Product positioning with regards to a competitor can be done in either of two ways.
The entrepreneur can decide to go head-to-head against another product. This positioning strategy can only be successful if the products from both providers seem to have equal clout in the market. On the other hand, going head-to-head against a competing product that has clearly consolidated a strong market position is unwise. The right product positioning strategy in this case would be to concede that yours is 'the other product'. Your advertising campaign should then play on this concession in a bid to show the market that you always want to become better.
A positioning strategy in relation to a target market is also designed and undertaken based on two scenarios. The first of these is whereby the small enterprise intends to launch a new product and being careful to ensure that the product's intended use is not wrongly interpreted in the target market. For example, a low calorie product may be wrongly interpreted as being meant for obese people while in actual fact it was intended for health-conscious people who spend time in the gym. Scenario two is actually a repositioning strategy that is deemed necessary after various aspects of the target market are altered naturally or otherwise. In this way the same product is directed to a different but related segment of the market.
A product class positioning strategy can generally be used when the entrepreneur finds the need to link or delink his/her product with a certain common class of product. It is an effective technique to use when one seeks to create a competitive advantage based on just a single design/composition difference. It is easy to distinguish a pack of salted roasted peanuts with chilies from a line of competing plain salted roasted peanuts.
A product positioning strategy based on price and quality is normally embraced when it makes sense to launch a certain product as being fit for the high end of the market. The entrepreneur may have decided to present a commonly used product in a different way/manner that makes it look classier. Pricing this item above the common market price is a sure competitive edge. For example, sharp-pointed biros are priced higher than the common type of biro.