April has spent the first 25 years of her career as a startup executive, running marketing, product, and sales teams. She led teams at seven successful B2B technology startups. Most of those startups were acquired (DataMirror to IBM, Janna Systems to Siebel Systems, then SAP, Watcom to Sybase via Powersoft, to name a few), and she ran big teams at IBM, Siebel, Sybase, and others. The total of those acquisitions is more than two billion dollars. Across that journey, April has positioned, re-positioned, and launched 16 products.
1. What was it about positioning that initially drew you in and then led you to write the book on it?
In my first marketing job I was responsible for a product that was failing. We eventually did a major re-positioning and the product took off, eventually becoming the anchor product of a business unit doing hundreds of millions in revenue.
That experience opened my eyes to the power of positioning. I had always assumed there was an accepted methodology for doing positioning but after taking a lot of marketing courses and reading a ton of books, I discovered that there wasn’t an accepted way to do it.
It seemed to me that something as important as positioning should be done using a repeatable process. In my work as a VP of Marketing I eventually developed one. The book is my attempt at outlining that process so that any marketer can do it.
2. What are the main components of effective positioning?
When I first started thinking about how to create a methodology for positioning, I decided the best way to tackle it would be to break positioning down into its component pieces and then solve for those individually.
Breaking it into pieces was easy, because we agree on what those are:
- Competitive alternatives
- Differentiated capabilities
- Best-fit customers
- Market category
3. How do those component pieces come together?
When you look at the pieces, the first thing you realize is that each component has a relationship to the others. For example, the differentiated value that my product enables for customers is completely dependent on differentiated features. But those features are only differentiated when you compare them to an alternative.
The same goes for best fit customers. Our best fit customers are, by definition, the folks that care the most about our differentiated value. And our best market category is the market category that makes our differentiated value obvious to our best fit customers. So where do we start?
For two years I decided there was no obvious starting point and the best you could do was pick one, work your way through the others, and develop a “candidate positioning”. We would test that in the market and if it worked, we would run with it. If it didn’t work, we would go back to the drawing board and try again. This wasn’t an optimal way to do things because it took a lot of time and as a VP of Marketing, you only have so much time to figure this out before you risk getting fired.
I finally had a breakthrough after reading a book by Clayton Christensen. I realized that if we don’t start with competitive alternatives, we can end up with positioning that sounds good in the office but doesn’t work in the real world because it doesn’t sufficiently differentiate you from the competition. So in my methodology, we start with competitive alternates, then differentiated capabilities, value, best fit customers and lastly market category.
4. What are the telltale signs of strong or weak positioning?
The easiest sign of weak positioning is that customers just don’t really get what you do and why they should care. You will see customers asking in sales calls “So…what are you again?” You will see customers comparing you to companies that you don’t actually compete with. You might see customers that claim to understand what you do but don’t understand the value.
Strong positioning feels a bit like magic. Customers show up on sales calls and say things like “Yeah, yeah we get it already, just give me the price!” Customers understand who you compete with, and how you are better. They understand your value, rarely ask for discounts, and deals close quickly. These are the signs that your positioning is helping customers understand what you are and why they should care.
5. How much should we let trends affect our positioning or go-to-market strategy?
Aligning your product with a trend isn’t necessary for great positioning, but it can be a real accelerator. In tech, trends are often confused with market categories but they are really different. A category is something like CRM, accounting software, or marketing automation. A trend can be applied across many different market categories and can be things like machine learning, artificial intelligence, cloud computing, etc.
Trends are important because customers don’t want to be left behind. They are worried about disruption, and if suddenly they are reading a lot about AI for example, they will start worrying that they need an AI strategy to keep ahead of their competition. We want to always position our product into a market category, but we might also overlap a trend to help customers understand why the product is important right now.
One company I worked with sold database tools, which isn’t what you would call trendy but they had a great business with over 800K customers. They noticed a new trend in their buyer a few years ago called Dev Ops. The IT teams they sold to were transitioning to a new way of designing and releasing software. They looked at the trend and realized that database tools could and should play a big part in a Dev Ops transformation. They positioned their suite of tools as database tools for Dev Ops and saw a big spike in growth because customers saw how their offerings aligned with their biggest priority for the team.
6. How can you use positioning to reach prospects?
Great positioning should resonate with prospects that are a very good fit for your product and should repel bad fit customers. Once you understand who your best fit prospects are, you can really focus your marketing efforts on just those folks.
You can ask yourself – where do buyers like that hang out online and how do I reach them there? What conferences do they go to, what newsletters do they read, what influencers do they listen to, and how can I intercept them where they are? Good positioning helps narrow down the focus for marketing and sales so they can get more qualified prospects with less effort.
7. How do you ensure your positioning is believable?
I see a lot of positioning that is weak because it simply isn’t true. If you are going to claim that you can deliver some value to prospects, you have to be able to prove it to customers. And the proof can’t be “because we say so”. You need data, third party verification, statistics, or customers that prove you can do what you claim.
8. How often should companies change their positioning?
I worked on a product twenty years ago that has the same positioning today as it did back then. I also worked on a product where we shifted the positioning three times in eighteen months.
When I was working as VP of Marketing, I had a standing call on the calendar with the executive team every six months. In that meeting we would work through the positioning and ask ourselves if anything had changed. Have the competitive alternatives changed? Were there acquisitions or new entrants in the space? Next we will look at capabilities and ask if our competitors have caught up. Have we done a new release with significant new capabilities that drive new value?
If nothing had changed, the positioning shouldn’t change. If something had changed we would go back and adjust the positioning. You should also look at your positioning anytime there is a big shift in the market—COVID-19, a stock market crash, a big new entrant in your market— all are examples of a shift you might need to respond to.
9. Are there positioning or go-to-market strategies you would not recommend in the coming years?
There are some positioning strategies that are generally weak. For example, positioning around price as a differentiator is often hard to maintain, because your competitor can discount and match your price.
We tend to see positioning around helping customers make money works well in times when the economy is strong. When the economy is weak, positioning around how you can help companies save money tends to work better.
Right now we are seeing a lot of uncertainty due to COVID-19 and supply chain issues. I would advise you to stay very close to your customers to understand how their businesses are reacting to these changes and how your positioning might be impacted.
10. What are some tips for aligning and executing new market positioning?
Positioning is a team sport. Marketing should never be working on positioning in isolation. When I work with companies, we do positioning with a cross-functional team that includes sales, product, marketing, customer success, development, and the CEO. If we develop the positioning together, we can get agreement and alignment across the entire company.
11. What are the best ways to test your positioning?
Marketers often want to test positioning by creating messaging and doing an A/B test on a landing page. I don’t like that approach because I feel like there are too many variables beyond positioning we are testing: the copy, the design of the page, the quality of the traffic getting driven to that page, etc.
If you have sales people, I like to test the positioning by creating a sales pitch deck, training a single sales rep on the deck and then testing it with qualified new prospects. You will get a lot of signals in a test like this. You can see when customers are getting confused or excited and hear the kinds of questions they ask. I would keep testing the new sales deck until the sales rep tells me that the pitch works and that it works better than the old pitch. At that point I would have the rep train the other sales reps and I would then work on messaging.