In their 1981 book Positioning: The Battle for your Mind, Al Ries and Jack Trout describe how positioning is used as a communication tool to reach the mind of the target customer by being heard above the din of competing messages. It remains the definitive book on how to communicate with the greatest impact.
Positioning Starts with the Customer
Oftentimes one hears the phrase "position the product", or "product positioning." That's not quite right. Rather, a product is positioned in the mind of the prospective customer. Ad campaigns are best constructed in keeping with a single positioning statement that specifies all messaging requirements.
Basis of "positioning": Consumer's information overload
Consumers are bombarded with a continuous stream of advertising. To sort through it, the consumer's mind never considers anything that is inconsistent with the her prior knowledge or experience. Anything that seems unbelievable is discarded without applying any thought, and nearly always forgotten. This directly impacts the economics of communicating to prospects.
For example, if three firms all sell on the basis of the same claims (messages), the promotional costs of all will be much higher, all things being equal, because most of the claims will be ignored. But all things are not equal. The firm considered to be the best in that segment, usually the first market entrant, will get most of the attention. Firms claiming to be superior in ways the #1 market share firm has long claimed will be the losers.
In an over-communicated environment, the advertiser should present a simplified message, be careful to make it different from competitive messages, make sure its premise is believable, and show how it solves a problem the consumer cares about. Doing that cuts through the consumer's resistance that would otherwise discard the message.
Every firm and product line has a positioning
A critical part of "positioning" is that every firm has one: It is the image of the firm in the mind of a typical member of the target audience. It may be that, among those in the target audience, there is no awareness (i.e., zero share of mind), but "unknown" is still a positioning.
More relevant is the case where unclear messaging has left the target market confused about the firm or product. If the firm then seeks to position the firm in a clear way, by running ads, the positioning that results may or may not reflect those efforts; it depends on the effectiveness of the campaign.
Playing it safe by leaving your options open guarantees failure
"Don't put all your eggs in one basket" is a great maxim for investing. Do the same with the message to customers, and failure is guaranteed. Success is found through differentiating your brand so that it appeals to a narrow audience and then clearly defining it in your positioning statement.
It's no accident that search engine marketing focuses on finding the words that uniquely describe a firm's value proposition. Before the Web, there were market research specialists who found the shortest phrase that invoked the strongest emotions about a problem solved by a product.