Obviously Awesome (Positioning)


I recently finished reading the book Obviously Awesome by April Dunford.  I was interested in learning more about product marketing and this came up on a must-read list. After reading it I think it applies broadly across disciplines as product and company positioning aren't an after-thought but rather core to strategy.  The book provides the clearest explanation of how to develop your positioning strategy I've seen.  In my previous post on 7 Powers, you'll see that the first powers that all startups pursue are "counter-positioning" and/or having a "cornered resource".  So positioning is essential to company strategy.

1. What is positioning?

Positioning as Context

You can think about positioning as context as it enables people to figure out what's important (and what's not).  There are some common traps in setting the context for your product or company, including:

  • Product changed: You're stuck on the idea of what you intended to build and don't realize your product has become something else.
  • Market changed: You carefully designed your product for a market, but that market has changed.

The Five (plus One) Components of Effective Positioning

Traditional positioning templates aren't helpful because they assume you've already figured out all aspects of your positioning.  Instead, there are components that build upon each other that point to a process you can take to develop and refine your positioning.  Those are the following:

  1. Competitive alternatives: what customers would do if your solution didn't exist
    1. often just DIY (paper, spreadsheets, etc.)
    2. customers are not nearly as educated about alternatives as you are
  2. Unique attributes: the features and capabilities that you have and the alternatives lack.
    1. these are relative to alternatives (not all your features are unique)
  3. Value (and proof): the benefit that those features enable for customers
  4. Target market characteristics: the characteristics of a group of buyers that lead them to really care a lot about the value you deliver.
    1. buy quickly
    2. rarely ask for discounts
    3. tell their friends about your offerings
  5. Market category: the market you describe yourself as being part of, to help customers understand your value
    1. triggers set of assumptions about competitors, functionality, and pricing.
    2. can work for or against you.
  6. (Bonus) Relevant trends: trends that your target customers understand and/or are interested in that can help make your product more relevant right now

2. The 10-Step Positioning Process

Step 1: Understand the Customers Who Love Your Product

Identify your "best fit" customers. They understand your product quickly, bought quickly, and became raving fans. The best way to think of your product is like it's a "fishing net"; your job is to determine what type of fish it catches best.

Step 2: Form a Positioning Team

Positioning is strategic decision making as it sets direction for the entire product or company, so most of the business will be impacted.  You'll need to include the product/company GM, product management, marketing, sales, customer success, and BD in the process.

Step 3: Align Your Positioning Vocabulary and Let Go of Your Positioning Baggage

How you've positioned in the past doesn't matter. You should let go of previous positioning language and be willing to start fresh.  This is particularly important if there have been shifts in your product or shifts in the market since you last created your positioning.

Step 4: List Your True Competitive Alternatives

Particularly in new markets, your true competitive alternatives are dominated by DIY solutions (paper, spreadsheets, hiring an intern, etc.).  In established markets where you're targeting a niche or subsegment, it will likely also include the "good enough" category leading solution. Ask your best fit customers what they would identify as alternative solutions.

Step 5: Isolate Your Unique Attributes or Features

List all capabilities you have that alternatives do not. All capabilities must have proof (e.g. "best customer service" is a claim that needs proof). Focus on "consideration" rather than "retention" capabilities.  Retention is important, but positioning is primarily about new customer acquisition.

Step 6: Map the Attributes to Value "Themes"

Map your unique attributes and features to benefits and then map those benefits to values (feature -> benefit -> value).  After doing so, you'll see "value themes" start to emerge that you can cluster these into.  You'll want to target 1 to 4 value clusters to focus on in your positioning (e.g. "supports remote environments").

Example mapping from features -> benefits -> values


Step 7: Determine Who Cares a Lot (market segmentation)

Segment your market to describe who cares about these values the most. Actionable segmentation captures a list of a person's or company's easily identifiable characteristics that make them really care about what you do.  For consumers, this may be brands they own or like, stores they buy from, jobs they hold, music or entertainment preferences they have, etc.  For businesses, it might be how they sell, other products they have invested in, skills they have or don't have, etc.  Target as narrowly as you can to meet your near-term sales objectives (you can broaden targets later).

Step 8: Find a Market Frame of Reference That Puts Your Strengths at the Center and Determine How to Position It

You have a few options to find a market frame of reference, including:
  • abductive reasoning: find a market that has features and capabilities similar to your product
  • examine adjacent (growing) markets: find an adjacent market to where you've already been positioning yourself (ideally one that is growing). But keep in mind that it's only a good idea if that market makes your strengths obvious.
  • ask your customers: you can ask your customers, but it's usually not a good idea. Prospects may see you differently than customers.  Customers will only try to position you in markets that are linked frequently to their industry or job function (e.g. "analytics tool").
In general though, as you're evaluating the market you'll have three options with the following pros/cons.

Option 1: Head to Head: existing market

Pros / When to use:
  • Great when you're the leader in the market and want the market to continue to be defined the way it is.
  • Don't have to convince people the category needs to exist
  • You're the leader in the market and want the market to continue to be defined the way it is
Cons / When to avoid:
  • You're bootstrapping your business or a new entrant.
  • Market doesn't fully exist in the minds of customers (common in technology where customers are years behind where latest advancements are)
  • If there's a category, there will be many new entrants over time.  It will be very competitive.

Option 2: Big Fish, Small Pond: subsegment of an existing market

Pros:
  • rules in subsegment are different enough to give you an edge over category leader
  • subsegment needs for specific capabilities outweigh importance of general category leading features
  • easier to reach and target (list building is easier, value prop is highly targeted)
  • momentum builds quickly once you get traction (all learning can be applied to next customer, word-of-mouth referrals)
  • allows you to target adjacent markets later
Cons:
  • Have to prove that your solution is better than the "good enough" provided by category leader

Option 3: Create a New Game: market you create

Pros:
  • there has been a major shift from new technology, economic change, political forces (or some combination of these)
  • enabling technology, shift in customer preferences, and supporting ecosystem all come together at once, requiring a new way of thinking about boundaries of existing category and a new way of thinking about purchase criteria
  • payoff is massive if you're able to make this work
Cons:
  • greatest amount of "teaching" customers
  • justify why category needs to exist to begin with
  • you have to sell the market on the problem first, rather than the solution
  • teach how to evaluate solutions in the category
  • teach people why you're the best
  • must have a "why now" answer --> why didn't this exist sooner?

Step 9: Layer on a Trend (but Be Careful)

It can be helpful to layer a trend onto your positioning to highlight why your product is relevant to customers right now.  You want to combine your product strengths + market context + trend.  If your product doesn't genuinely fall in a trend, don't force it as it could confuse or off-put customers.


Step 10: Capture Your Positioning so It Can Be Shared

The positioning should be summarized and shared widely across the company as it feeds into so many different parts of the organization, including sales, product, and marketing.

Here's a document with templates from April Dunford: messaging templates.

Positioning Canvas

Captures the five key aspects of your positioning.



3. Putting Positioning into Play

Translating Your Positioning into a "Sales Story"


The sales story follows a common "pain-dream-fix" arc:
  • definition of the problem
  • how customers are attempting to solve the problem today
  • describe features of a perfect solution (i.e. "perfect world")
  • introduce your product or company and positioning
  • talk about value themes and how features enable those

Although these weren't included in the book, April Dunford has many templates (linked earlier) on her website that help translate your positioning into messaging that can be used in sales and marketing.  These are the typical artifacts that product marketing teams are responsible for creating.

Boilerplate Messaging

Approved wording that you can use when creating marketing or sales material.




Value Points Boilerplate

You'll create approved wording for the top 3 - 5 points of value for each target market (e.g. retail, banking) and each target persona (e.g. VP Sales, VP Marketing). Note that if you're a startup or doing less than $10M ARR, you should just be targeting 1 segment.  Same rule of thumb goes for buyer personas (you're likely just targeting 1 or 2). Also note that the table is organized by value theme first (rather than feature first). Buyers care about value first (likely only 1 or 2) and the features and proof points are just meant back those up.





Competitive Messaging

If comparisons to direct competitors come up frequently, it's helpful to have approved wording that can be used in external situations (sales, marketing, customer success / support).  In general though, it's best to avoid direct competitor references.




Approved Customer Assets

These are a collection of approved customer assets that can be used by sales or marketing (in campaigns, content, or other material). This is a consolidated list of assets that are customer approved.




Product Roadmap & Pricing

You'll need to review your product roadmap to ensure that you're prioritizing features to reinforce your positioning.  Similarly, you'll potentially need to adjust your pricing based on the segment or subsegment you're targeting. The same product is valued very differently by different segments, so you may be adjusting this up or down.

Tracking Your Positioning over Time

You should check-in on your positioning every 6 months or so.  In addition, there are also external changes that would trigger you to revise your positioning, including competitor movement that could weaken your position, changes in government regulations, technology shifts or advancements, and changes in customer preferences or attitudes.

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