One of the topics that comes up a lot in startup companies is around positioning. As in, “we need to hire a marketing consultant / guru who can help position our product.”
Positioning is super important, but it’s not something that can be done after the fact. You can’t build a boat and position it as a car. It works best if you think about how you want to position your product (and your company) before you build it.
While there is some art to all of this, at a minimum you should answer the questions:
- Who is the product for?
- What problem does it solve?
- What are the competing options customers have?
- How does your product solve the problem better than any others?
There is a huge discipline in modern product management around “jobs to be done” which can help you build a good perspective. If someone buys your product, what is the job they are hiring your product to do? This works equally well for consumer products as business products.
You must focus on how your product is the best and how you want it to evolve over time. Keep in mind “best” is in the eye of beholder. It has to matter to your buyer.
For a CIO buying a SaaS product “better” might mean:
- Fastest implementation time
- Easiest for users so there’s less training
- Most secure / least risk
- Most advanced reporting
- Integrates with the broadest range of products
When you start, you might only be better in one way. But as you build your product strategy over many releases, it’s good to continue to concentrate your strengths.
Positioning is by no means easy. But there is a template I have used many times. This came from some “bullet-proof positioning” workshops my friend and colleague Jeff Wiss ran for dozens of different companies including MySQL, Duo Security and others.
It’s based on a deceptively simple template to factually describe a product’s key attributes. Positioning written in this style is not intended to drive a tagline or creative marketing. Rather it should be used to evaluate whether your marketing is “on message” to your target audience.
Here’s the template:
To Target Market, XYZ Product is the Frame of Reference or Category that Point of Difference because Justification.
Here’s how Fed Ex’s early positioning would be described in the template:
To deadline-oriented business people, Federal Express is the overnight package delivery service that is the most reliable because of its sophisticated package tracking system.
The key point of positioning in this way is to identify a singular vector of differentiation and the supporting proof or feature. In the above example Fed Ex could show they were the most reliable by pointing to their sophisticated package tracking system. This was the proof behind “how” they were able to be more reliable. This positioning worked for Fed Ex because their customers wanted to make sure that if they sent something via Fed Ex it got there the next day. Otherwise, they would have just sent it by regular postal service.
Of course, the positioning template is not the slogan Fed Ex used in their print and television advertising. They used a creative embodiment of the position: “When it absolutely positively has to be there overnight.” Which resonated emotionally with the buyer.
However, if you start by writing the tagline, it’s almost impossible to get to clarity. Instead you will likely end up arguing over the adjectives for hours “wordsmithing” the tagline until everything sounds the same.
Here’s a second example template that illustrates Amazon’s early positioning:
To people that like to read, Amazon.com is the online bookstore that is the best place to purchase books because it has the widest selection.
The creative rendition was: The world’s largest bookstore. That’s a very focused message for people who are looking for a wide range of books they might not find at their local mall store.
Finally, here’s the positioning statement that we developed for MySQL:
For web developers and DBAs, MySQL is the world’s most popular open source database because it reduces the Total Cost of Ownership by 90%.
While the template is simple, it can take many hours to work through an exercise in positioning. Jeff and I led several such workshops when MySQL was acquired by Sun Microsystems in order to help other teams throughout the company improve their positioning. In many cases it resulted in greater clarity for the team about what their appeal was in the market place.
However, in a few cases, it became apparent that positioning alone was not going to be sufficient. I remember when we met with one of the hardware server teams. We went around and around for a long time when finally I asked what I hoped would be a question to get them enthused. I asked “How will you win?”
After a bit of hemming and hawing it was clear that no one on the team thought that they could win. Their product line had suffered from two years of delay and was far behind the competition. Commodity Intel x86 servers were destroying the traditional price/performance ratios and no one wanted to pay Sun’s premium prices for higher levels of reliability. That said, there was still an installed base who would continue to buy Sun’s servers. So we helped them focus on that. It was a grim reminder that no amount of positioning can make up for a product that is not competitive.
The most important thing about positioning is to focus your efforts on what makes your product uniquely valuable to your customers. When done right, positioning acts as your North Star to provide a clear direction in which to expand your company’s capabilities for many years.
How would you describe your company’s position using the template above? If someone goes to your home page is it obvious within 10 seconds who the product is for and who it’s not for? Is it clear how it’s better than the competition? Does everyone in the company understand your positioning?
Does your positioning stand out? Let me know by posting a comment below.