While reading this book, I wrote down the main concepts from it. They can be useful for you if just finished listening audiobook or want to refresh knowledge.
None of the new, cool stuff works without good positioning as a starting point.
Positioning is the act of deliberately defining how you are the best at something that a defined market cares a lot about.
Positioning is a fundamental input into every tactic we execute, every campaign we launch, every piece of content we create, every sales pitch we make.
If we fail at positioning, we fail at marketing and sales. If we fail at marketing and sales, the entire business fails.
Customers need to be able to easily understand what your product is, why it’s special and why it matters to them.
Weak positioning leaves a trail — the signs are there if you know where to look.
- Your current customers love you, but new prospects can’t figure out what you’re selling.
- Your company has long sales cycles and low close rates, and you’re losing out to the competition.
- You have high customer churn.
- You’re under price pressure.
WHAT IS POSITIONING?
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 set the scene for the product.
Context allows us to make thousands of little decisions about what we should pay attention to and what we can simply ignore. Without context to guide us, we would be overwhelmed, maybe even paralyzed by choice.
Understanding something new is challenging because we don’t yet have a frame of reference. When we lack context for a product, the easiest way to create one is by starting with something we already know.
Most products are exceptional only when we understand them within their best frame of reference.
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.
Trap 2: You carefully designed your product for a market, but that market has changed.
We generally fail to consider other — potentially better — ways to position our products because we simply aren’t positioning them deliberately.
Great positioning takes into account all of 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 part of, to help customers understand your value.
- (Bonus) Relevant trends. Trends that your target customers understand and/or are interested in that can help make your product more relevant right now.
Market categories help customers understand what your offering is all about and why they should care. Trends help buyers understand why this product is important to them right now.
THE 10-STEP POSITIONING PROCESS
STEP 1. UNDERSTAND THE CUSTOMERS WHO LOVE YOUR PRODUCT
Your best-fit customers hold the key to understanding what your product is.
The first step in the positioning exercise is to make a short list of your best customers.
In the early days of a company with a single product, positioning the product and the company as the same thing is the easiest path to establishing a brand in the minds of customers, because there are simply fewer things to remember.
STEP 2. FORM A POSITIONING TEAM
A positioning process works best when it’s a team effort, ideally from across different functions within the company. Each team, from sales to marketing to customer success, can bring a unique point of view relative to how customers perceive and experience the product.
Positioning impacts every group in the organization. Consider these outputs that all flow from positioning:
- Marketing: messaging, audience targeting and campaign development
- Sales and business development: target customer segmentation and account strategy
- Customer success: onboarding and account expansion strategy
- Product and development: roadmaps and prioritization
STEP 3. ALIGN YOUR POSITIONING VOCABULARY AND LET GO OF YOUR POSITIONING BAGGAGE
In order to consider possible new ways to think about a product, we have to consciously set aside our old ways of thinking about it. To do that, we need a common positioning vocabulary.
The most important part of this step is to get agreement from the team that, although the product was created with a certain market and audience in mind, it may no longer be best positioned that way. The team needs to agree to suspend their opinions about the positioning of the product for the duration of the exercise so they can be open to new ideas.
STEP 4. LIST YOUR TRUE COMPETITIVE ALTERNATIVES
Customers don’t always see competitors the same way we do, and their opinion is the only one that matters for positioning.
The features of our product and the value they provide are only unique, interesting and valuable when a customer perceives them in relation to alternatives.
You need to create a position that highlights the unique strengths of your product as customers perceive them. To do that, you need to understand who your real competitors are in the minds of customers.
Understand what a customer might replace you with in order to understand how they categorize your solution.
STEP 5. ISOLATE YOUR UNIQUE ATTRIBUTES OR FEATURES
Strong positioning is centered on what a product does best. Once you have a list of competitive alternatives, the next step is to isolate what makes you different and better than those alternatives.
Focus on the characteristics of your product or company that drives a potential benefit — ideally those features are based on objective facts and are provable.
List as many attributes as you like at this stage. You’ll group them as you move to the next stage in the process. Focus on capturing the broader set without trying to decide what’s really important and what isn’t.
STEP 6. MAP THE ATTRIBUTES TO VALUE “THEMES”
Attributes or features are a starting point, but what customers care about is what those features can do for them.
Features enable benefits, which can be translated into value in unique customer terms.
This positioning exercise is not about highlighting every little feature and attribute that our customers love. In positioning a product, we’re taking the most critical things that make us special and worth considering, and bringing the resulting unique value to the front and center.
STEP 7. DETERMINE WHO CARES A LOT
Once you have a good understanding of the value that your product delivers versus other alternatives, you can look at which customers really care a lot about that value.
An actionable segmentation captures a list of a person’s or company’s easily identifiable characteristics that make them really care about what you do.
Target as narrowly as you can to meet your near-term sales objectives. You can broaden the targets later.
In general, the segment needs to meet at least two criteria to be worthy of focus: (1) it needs to be big enough that it’s possible to meet the goals of your business, and (2) it needs to have important, specific, unmet needs that are common to the segment.
STEP 8. FIND A MARKET FRAME OF REFERENCE THAT PUTS YOUR STRENGTHS AT THE CENTER AND DETERMINE HOW TO POSITION IN IT
You now have a good handle on your ideal prospects, your product’s unique attributes and the value those attributes can deliver. The next step is to pick a market frame of reference that makes your value obvious to the segments who care the most about that value.
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 prospects clues about what products they should compare you with, your key features, your price and your benefits.
Now you are looking to deliberately choose a market frame of reference that makes your value obvious to the folks who care about it the most. There are a few ways to go about this:
- Use abductive reasoning.
- Examine adjacent (growing) markets.
- Ask your customers (but be cautious).
The style” of positioning you choose will depend on a set of factors including the competitive landscape and your business goals. Here’s my advice on how and when to use each of them:
1. HEAD TO HEAD: POSITIONING TO WIN AN EXISTING MARKET
THE GOOD NEWS: if you position yourself in an existing market, you don’t have to teach buyers too much about the category itself and you can rely on what they already know.
THE BAD NEWS: if you rely on what buyers already know, you need to fit within their existing definition if you want to win.
Be prepared to battle against multiple competitors who will be simultaneously trying to prove they are better than you are at the currently established buying criteria, as well as others who are trying to redefine the purchase criteria to their advantage.
2. BIG FISH, SMALL POND: POSITIONING TO WIN A SUBSEGMENT OF AN EXISTING MARKET CATEGORY
You may not be able to compete with an established leader head on, but that doesn’t mean there isn’t a way for you to get a foothold in a piece of the market. Once you do, you can keep expanding your patch until you’re established enough to take on a large category leader.
The goal of the Big Fish, Small Pond style of positioning is to carve off a piece of the market where the rules are a little bit different — just enough to give your product an edge over the category leader.
You get the advantage of a well-defined category without the stiff competition.
Word-of-mouth marketing happens most naturally in tight market subsegments.
This style requires that the category is well defined and there’s a clear market leader — and you’re not it. People must understand what you mean when you talk about the category.
There needs to be clearly definable groups of customers with unique needs that are not addressed by the market leader.
Remember that you aren’t redefining the category, you are merely trying to capture a piece of it, so while you are leading with your defining features and value for your subsegment, you still have to prove that you meet the underlying basic needs common to the overall market category.
3. CREATE A NEW GAME: POSITIONING TO WIN A MARKET YOU CREATE
Because this style of positioning is so difficult, it should only be used when you have evaluated every possible existing market category and concluded that you cannot position your offering there, because doing so would fail to put the focus on your true differentiators and value.
Often a category emerges when an enabling technology, a shift in customer preferences and a supporting ecosystem manage to come together at once.
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.
This style is the most difficult because it involves dramatically shifting the way customers think, and shifting customer thinking takes a very strong, consistent, long-term effort. That means you need a certain amount of money and time to convince the market to make this shift.
STEP 9. LAYER ON A TREND (BUT BE CAREFUL)
Ideally, if a current trend helps reinforce your positioning and the value that your offerings deliver, you can use it to your advantage. Aligning with a trend can help make your offering look current and relevant, particularly for customers interested in that trend.
Describing a trend without declaring a market can make your product cool but 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.
If there’s a way to pull in trends, you should do it, but if there isn’t, it’s possible to have a very successful business without being trendy in the slightest.
STEP 10. CAPTURE YOUR POSITIONING SO IT CAN BE SHARED
Positioning on its own isn’t useful to a company. Once you have worked through your positioning, you need to share it across the organization. Positioning needs to have company buy-in so it can be used to inform branding, marketing campaigns, sales strategy, product decisions and customer-success strategy.
3. PUTTING POSITIONING INTO PLAY
As a group, once you have completed a positioning exercise, you can work through defining a story of how a salesperson would pitch the product.
The point of working through the sales story is that everyone in the discussion can agree on how the positioning translates into a pitch.” To do that, the team needs to agree on how to define the problem, current solutions, the gap and the key purchase criteria that a customer should have when looking for a solution in your market.
Once the story arc is complete, the marketing team will translate that into messaging that can be used in marketing and sales materials, for campaigns and on the website.
A change in positioning usually impacts marketing and sales first but it often has impacts well beyond that. Changing the way the company thinks about itself will usually have an impact on how product features get prioritized in the future.
Similarly, pricing reflects positioning and might need to be adjusted. There are price expectations in each market category, so getting your pricing in line with those will help reinforce that your product belongs there.
- Any product can be positioned in multiple markets. Your product is not doomed to languish in a market where nobody understands how awesome it is.
- Great positioning rarely comes by default. If you want to succeed, you have to determine the best way to position your product. Deliberate, try, fail, test and try again.
- Understanding what your best customers see as true alternatives to your solution will lead you to your differentiators.
- Position yourself in a market that makes your strengths obvious to the folks you want to sell to.
- Use trends to make your product more interesting to customers right now, but be very cautious. Don’t layer on a trend just for the sake of being trendy — it’s better to be successful and boring, rather than fashionable and bewildering.
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