How to Create Positioning That Works

One of the most basic and fundamental deliverables marketing teams need to provide is positioning for both their company and solution. The right positioning establishes the target markets, competitive agenda and key messages you will put forward for your solution. If you don’t have it, salespeople say one thing, marketers say another, press releases are off target, social media efforts focus on the wrong ideas and outbound campaigns miss their mark. The fact is, if you can’t succinctly communicate your solution’s unique value consistently on all levels of your organization, and through all the marketing channels available to you, then your efforts become diluted. It makes you less effective and either makes it tougher for you to succeed against your competition or opens the door for your competition to take business away from you. This is especially true if you’re selling in a crowded marketplace. Best-in-class companies clearly know what issues they solve, how they solve them better than their competition and how to both articulate and support those messages in all areas. 

This article outlines a way to create positioning that works. Take the ideas and adapt them to your company. Many of these ideas are adopted from the proverbial bible on this topic, Positioning: The Battle for Your Mind (Al Ries & Jack Trout, 2000), which is a must read for any marketer.

In short, positioning can be summed up into five parts:

  1. Research
  2. Market Segmentation
  3. Competitive Differentiation
  4. Positioning Statement Development
  5. Education and Distribution

Research

Target Customers

This may be self evident, but you can’t position your products or services effectively if you don’t know who you are going after and why? Who are your target customers? Why would they choose your solution? What is your customer’s pain? What are their mandates, frustrations, roadblocks, etc.? Don’t be afraid to record business and emotional items. Consider both the strategic and the tactical. Once you have a list, prioritize it like your prospect would. 

Market Segmentation

Now that you understand the customer problem, it is time to decide if there is a market for solving it that is big enough to make it worth your while. It is best that this process occurs before a product is developed. Many times startups develop a technology then search for a market that the technology can fit into, only to find out there isn’t one. This process is very important when trying to justify a new product to an internal executive staff or to request funding from an external source like a VC. In most cases, the market is too big.

If your solution has the ability to span the Healthcare, Government, Entertainment and Oil and Gas markets, that doesn’t mean you should target them all. Segmentation success is many times defined by understanding what you are not going to do. Segmentation allows you to focus sales, marketing and development resources. Succeeding in one market first, establishing a beachhead and then moving to the next is a well established recipe for success (Read more in Crossing the Chasm, Geoffrey A. Moore, 1991, Revised 1999).

Competitive Differentiation

In this part of the process, you should do both an internal and external audit. I recommend developing a matrix with a feature-by-feature comparison of your solution’s key strengths and benefits against those of each competitor. Something that is often overlooked here is including the benefits of your company. Sometimes it is your service, or segment expertise (see segmentation above) that provides a real competitive differentiator.

Once you have your matrix complete, it is time to understand where your solution is strongest and where it is weak. Rank your strengths as your customer would. The top differentiators are going to be the key elements of your positioning statement. Do you have significant competitive advantages that are meaningful to your customers? If yes, you are ready to take the next step. If not, you have some work to do.

For example, can you define a smaller market segment where you are more competitive? Do you really have a product that can compete in your desired target market? If not, why? Can you make adjustments?

The Positioning Statement and Key Supporting Messages should be designed to create a desired perception in your target customer’s mind. Done correctly, it should be clear and succinct. It should play to your strengths, your target customer’s needs and your competitor’s weaknesses. It needs to be truthful and protectable over time. 

A simple format to follow includes:

  • Description of the target customer or segment
  • Description of the pain point and/or needs of this segment that our product addresses (from research phase)
  • Your solution’s name
  • The most compelling reason for a prospect to purchase your product
  • Then end with the main differentiator of your solution relative to competitors

Bad Example

For customers who need to transport people, Big Bird is a school bus that can travel at over 200 miles an hour. Unlike a Ferrari, it holds more people.

Of course this example is extreme, but it helps to easily illustrate common mistakes. In this example, while the company has defined a customer problem, it has not effectively segmented its market. Because the market is too broad (those who need to transport people), the company has no idea which customer benefit on which to focus. This, in turn, leads them to choosing speed as the key benefit and then comparing their solution to a Ferrari.

This comparison leads to additional errors. One, because the market is “transporting people,” the company needs to compete against all modes of transport. Second, because the key benefit chosen is not important for the real target market. Finally, this company has made the error of confusing posturing vs. positioning. It is doubtful that the school bus can go 200 miles per hour. They are committing to a brand promise on which they cannot deliver and one that will ultimately lead to low customer satisfaction and severely damaged credibility.

Good Example

For K-12 school superintendents and transportation managers in the contiguous United States who need to cost effectively and safely transport children to their schools, Big Bird is the safest school bus on the market. Unlike other school buses, it has the best safety record in its class and features both air bags and state of the art safety restraints.

Here we have a well defined target market: K-12 schools. This positioning excludes higher education and other commercial transport. It also allows us to target the decision makers in this well defined space with marketing efforts. Next, in researching this market, the product marketing team has discovered that safety is the number one concern of the decision makers. Luckily, the product happens to be the most competitive in this area. Big Bird has the best safety record in its class. It also has better safety restraints and air bags, both of which support its positioning as “the safest on the market.”

Now that you have a solid perception that you want to create in your prospect’s mind, how do you employ it in your marketing efforts? That is the subject of an upcoming blog post. 

What positioning have you seen that works? Have you gone through this same process?

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