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.

describe positioning as “context setting” for products. When we encounter something new, we will attempt to make sense of it by gathering together all of the little clues we can quickly find to determine how we should think about this new thing.

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

If your prospects can’t figure out what you do—quickly—they will invent a position for you, one that potentially hides your key strengths or misrepresents your value.

If you see a disconnect between how your happy customers think about your product and how prospects see it, you likely have a positioning problem.

You can’t charge a premium for a product that seems exactly like everything else on the market,

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.

Even if you do manage to capture their attention, ineffective positioning makes it hard for them to understand why they might want to buy what you’re selling.

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.

great positioning is more than just articulating your assumptions around your target market and value proposition.

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 t...

Alternatives to your product can be “hire an intern to do it,” “use a spreadsheet” or even “suffer along with the problem and do nothing.”

unique attributes could also be things like your delivery model (such as installed on-premise vs. software as a service), your business model (think Rent the Runway upending retail by leasing instead of selling special-occasion wear) or your specific expertise (perhaps you have a dozen international banks as clients and therefore understand their business better than others in the market).

Value is the benefit you can deliver to customers because of your unique attributes.

if you are a small business you don’t have an unlimited marketing budget and a giant army of salespeople. Your sales and marketing efforts have to be focused on the customers who are most likely to buy from you.

What types of customers would you focus on and why? What are the characteristics of those customers that make them more likely to buy?

Think of the market category as a frame of reference for your target customers, which helps them understand your unique value. Market categories serve as a convenient shorthand that customers use to group similar products together.

Customers need a way to make sense of the overwhelming number of products on the market. When they are presented with a new product, they will attempt to use what they know to try to figure out what it’s all about.

If you choose your category wisely, all the assumptions are working for you. You don’t have to tell customers who your competitors are. It’s assumed! You don’t have to list every feature, because it’s assumed that all products in the category have basic category functions.

Positioning a product within an established market category will help customers quickly understand your product and whether or not they should consider buying it.

Trends help buyers understand why this product is important to them right now. Trends can help business buyers understand how a product aligns with overall company priorities, making it a more strategic and urgent purchase.

Buyers also worry about disruption and will often be looking to understand new technology and capabilities that they might need to know about or take advantage of for competitive reasons.

Attributes of your product are only “unique” when compared with competitive alternatives. Those attributes drive the value, which determines who the best target customers are, which in turn highlights which market frame of reference is the best one to highlight your value.

Our best market category depends on who our target customers are and what value we can deliver. The value we deliver depends on our differentiators, which depend on what alternatives we compare our product to. But the market category also tells customers who our competitors are.

The first step in the positioning exercise is to make a short list of your best customers. They understood your product quickly and bought from you quickly. They became raving fans, referred you to other companies and acted as a reference for you. They represent the perfect type of customer you want to buy from you

If we start by laying out our unique features, we are unconsciously comparing ourselves to a set of competitors.

most of your target customers have never heard of you or your rival startups—they simply want to know how your product compares to what they use today. Customer-facing positioning must be centered on a customer frame of reference.

What positioning means and why it is important Which components make up a position and how we define each of those How market maturity and competitive landscape impact the style of positioning you choose for a product

Customers, although well-versed in their problems, are often terrible at describing them in a way that gives product creators enough nuance to make decisions.

Your opinion of your own strengths is irrelevant without proof. Some groups at this stage will list features that are either difficult to prove or really more of a benefit than a feature. “We provide outstanding customer service” is probably the most common of these, followed by “very easy to use.”

If you truly believe that your company is better at customer service, how would you go about proving that? Do you have more support people than your competitors and can you prove it? Do your support people have certifications that others don’t?

Ease of use is another “feature” that I believe is really a value. What is it about your product that makes it easier to use and how do you prove it? Do your competitors’ products require training and your product doesn’t? Can you quantify how long it takes to become proficient with your product versus alternative products?

Be broad and creative with the attributes you list. They could be a proprietary process, expertise in a special area, distribution channels, partnerships or special skills.

Features enable benefits, which can be translated into value in unique customer terms. In this step, you’ll capture the value that each of your unique attributes enables for customers. Each feature can have multiple value points, and a combination of features can provide value as well.

Group attributes that provide similar value so you can get down to a more reasonable number. The goal of this step is to see the patterns and shorten the list to one to four value clusters. It’s not uncommon for this exercise to produce just a single value point.

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.

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. Those comparisons help customers quickly figure out what your product is all about and whether or not they should consider purchasing it.

The adage “if it looks like a duck, swims like a duck and quacks like a duck, then it probably is a duck” also applies to new products.

If you have already positioned yourself in a given market, your customers will have at least attempted to place you there, even if that attempt confused them. They will naturally try to put you in markets that are close to that market.

Customers aren’t positioning experts, nor are they experts in how a market category works. Frequently they will attempt to position you in the most obvious market possible, and this market is often not the best one for highlighting your strengths.

If you are launching a new product, particularly if you are a small business just starting out, the Head to Head style is rarely a good choice. Trying to beat an established market leader at their own game is a bit like trying to out-cola Coke. It would be foolish for a small company to ever try.

If you are fighting to unseat a leader in an existing category using the currently established criteria, you’re in a battle to prove that you can beat the leader at their own game. You have to clearly demonstrate to the market that you have a superior ability to deliver, and you need to support that claim with hard evidence and undeniable facts.

If you choose to use the Head to Head style... 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.

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.

Many startups compete in established market categories and do so successfully by first breaking up the market into smaller pieces and focusing on one piece they can win.

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 are not trying to change the purchase criteria for the overall category; in fact, you will have to prove that you do a “good enough” job in those areas when compared with the category leaders. Your focus is showing that there is a subsegment of the overall category with a specific set of needs that the current category leaders are not addressing.