If you are a CEO that is lamenting slowing sales and lagging growth at your company, it’s tempting to place the blame directly at the feet of the sales team – those well-intentioned front-line soldiers who are responsible to turn your solutions into the bucks that feed the company growth.
Indeed, most CEO’s I talk to feel this way – when product and market fit is not happening with enough velocity, or visions of declaring leadership in their market are unrealized, the obstacle standing in the way is always sales.
Or is it?
Take a moment to answer these three critical questions:
If you answered yes to any of the above questions, your brand likely suffers from a more fundamental issue than your sales & marketing engine.
Instead, the problem probably lies in your market positioning.
Like any relationship that has gone astray, some soul-searching might reveal that YOU actually are the reason for the divide. In the case of your solutions, when your customers don’t understand your solution, or how it uniquely solves their problem, or how you compare to others or why they should care — it’s not them — it’s you.
The likely problem? Your market positioning is unclear.
Put simply, market positioning is how your customers view you and your solution in relation to the problem they need to solve.
Are you seen as a category leader; an obscure also-ran; or, perhaps, you’re not seen at all? Understanding this essential question requires a keen focus on positioning – an often-misunderstood, sometimes-derided process that tends to be minimized, or dismissed as marketing jargon.
But more so than just fancy marketing speak, it’s a measurement of sorts – a leading indicator of the health of your brand.
According to Geoffrey Moore, a noted expert on market dynamics, “Positioning is the single largest influence in the buying process.”
When you position your tech brand in a way customers can understand (and see your brand as a solution to their problem) you make their buying decision easy. Therefore, your goal in influencing your customer's buying decision should be to create a space in the customer’s mind which identifies your product or service as the best solution for their problem.
It starts by helping to build an organizing system for your customers in thinking about your solution and brand, relative to competing solutions. The benefactors of this work include customers, markets, investors, new recruits, and even acquiring parties.
I like to use the image of a ladder as a metaphor for how customers prioritize and evaluate solutions to their problem. Think of leading brands, and where they appear on their industry’s ladder:
These brands climbed to the top rung, and were able to command a premium, despite there being no shortage of brilliant competitors nipping at their heels.
Here's the brutal reality: if you are not No. 1, or even in the top 3-5 companies for your category, you may never show up for customers.
That’s why you need to make it easy for them to choose your brand, and minimize what I call “decision fatigue.”
Here’s what I mean: Think about all the tools customers use to stack-rank their choices -- product comparisons, requests for proposals (RFP), and competitive matrices. Where do you rank in the customer's mind? Is it even clear what you do? Are you on a ladder for your category of solutions? Why do they take you through this sometimes-laborious process? Because they don’t know where you fit, relative to alternatives.
Positioning helps you to create that ladder for your customers, so they don't have to. It shows that you are able to both identify the problem they have and distinguish yourself as the single best solution for that problem.
Think of a category as one more element in this organizing system for customers. They have a ladder inside each group or category of solutions. Think of:
Categories make it easier for customers to identify the solution you provide, and to stack-rank you on their ladder. If they have a category name and a ladder to aid in stack-ranking, making decisions becomes simpler.
This is your job: Don’t leave this to your customers or worse, your competitors.
How would you like to:
Positioning strategy can be instrumental in achieving every one of those goals.
Apart from building a thriving business, why should you care about categories? Because the companies that might buy you or invest in you care. Even if you don’t care about positioning, the companies that potentially buy you DO.
If your suitors can position your unique solution (among complementary and non-competitive brands) inside of a category or portfolio of solutions they have, you've found a hole in their offering.
Here are two recent examples of why this is so important:
Furthermore, if you are lucky to get on the radar of Gartner Research -- arguably the largest technology research firm in the world – and earn a spot on one of their Magic Quadrants, you’ll be considered one of the defining solutions for your category.
So how do you apply this thinking to your business? First, do the research on customer, competitor, and market so you understand the landscape, and where you fit. At Chief Outsiders, inside our Growth Gears 3-Step model of Insight – Strategy – Execution, this is the Insight phase. Armed with that insight, thought leaders have made it easy for you and me to build the narrative - don't feel like you need to reinvent the wheel.
In Crossing the Chasm, Geoffrey Moore recommends a template for your positioning and story:
For (target customer)
who (statement of need or opportunity)
the (product name)
is a (product category)
that (statement of key benefit – that is a compelling reason to buy).
Unlike (primary competitive alternative), our product (statement of primary differentiation).
When you go through this exercise, it is more important what you don’t say, than what you do say. Say more by saying less. For example, what is the single most important differentiator, relative to your competition, that your customer cares about?
The good news is, when properly developed, this exercise produces a powerful version of your elevator pitch. Once you think you have it, test it with customers. Now go back to the drawing board as many times as you need, and then train employees, customers, and your market to speak with one voice about your company.
If I can be of assistance to you in honing the fine edges of your positioning, please reach out. Thanks for reading.