of finalizing
results testing a hypothesis, and similar results will be revealed even if multiple individuals
performed the same procedure.
It is used to quantify the problem by way of generating numerical data or data that can be
transformed into useable statistics. It is used also to quantify attitudes,
Opinions, Behaviors, and other defined variables, and generalize results from larger sample
population. Quantitative Research uses measurable data to formula facts and uncover patterns
in research. (Susan E.Wyse, 2011).
Quantitative approach is one in which the investigator primarily uses post positivist claims
For developing knowledge (i.e. cause and effect thinking, reduction to specific variables and
Hypotheses and questions use of instrument and observation, and the test of theories),
Employs strategies of inquiry such as experiments and surveys and collects data on
predetermined instruments that yield statistical data (Creswell 2003).

Quantitative research is frequently referred to as hypothesis-testing research.
Characteristically, studies begin with statements of theory from which research hypotheses
are derived. Then an21experimental design is established in which the variables in question
(The dependent variables) are measured while controlling for the effects of selected
independent variables. Subject included in the study are selected at random is desirable to
reduce error and to cancel bias. The sample of subject is drawn to reflect the population
(Newman & Benz 1998).
The t-test was used also to test previously developed hypotheses. It is a statistical
examination of two population means. A two-sample t-test examines whether to samples are
different and is commonly used when the variances of two normal distributions are unknown
and when an experiment uses a small sample size. (Investopedia, 2013).
The test statistic in the t-test is known as the t-statistic. The t-test looks at the t-Statistic, t-
distribution and degrees of freedom to determine a p value (probability) that can be used to
determine whether the population means differ. The t-test is one of a number of hypothesis
tests.
Data collection tools:-B
This research includes both primary and secondary data, and the questionnaire was used as
the research method.
 The primary data were collected mainly through structured Questionnaire. The
questions were designed in an easily understandable manner that the respondent
may not have any difficulty in answering them.
 The questionnaire was conducted on Silkor customers, and the respondents were
chosen randomly of different ages, social and financial level.
Secondary data are defined as “Data that have been previously collected for some
Purpose other than the one at hand”. (Shawn Grimsley, 2010).
The secondary data were obtained through Websites, books, online magazines.
The main advantage of this type of Data is their availability, in addition to being faster and
less expensive than the primary data collection.

First of all a pilot-test was performed on 20-30 customers who were not part of the study later
on.
Pilot-testing was undertaken in order to assure readability and comprehension of the research
instrument. The second step was the approval of the questionnaire by the thesis adviser, and
then the potential respondents were located and qualified. Furthermore, the analyses of the
gathered data using several statistical methods were performed.
The t-test was used in the project for independent samples in order to test the research
Hypothesis, which will lead the researcher to answer the research question.
SPSS is a computer program used for statistical analysis. SPSS is among the most widely
used programs for statistical analysis in social science. It is used by market researchers,
health researchers, survey companies, government, education researchers, marketing
organizations and others.
The researcher used from the Descriptive statistics found in the basic software: the cross
tabulations and the Frequencies.
SPSS places constraints on internal file; structure, data types, data processing and
matching files, which together considerably simplify programming. SPSS datasets have a 2-
dimensional table structure where the rows typically represent cases (Such as individuals or
questions) and the columns represent measurements (such as age, gender or yearly family
income) only 2 data types are defined: numeric and text
All data processing occurs sequentially case-by-case through the file. Files can be matched
one-to-one and one-to-many, but not many-to-many.
The researcher implemented for each row in the variable view a question brought from the
questionnaire, the names of the questions start from Q1 and ending by Q26, the type adopted
for the questions was numeric, the width adopted was 8, there were No decimals, the label
reflected the question asked in each row, for each question There are many values, the
alignment were right, the measure were nominal and the role was input.

The data collected from the questionnaire was coded as seen in the values of each question
(raw) (refer to table ......). Then the researcher implemented the data resembled by codes or
numbers into the data view in the SPSS dataset and the program analyzed the input to
generate frequencies and cross tabulations (Analyzedescriptive
statisticsFrequencies/Crosstabs).
The researcher has done a one sample t-test for all the variables to insure the validity of the
input and the hypothesis.
C-Questionnaire:
The questionnaire was developed based on the literature review part. Its major Purpose
was to study the positioning and differentiating strategies, of how a company can
differentiate and gain competitive advantages over rivals. Several statements were proposed
for each of the studied variables.
The questionnaire involves 26 questions, the most are close ended questions, and this type of
questions provides a set of response from which an answer must be chosen.
This part considers the issue of good questionnaire design. The focus is on reliability and
validity, since these are the two criteria most widely used to determine whether or not an
instrument is usable. The ability of a questionnaire to fulfill its intended purpose of providing
useful feedback and information relating to its intended application is also considered.
Figure 3.1: Reliability and validity.
Source: (DOCSTOC, 2012).

* Questionnaire Reliability:
Reliability is the degree to which measures obtained with an instrument are consistent
measures of what the instrument is intended to measure. (James A. Pershing, 2005).Having
decided on a set of dimensions, it is then necessary to ensure that they form a reliable scale
when administered to a particular population. The most commonly used measure of reliability
is Cronbach’s alpha coefficient (e.g. Raykov and Shrout 2002).
This gives measure of the accuracy or consistency with which a set of items measures a
single construct (Miller 1995). When instruments are described in journal articles, figures for
Cronbach’s alpha are normally given. Computing these is straightforward. SPSS for example
has a procedure called ‘reliability’ (Norusis 2002).
In my questionnaire Reliability would refers to the followings:
 First, the researchers would get Similar results if they repeated the questionnaire soon
afterwards with the same respondents. And the “repeatability” of the questionnaire
would be high. This is called Test-retest reliability.
 The other aspect of reliability would be related to the consistency among the question,
because all the question relates to Silkor and differentiation, all the answers would be
fairly consistent.
So Reliability means the consistency or repeatability of the measure. This is especially
important if the measure is to be used on an on-going basis to detect Change. There forms of
reliability, in Silkor questionnaire include:
 Test-retest reliability where repeating the test/questionnaire under the same Condition
produces the same results.
 Reliability within a scale which means that all the questions designed to measures a
particular trait is indeed measuring the same trait.
To ensure the reliability of the questionnaire, a pilot test was carried out, on a few Numbers
of respondents, to ensure that the content is clear and easily answered by the respondents.
Reliability refers to random error in measurement.

Reliability indicates the Accuracy or precision of the measuring instrument (Norland, 1990),
so the pilot test was seeking to answer the question; does the questionnaire consistently
Measure whatever it measures?
1-Test-retest reliability:
Reliability is established using a pilot test by collecting data from 20-30 respondents not
included in the sample. Data collected from pilot test were analyzed and repeated after 1
week of conducting the first questionnaire with respondents and the results were the same
which can prove the (test-retest Reliability).
So the degree of stability exhibited when Silkor questionnaire is repeated under identical
conditions was high.
The test-retest reliability was proven within a short period because some variables like
happiness, satisfaction, loyalty and decisions, are likely to change within time.
2-Alternate- form reliability:
To eliminate the error that can arise from the test-retest reliability where some customers
become familiar with the questionnaire, and some of them have answered the questions
based on their memory of the latest answers. The Alternate-form reliability was used,
where I reworded some questions.
For example Question number 9:
I have reworded the question into the following:
9-How interested would you be to use other laser clinics treatments, if service prices are within your budget?
Definitelyuse 1
Probablyuse 2
Might or might not use 3
Probablynot use 4
Definetlynot use 5
9-If other laser clinics prices were low, would be intrested to try their services?
Definitely use 1
Probably use 2
Probably not use 4
Definetly not use 5

Other way used to eliminate the errors, of the questionnaire reliability is by reordering the
questions number, this way we can ensure that the responses are similar but not identical,
and can forces the respondents to read the Responses alternative carefully, which can
reduces the practice effects.
For example:
Version A:
Version B:
By having a large enough number of samples, I have split it in half and administer one
Item to each half and then compare the two halves.( Split-Halves method).
3-Internal consistency reliability:
In the internal consistency reliability I have used the Cronbach's coefficient alpha.
• Cronbach’s coefficient alpha is used to:
– Measures internal consistency reliability among a group of items combined to
form a single scale
– It is a reflection of how well the different items complement each other In
their measurement of different aspects of the same variable or quality
– Interpret like a correlation coefficient (0.70 is good). (Litwin, Mark 1995).
10-If another laser clinic of same service appears in the market with lower prices, will you prefer to stop going to Silkor?
No, not at all 1
C'ant say 2
Yes,of course 3
I may consider 4
Definetly no 1
not sure 2
Definetly yes 3
I may consider 4

Reliability Statistics
Cronbach's Alphaa N of Items
.83 36
The value is positive due to a positive average covariance among
Items. This matches the reliability model assumptions. ( 0.83>0.70)
*Questionnaire Validity:
Validity means that we are measuring what we want to measure. There are a number of
types of validity including:
 Face Validity: whether at face value, the questions appear to be measuring the
construct. This is largely a "common-sense" assessment, but also relies on knowledge
of the way people respond to survey questions and common pitfalls in questionnaire
design.
 Content Validity: whether all important aspects of the construct are covered. Clear
definitions of the construct and its components come in useful here.
 Criterion Validity/Predictive Validity: whether scores on the questionnaire
successfully predict a specific criterion.
 Concurrent Validity: whether results of a new questionnaire are consistent with
results of established measures. (Data analysis Australia, 2014).
1-Face validity:
-Cursory review of survey items by untrained judges. To determine the face validity of the
questionnaire, I have shown the questionnaire format to my friends, to see if the form looks
fine, and if the questions are phrased In an appropriate way.

2-Content validity:
-Subjective measure of how appropriate the items seem to a set of reviewers who have some
knowledge of the subject matter.
To determine the content validity of the questionnaire, I have sent a copy of it to my thesis
adviser, Dr.Sam El Nemer, who gave me an organized review of the surveys contents to
ensure that it contains everything it should and doesn’t include anything that it shouldn’t.
3-Criterion Validity:
-Measure of how well one instrument stacks up against another instrument or predictor.
To determine how well my questionnaire is compared with other measures, I have
determined if the questionnaire is:
 concurrent: assess the instrument against a “gold standard”, one way to assess this is
to give the customers two questionnaires a "gold standard «Questionnaire that's
already been validated and the new one, then I could compare the findings.
 Predictive: assess the ability of the instrument to forecast future events, behavior,
attitudes, or outcomes.
For example:
Definitely use 1
Probably use 2
Might or might no use 3
Probably not use 4
Definetly not use 5
No, not at all 1
C'ant say 2
Yes,of course 3
I may consider 4

The preceding questions can easily predict customer attitude, behaviors and outcomes in the
future.
4-Construct validity:
• Most valuable and most difficult measure of validity.
• Basically, it is a measure of how meaningful the scale or instrument is when it is in
practical use.
• Convergent: Implies that several different methods for obtaining the same information
about a given trait or concept produce similar results
• Divergent: The ability of a measure to estimate the underlying truth in a given area
must be shown not to correlate too closely with similar but distinct concepts or traits
(Litwin, Mark, 1995).
-The ability of a measure to assess correctly a particular cause and effect relationship
between the measure and some other factor.
So at final step, in establishing validity, the following questions are addressed:
1. Is the questionnaire valid? In other words, is the questionnaire measuring what It
intended to measure?
-Answer: The questionnaire is valid because it addresses the main topic of the research
(differentiating and positioning).
2. Does it represent the content?
-Answer: The questionnaire represent the content of the study, by addressing the
Different means, and variables, which can help in answering the research question.
22-How likely would you?
Definetly Probably Might or Probably Definetly
might not not not
Recommend Silkor to other 1 2 3 4 5
Re use Silkor services 1 2 3 4 5

3. Is it appropriate for the sample/population?
-Answer: The questionnaire is appropriate for the respondents, and it is easy to
understand and answer.
4. Is the questionnaire comprehensive enough to collect all the information needed to
address the purpose and goals of the study?
-Answer: the purpose and the goal of the study are to determine the ways a company can
position and differentiate itself from competition. The questionnaire is divided into
several sections that determine the competitive factors that differentiate a beauty clinic
from other and how those factors are affecting customer choices, perception and
satisfaction.
5. Does the instrument look like a questionnaire?
-Answer: appendix B
Addressing these questions coupled with carrying out a readability test enhances
questionnaire validity.
*Content Analysis:
The questionnaire consisted of seven parts. Informal interviews with respondents were
undertaken and used as an approach, when there was need to clarify the responses
indicated in the questionnaire.
 The number of question used is 26, including demographical data.
 The questions are close ended questions, this type of questions provide a set of
response from which an answer must be chosen.

1- Section one:
The first part included a general overview, of where the respondents are following
Their laser treatments, and how satisfied are they with their chosen company.
2- Section two:
The second part, was conducted on Silkor customers, by getting to know, how did
They know about the company.
This part relates mainly of determining how Silkor is positioned in their minds, and
The level of awareness they have about the company, which reflects the main topic
Of the study that discuss the positioning strategies.
1-please, Circle the company that you follow your laser treatment with?
Silkor 1
BeautySeif Clinic 2
Laser vision 3
Dermacorps 4
HMIC 5
Laser A+ 6
Other (specify)___________________ 7
2-How satisfied are you now with your chosen company?
Not at all 1
Slightly 2
Moderately 3
Quite a bit 4
Almost Totally 5
3-How did you know about Silkor?
Through advertising 1
Through friends and relatives 2
Through internet 3
Other Meduim 4

3- Section three:
The third part of the questionnaire consist of customers levels of satisfactions with
Silkor services, and treatments, by determining the main factors (quality, ambiance,
Customer services, innovation, technologies…) that affect their levels of satisfaction,
And how the treatments results meet their expectations and perceptions, this part
Mainly provide an overview of how a company can gain a "distinctive image in
Their customer minds by meeting their expectations and perceptions." It also relates
To the main topic of the study (positioning) this is defined as "the act of designing
The company's offering and identity (that will create a planned image) so that they occupy a
meaningful and distinct competitive position in the target customer's minds. This part would
also lead to answering the following research question «How could Silkor maintain a unique
position in customer’s minds in the long run?"
4- How much importance do you give to the following factors When you use Silkor services?
VI I N LI NN
1= Very important Price 1 2 3 4 5
2=Important Innovation 1 2 3 4 5
3=Normal Customer service 1 2 3 4 5
4=Least important Quality 1 2 3 4 5
5=None Promotions 1 2 3 4 5
5-How would you rate your level of Overall satisfaction with Silkor?
Extremely satisfied 1
Average satisfied 2
Satisfied 3
Dissatisfied 4
Extremely dissatisfied 5
6- How satisfied are you with the following Factors?
VI UN N S VUN NA
1= Very satisfied overall quality 1 2 3 4 5 6
2=Unsatisfied customer service 1 2 3 4 5 6%
3=Neutral Price 1 2 3 4 5 6
4=Satisfied Innovation&tech 1 2 3 4 5 6
5=very Unsatisfied Promotions 1 2 3 4 5 6
6=Not applicable Advertising 1 2 3 4 5 6
7-How would you rate the overall results of each treatment?
Very low value results 1
Middle value results 2
Very high value results 3

4- Section four:
The fourth part consist of determining how Silkor prices affects customers decisions Of
staying at the company, due to the very high treatment prices comparing to other Laser
clinics in the industry many customers were thinking of leaving Silkor, this will Reflect the
need to differentiate in order to keep a high level of market share, and not losing customers.
This part also would help in answering the research question «what should Silkor do to
differentiate itself from competition?
H2: When laser medical centers reduce their prices, customers will be drawn away from
Silkor.
5- Section five:
The Fifth part focuses on the promotions and advertising at Silkor, and the level of
attractiveness of these factors comparing to other beauty clinics. Which lead to determining
how Silkor could differentiate in terms of these variables?
H3: Competitive laser clinics promotional strategies and advertising are causing Silkor some
customer's loss.
8-According to your expectations , how would you rate Silkor Prices?
Fair 1
high 2
Very high 3
low 4
Definitely use 1
Probably use 2
Probably not use 4
Definetly not use 5
No, not at all 1
C'ant say 2
Yes,of course 3
I may consider 4

6- Section six:
The next part focuses mainly on the competitors, and how they are affecting Silkor
customer's decisions and choices, this would relates mainly to the Subtopic of this research
study "Differentiating from competitors", furthermore in answering the following research
question "What are the main competitive factors that affect consumer choices in the Laser
Beauty Industry?"
11-Which promotion offers attract you at Silkor?
Discounts 1
Extra services 2
Free products 3
Other ( specify) 4
12-Rate your overall experience due to promotion and discounts at Silkor?
Good 1
Average 2
Poor 3
13-Which media of advertisement influence your decisions?
TV 1
Brochure 2
Billboards 3
Radio 4
Internet 5
14-Does the advertisement of Silkor attract you?
Yes 1
No 2
15-Does the advertisement of other laser clinics attract you?
Yes 1
No 2
16-Rate the attractiveness of advertisement of other laser clinincs?
Very attractive 1
Attractive 2
Not at all attractive 3

H1: laser medical centers competitive new technologies and innovation are affecting
consumer perceived value, choices and decisions
H4: Competitors High quality services relates positively to affecting Silkor customer's
Loyalty and satisfaction. So this questionnaire contained statements regarding many
variables "Prices, Innovation, technologies, promotions, advertising and competition…"
Each variable was measured by several statements. Some statements in the questionnaire was
negatively worded. A Likert-like scale was presented to respondents to collect these beliefs.
The respondents were asked to respond to each statement and a continuous scale was used as
a tool of analysis, where: 5 = strongly Agree; 4 = Agree; 3 = neutral; 2 = Disagree; and.1=
Strongly Disagree.
17-What would you say about the following statements?
Strongly Agree Neutral Disagree Strongly
Agree Disagree
Silkor prices are higher than other clinics 5 4 3 2 1
Other laser clinics have more technologies and innovative services 5 4 3 2 1
18-Do you have any friends, who are following laser treatments at other clinics?
Yes 1
No 2
19-Did they recommend you of trying those clinics services?
Yes 1
No 2
20-Based on what you hear from friends, would you say that Silkor services are?
Much Somewhat About the Somewhat Much Don't
Better Better same worse worse Know
1 2 3 4 5 6
21-How likely would you?
Definetly Probably Might or Probably Definetly
might not not not
Recommend Silkor to other 1 2 3 4 5
Re use Silkor services 1 2 3 4 5

7- Section seven:
Finally the last section included the demographic part such as gender, age, education and
income. This kind of data is considered significant and contributes to a difference of
establishing whether or not they existed differences in the perceptions of the respondents,
when grouped according to their demographic characteristics.
DEMOGRAPHICS
22) Gender:
Female 1
Male 2
23) Age:
17 – 21 1
22 – 25 2
26 + 3
24) 31) Marital Status
Single 1
Engaged 2
Married 3
Divorced 4
Widowed 5
25) Household MonthlyIncome
≤ 999 1
1000 – 1999 2
2000 – 2999 3
3000 – 3999 4
4000 – 4999 5
5000 – 5999 6
6000 – 6999 7
7000 – 7999 8
8000 – 8999 9
9000 – 9999 10
≥10000 11
26) UniversityMajor :

D-Participants:
The findings reported here are based on a sample of 100 participants. Although 30
individuals were recruited for the study; in the pilot test first, 15 individuals were excluded
from the sample due to invalid or incomplete data. The characteristics of the individuals in
the total sample of 100 respondents are reported below. The sample were dominantly female
(100%) educated, from different ages and religions, who wants to take care of their beauty at
affordable prices, and effective results.
2-STUDY LIMITATIONS:
As a matter of fact, this project has some potential limitations related to generalization of
the results.
 First the research was conducted, only in one region of the country, Tripoli
(North Lebanon), and it could take place in other more populated cities like Beirut.
 Second, some problems were faced, due to the unstable safety situation in the city,
where most of the time, there are some clashes in the area, and people were afraid to
go to their treatments.
 Third, in a rapidly changing environment, analysis of one day or one segment can
change very quickly. The environmental changes are vital to be considered in order to
assimilate the findings.
 Fourth, unawareness of respondents to the topic studied, where I had to give examples
and explanations of some English words in order to make it more meaningful to their
response.
 In the other hand, some respondents, were not cooperative at all, some of them were
Rude, and explained that they have no time to fill the questionnaire, even though that
between every treatments and other, people have to wait in the rest area their turns, so
there was a plenty of time to give responses.
 Furthermore, many interviews with the respondents was corrupted, when they hear
their turn for the treatments, and some of them were leaving without continuing their
answers, so there were a lack of data between each questionnaire and other.
 Finally, there has been an absence of cooperation from Silkor itself, when they
claimed that the manager was not in her office many times.

3-RESEARCH PHILOSOPHY:
 Research paradigm:
"A philosophical and theoretical framework of a scientific school or discipline within
which theories, law and generalization and experiments performed in support of them are
formulated» (Meriam Webster dictionary, 2007).
Figure 3.2: Research paradigm.
Source: Canada Open University, 2005.
1-Ontology: Ways of constructing reality "How things really are" and" how things really
works" (Denzim and Lincoln, 1998).
2-Epistemology: Different forms of knowledge of that reality, what nature of relationship
exists between the inquirer and the inquired? How do we know?
3-Methodology: What tools do we use to know that reality? So Ontology is the nature of
reality (Hudson and Ozanne 1988) and the epistemology can be defined as the relationship
between the researcher and the reality (Carson et al. 2001) or how this reality can be known.
Ontology
MethodologyEpistemology

Figure 3.3: Positivism and intepretivisim
Ontology Positivist Interpretivist
Nature of ‘being’/
nature of the world
Reality
Have direct access to real
world
Single external reality
No direct access to real
world
No single external reality
Epistemology
‘Grounds’ of
knowledge/
relationship between
reality and research
Possible to obtain hard, secure
objective knowledge
Research focus on
generalization and abstraction
Thought governed by
hypotheses and stated theories
Understood through
‘perceived’ knowledge
Research focuses on the
specific and concrete
Seeking to understand
specific context
Source : Carson et al. 2001, p. 6
Figure 3.4 : Ontologie model.
 Ontology:
Source: Roberto, 2012.

The term ontology concerns what is said to exist in some world, that which potentially can
be talked about. Wand and Weber (1993:220) refer to ontology as «A branch of philosophy
concerned with articulating the nature and structure of the world."
By ontology is sometimes also meant a set of terms and their associated definitions intended
to describe the world in question (e.g., Uschold, 1995:1).
 The ontological question:
 What is the form and nature of reality and, therefore, what is there that can be known
about it?
 Positivism- Quantitative Research:
There is an objective reality and we can understand it through the laws by which it is
governed.
So the ontological philosophy in my research in the positivist school is to have a direct access
to real world, in other world in the quantitative research approach. A questionnaire was
conducted on the chosen company respondent, in order to
Have an access and contact to the company customers, and to construct the reality of the
company position in their minds.
 Interpretivist-Qualitative Research:
World of knowledge created by social and contextual understanding. In other world, no direct
access to the real world.
So the ontological philosophy in the Interpretivist school is known through the research
conducted in the literature review and theoretical part, where the knowledge is determined,
through books, magazines, and websites.
So ontology is based on the ways of constructing reality, which mean «how things really
are?" the reality here is that Silkor is facing a huge competition in the business which in
many ways is affecting its position in the market, therefore Silkor should differentiate itself
from other beauty clinics, to maintain customer loyalty, and not losing its market share.

 Epistemology:
"The nature of human knowledge and understanding that can possibly be acquired through
different types of inquiry and alternative methods of investigation." (e.g., Uschold, 1995).
‘Grounds’ of knowledge/ relationship between reality and research, the reality in ontology is
determined by the need to differentiate in the market due to the huge number of competition,
in order to determine and identify this reality, a research was made both in the qualitative
approach through the research, and was proven through the quantitative research by using a
structured questionnaire.
 The epistemological question
What is the nature of the relationship between the knower or would-be knower and what can
be known?
Figure 3.5: Epistemology.
Source: Roane state community college, July 3, 2010.
So Epistemology is the grounds of knowledge, and the relationship between realities and
research.
 Positivism-quantitative research:
Employs a scientific discourse derived from the epistemologies of positivism and realism.
(Anderson, 2004).

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