Big Ideas
A brilliant deep dive into how to talk about your product to prospects (i.e. positioning). It's amazing how the labels and descriptors we use for our products and services dictate customer expectations about pricing and value. They category, the market, the target customer and the features chosen to be highlighted can all have a massive impact on a business ability to successfully communicate with their prospects.
Without changing anything about the product, by repositioning a product in the minds of the customer, a business can attached a completely different set of biases and assumptions about that product. These assumptions and biases will be there regardless and can work for or against you, therefore it's important to be aware of this and have them work for you.
Most importantly, how a product is positioned changes the customers expectations about:
- What they might buy instead of yours (competitors)
- How much it should cost
- What features it should have
Notes
What is Positioning?
- "Positioning is the act of deliberately defining how you are the best at something that defined market cares a lot about."
- "When we encounter something new, we will attempt to make sense of it by gathering together all of the little clues we can quickly find to determine how we should think about this new thing."
- "Customers need to be able to easily understand what your product is, why it's special and why it matters to them."
Positioning as Context
- "Context enables people to figure out what's important. Positioning products is a lot like context setting in the opening of a movie."
- "When customers encounter a product they have never seen before, they will look for contextual clues to help them figure out what it is, who it's for and why they should care. Taken together, the messaging, pricing, features, branding, partners and customers create context and the scene for the product."
- The Two Traps
- "Trap 1: You are stuck on the idea of what you intended to build, and you don't realize that your product has become something else."
- Positioning carries implicit meaning about
- Target buyers and where you sell
- Competitive alternatives
- Pricing and margin
- Key features
- "Trap 2: You carefully designed your product for a market, but that market has changed."
- "Most products can be positioned in multiple different markets."
- Positioning takes into account the following:
- "The customer's point of view on the problem you solve and the alternative ways of solving that problem."
- "The ways you are uniquely different from those alternatives and why that's meaningful for customers."
- "The characteristics of a potential customer that really values what you can uniquely deliver."
- "The best market context for your product that makes your unique value obvious to those customers who are best suited to your product."
The Five (plus One) Components of Effective Positioning
- Competitive Alternatives. What customers would do if your solution didn't exist.
- Unique Attributes. The features and capabilities that you have and the alternatives lack.
- Value (and proof). The benefit that those features enable for customers.
- Target Market Characteristics. The characteristics of a group of buyers that lead them to really care a lot about the value you deliver.
- Market Category. The market you describe yourself as being a part of, to help customers understand your value.
- (Bonus) Relevant Trends. Trends that your target customers understand and/or are interest in that can help your product more relevant right now.
The 10-Step Positioning Process
Step 1: Understand the Customer's Who Love Your Product
- "Your best-fit customers hold the key to understanding what your product is."
- Make a list of your best fit customers and go ask them what value they get most out of your product / service. Why do they like it.
Step 2: Form a Positioning Team
- Different parts of an organization will have different perspectives on what the product / service / company is and does.
- Positioning impacts the entire org and therefore all parts from product, sales and marketing must be present.
- Need to have leadership buy in.
Step 3: Align Your Positioning Vocabulary and Let Go of Your Positioning Baggage
- The team must have a common understanding of the goal and expected outcomes of the repositioning.
- They must know:
- What positioning means and why it's important
- Which components make up a position and how we define each
- How market maturity and competitive landscape impact the stale of positioning you choose
Step 4: List Your True Competitive Alternatives
- "The features of our product and the value they provide are only unique, interesting and valuable when a customer perceives them in relation to the alternatives."
- "Understand what a customer might replace you with in order to understand how they categorize your solution."
- "Focus on your best customers and what they would identify as alternative solutions."
Step 5: Isolate Your Unique Attributes or Features
- "List all capabilities that you have that the alternatives do not."
- "Your opinion of your own strengths is irrelevant without proof."
- "Concentrate on "consideration" rather than "retention" attributes"
Step 6: Map the Attributes to Value "Themes"
- "Features enable benefits, which can be translated into value in unique customer terms."
- Cluster values into "Themes"
Step 7: Determine Who Cares a Lot
- Of your unique values figure out which customers care most about
- Segment customers based on which values matter to them so that you can speak to them in those terms
Step 8: Find a Market Frame of Reference That Puts Your Strengths at the Center and Determine How to Position in It
- "We position our offering in a market to trigger a set of assumptions - about competitors, features and pricing - that work to our advantage. By choosing to position within a specific market, you're giving your prospect clues about what products they should compare you with, your key features, your price and your benefits. Those comparisons help customers quickly figure out what your product is all about and whether or not they should consider purchasing it."
- Market Approaches
- Head to Head: Positioning to win an existing market
- Big Fish, Small Pond: Positioning to win a subsegment of an existing market
- "You have the ability to meet the special needs of the subsegment much better than the category leader."
- Create a New Game: Positioning to win a market you create
- To credibly create a new category, you need a product that is demonstrably, inarguably new and different from what exists in other market categories."
- "Category creation is about selling the market on the problem first, rather than on your solution. If the category doesn't already exist, it means customers aren't currently aware that they have a problem."
Step 9: Layer On a Trend (but Be Careful)
- "You can layer a trend on top of your positioning to help potential customers understand why your offering is important to them right now."
- "It's always better to be a little boring than completely baffling."
- "Trends can only be used when they have a clear link to your product. Start by making the connection between your product and the market obvious."
Step 10: Capture Your Positioning so It Can Be Shared
- Product name and one line description?
- Market category (and subcategory)?
- Competitive alternatives?
- Unique attributes compared to competitors?
- Value, what value do those attributes enable for customers?
- Who cares a lot, what are the characteristics of a customer that makes them care a lot about the value?
Putting Positioning Into Play
After Positioning: What Happens Next?
- Translate positioning into a "sales story"
- Update messaging for website, sales collateral, marketing materials
- Update product roadmap and pricing
- Track positioning over time