I describe myself as a positioning expert when people ask me what I do. This usually prompts the question “What exactly do you mean by positioning?” You aren’t alone if you aren’t totally clear what positioning is all about – even senior marketers struggle to define it. This article is my attempt to make it clearer for you.

Positioning isn’t new but it’s still confusing

Positioning isn’t new. It was first introduced in 1981 with the publication of the book Positioning: The Battle for Your Mind. Remember the 80’s? You were listening to Flock of Seagulls and your hair was large. If you had been born yet that is.

Ries and Trout argued that markets were crowded with copycat products. At the same time, buyers were overwhelmed with marketing messages aimed at them. In order to break through the noise, they reasoned, companies would need to take into account their own strengths and weaknesses, then contrast them with their competitors to create a unique leadership position in the minds of customers.

That sounds pretty straightforward, but while Ries and Trout did a great job of defining positioning they didn’t give us many clues about how to actually go about doing it. In my opinion, this is the root of the confusion about what positioning is all about.

Positioning uses what people know, to help them understand what they don’t

If the goal of positioning is to create a “unique leadership position” in the minds of customers, we have to start with what’s already in their minds. Customers, when faced with something new, will try to use what they know to figure out what they don’t. The first time a customer encounters your product, they will naturally try to compare it to products they already understand to try to figure it out. Market categories play a big role here.

When you say that your product is in a market category, customers instantly know a lot about it – or at least they think they do. If I tell a prospect my product is a CRM, they will assume my competitor is Salesforce. They will assume my product has basic CRM features like being able to track contacts and opportunities across a funnel. They will also make assumptions about pricing (no more than the market leader) and the pricing model (monthly, per user).

Market Categories work for you or against you

If you do a good job choosing your market category, you have saved your marketing team a lot of work. You don’t have to explicitly say who you compete with or list out every single feature – much of it is simply assumed. However, if you choose a market category where the assumptions triggered are not true, your marketing and sales team are going to spend a significant amount of time undoing the damage your positioning has already done.

Suppose I decide to build a CRM but my differentiator is that I help the sales team collaborate on accounts. However, my product, being fairly new, lacks many basic CRM features. Positioning it as “CRM” does nothing to highlight the strengths because we don’t see collaboration as central to CRM. Calling it CRM also draws attention to the weaknesses of the product by putting it into direct contrast to Salesforce. Alternatively, positioning it in another market – Account Based Selling for example – would make the differentiated value more obvious to buyers.

How do we choose the best market category for our offering?

Almost every product can be positioned in multiple different market categories. Our challenge is to choose the best one. In order to do positioning well we are going to have to define what makes our offering different (the unique features) and better (the value those features deliver), when compared to other ways of solving the problem (the competitive alternatives), and who really cares a lot about that value (the target customer segment). We have to work through each of these four components to determine which market category will do the best job of highlighting the strengths of our solution for the prospects that are most likely to want it.

We also need to understand that the components all have a relationship to each other. If we say that a feature is different, it means we have compared it to something. The value we can deliver (derived from those features) determines who our best target segments are. The ideal market category to position our offering in is the one that best communicates our value to our target segments. It isn’t enough to determine the piece parts that make up positioning, we must also understand that they are all related to each other.

What is Positioning?

To understand positioning, we need positioning process that defines the following:

  • Positioning involves choosing a market category that makes the uniquely differentiated strengths of our offering, obvious to the customers most suited for it.
  • Choosing that market category requires that we deeply understand the true competitive alternatives to our product, the unique features our product has in comparison, the value those features enable and the characteristics of a customer that makes them really care a lot about that value.
  • We need to understand that those components have a relationship to each other. Value is only differentiated when it is contrasted with a competitor, a target segment can only be chosen once you understand what your differentiated value is, etc.

Why is positioning so important?

Positioning is the foundation of everything we do in marketing and sales. It’s an input and the starting point for messaging, copywriting, sales enablement, campaign planning, content development, sales tool development, and so much more. Everything we do in marketing and sales uses positioning as an input. I can’t build a campaign until I understand who it is for. I can’t create messages for that campaign until I understand the differentiated value we are trying to communicate.

Marketing with weak positioning is like making an omelet with rotten eggs. Your cooking technique might be perfect but nobody wants to eat what you’re serving. Weak positioning will drag down the performance of everything marketing and sales are trying to accomplish.  Strong positioning, on the other hand, is like running with the wind at your back. Everything is easier and your results in sales and marketing will show it.

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