Obviously Awesome: How to Nail Product Positioning so Customers Get It, Buy It, Love It

by April Dunford

Positioning is the act of deliberately defining how you are the best at something that a defined market cares a lot about.

Customers need to be able to easily understand what your product is, why it’s special and why it matters to them.

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.

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.

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 worst part of a positioning statement exercise is that it assumes you know the answers.

These are 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.

You may worry a lot about an up-and-coming startup in your space, but your customers have likely never heard of them. In business software, the most common competitive alternative is a combination of general-purpose business software (spreadsheets, documents, presentations) and manual processes.

Your target market is the customers who buy quickly, rarely ask for discounts and tell their friends about your offerings.

Suppose your company was running out of cash and if the team didn’t close a certain amount of business by the end of the month, very bad things were going to happen.

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.

Think of your product as a fishing net. You have a theory that your net is good for catching grouper, but you haven’t fished with it yet so you aren’t certain what you might catch. At first, you’ll want to go where there are lots of different fish and see what you pull up. If you notice over time you’re pulling in a lot of tuna, not grouper, you can move to the tuna spot and do the same amount of work to get a lot more fish.

I recommend checking in on your positioning every six months or when there has been a major event that could impact the competitive landscape or the way customers perceive and evaluate solutions.