Product positioning & brand positioning

Author
Updated on
June 19, 2024

Product Positioning and Market Maturity

Four Key Elements of Product Positioning:

1. Your Product

2. Target Customer

3. Alternatives

4. Your Differentiation

As markets evolve, these elements need to adapt. Markets typically move through three stages of maturity: immature, emerging, and mature. The distinctions between early-stage and growth-stage positioning are critical for understanding how to approach marketing, product development, team dynamics, brand building, and execution.

Stage 1: Immature Market

Scenario:

Your target customers are not engaged in remote collaboration. For example, in 2005, remote work was not common, and you were trying to promote Miro.

Challenges:

- You can't compare Miro to other remote collaboration tools (no frame of reference).

- You can't promote Miro for remote collaboration (nobody is collaborating remotely).

Strategy:

Convince people to consider remote collaboration by addressing an unmet desired outcome (e.g., enhancing team productivity and collaboration). Position remote collaboration as the best way to achieve this outcome compared to alternative methods.

Essential Elements:

1. Unmet Desired Outcome: Enhance team productivity and collaboration.

2. Activity to Consider: Remote collaboration.

3. Alternative Activities: Traditional in-office collaboration methods.

4. Differentiation: How remote collaboration (and Miro) is better than traditional methods.

In the early days of Asana, the goal was not to outdo Trello but to educate teams on the necessity of structured project and task management. Trello's efforts in promoting this new methodology were beneficial, as they helped raise awareness about the problem and potential solutions.

Naming and creating a category early on is often futile because:

1. Shared Awareness Building: In an emerging and undefined category, your so-called competitors are actually allies. They help build awareness of the problem and educate the market about the new solution. This collective effort benefits all players in the space.

2. Premature Category Naming: There's a temptation to be the first to name the category and to differentiate your product at the top of the funnel. However, at this stage, the audience is usually not aware enough of the problem or the solutions available. They likely don't even understand what your product does.

3. Unified Front: It's more effective to present your products as inevitable solutions to the problem, rather than wasting time on category names that don't resonate with the audience yet. This collaboration helps to avoid confusion and accelerates market acceptance.

4. Focus on Differentiation Later: During the sales process, when prospects recognize the need for a solution, it's crucial to articulate your differentiators. However, this should not be the focus in the early stages. 

5. Clear Communication: As the market matures, a category will naturally form. At that point, it's important to strive to lead it. In the meantime, being descriptive and clear about what your product does is more effective.

This approach highlights the importance of clarity and collective market education in the early stages of a new category.

Stage 2: Emerging Market

Scenario:

People are now engaging in remote collaboration but lack effective tools.

Challenges:

- You no longer need to convince people about the benefits of remote collaboration.

- Your competitors are categories of tools (video conferencing, email, basic document sharing).

Strategy:

Position Miro as the best tool for remote collaboration. Emphasize its superiority over other tools used for the same activity.

Essential Elements:

1. Activity: Remote collaboration.

2. Category of Tool: Visual collaboration platform (Miro).

3. Alternative Categories: Video conferencing, email, basic document sharing.

4. Differentiation: How Miro is better than other tools for remote collaboration.

Stage 3: Mature Market

Scenario:

The market understands they want to enhance team productivity through remote collaboration using a visual collaboration platform.

Challenges:

- Your competitors are other visual collaboration platforms.

- The key question is, "Why are you better than other visual collaboration platforms?"

Strategy:

Highlight Miro's unique features and benefits compared to other visual collaboration platforms.

Essential Elements:

1. Category of Tool: Visual collaboration platform.

2. Your Product: Miro.

3. Alternative Products: Other visual collaboration platforms.

4. Differentiation: How Miro is better than other visual collaboration platforms.

Example of CRM in a Mature Market:

For a new CRM targeting SaaS companies, the first question to answer is, "Why are you better than Salesforce?"

Product positioning must evolve as markets mature. Initially, focus on educating potential customers about the benefits of the activity your product supports. As the market grows, position your product as the best tool for that activity. Finally, in a mature market, differentiate your product from similar offerings. By adapting your positioning strategy to the market's maturity stage, you can effectively address customer needs and stand out from competitors.

The perspective on the interconnectedness of product and brand positioning offers a refreshing and insightful take on a subject often treated as dichotomous. The idea that positioning is an organic process where market participants make sense of various offerings is indeed compelling and aligns with the modern understanding of consumer behavior and brand perception.

Brand Positioning in the Prospect’s Mind

The reference to Ries and Trout underscores the fundamental principle that positioning is a battle for the prospect’s mind. This view emphasizes that both brand and product positioning occur simultaneously in the mental space of consumers. The perception of a brand influences the perception of its products and vice versa, creating a symbiotic relationship between the two. As AI becomes increasingly common in business, its novelty as a differentiator is diminishing. Positioning a brand solely on AI can make it indistinguishable from others.

Brand as a Framework for Expectations

The assertion that a brand helps position products by shaping expectations is particularly relevant. Consumers use brand cues to form preconceived notions about new products. For example, Apple’s established brand identity of producing high-quality, minimalist, and aesthetically pleasing devices means that new products are often received with those same expectations. This preconceived brand identity simplifies the positioning of new products, as the groundwork has already been laid by the brand’s reputation.

The Brand-Product Continuum in Tech Startups

The notion that for many tech companies, especially startups, the product is the brand until the introduction of a second product is insightful. This transition period often triggers deeper reflections on the brand's overarching identity and values. The surprise and confusion surrounding brand discussions at this juncture highlight the importance of early and clear brand definition, even when the focus seems to be solely on a single product.

Branding as Coordinated Actions

Reframing branding as a series of coordinated actions to teach the market what to expect from your products is a practical and strategic approach. This view demystifies branding, making it a more manageable and actionable process. By consistently communicating specific attributes and values through various touchpoints, a brand can effectively set and meet consumer expectations.

Simplifying Branding to Expectation and Distinction

Your two simple definitions for branding – Expectation and Distinction – are powerful tools for clarifying a brand’s strategy:

1. Expectation: Define what people should anticipate when they think of your brand. This could encompass quality, service, innovation, reliability, etc.

   - Example: "When people think of our brand, they will expect innovative solutions that simplify their daily tasks."

2. Distinction: Identify how your brand will stand out from the competition. This could involve unique features, superior customer service, a strong ethical stance, etc.

   - Example: "We will stand out by offering unparalleled customer support and sustainable products."

Building Durable Market Perceptions

Developing simple, durable definitions of expectation and distinction helps build a solid foundation for market perceptions. These perceptions aid in the seamless positioning of both current and future products. The challenge lies in creating and maintaining these definitions amidst market changes and evolving consumer preferences, but it is a crucial effort for sustaining a strong, competitive brand.

Three Key Strategies for Effective Product Positioning and Messaging

1. Understand and Segment Your Audience Ruthlessly

🎯 "Start with the audience as a smoke test of who we could be targeting." — Rob Kaminski

Knowing your audience inside out is crucial for tailoring your positioning and messaging effectively. Different segments have varied needs and challenges, so hyper-segmenting helps address these nuances accurately. For instance, messaging that resonates with manufacturing customers might not work for B2B tech. Prioritize your best-fit customers ruthlessly and personalize your approach for each segment.

Key Steps:

- Identify Core Segments: Understand the different customer segments within your target market.

- Tailor Messaging: Develop specific messages that address the unique pain points and needs of each segment.

- Prioritize Best-Fit Customers: Focus on the segments that align most closely with your product’s strengths and potential for success.

2. Map Your Positioning to the Market’s Maturity Stage

📈 "Position in the wrong spot and it leads to all sorts of problems." — Anthony Pierri

Positioning evolves based on the market’s maturity. Different strategies are required for immature, emerging, and mature markets. Tailoring your messaging to the current stage ensures that your value proposition resonates with the audience.

Key Steps:

- Identify Market Stage: Determine whether your market is immature, emerging, or mature.

- Adapt Positioning: Develop positioning strategies that align with the market’s maturity stage.

  - Immature Market: Focus on educating the audience about the activity and its benefits.

  - Emerging Market: Position your product as the best tool for the activity.

  - Mature Market: Differentiate your product from similar offerings in the market.

Example: In the episode, Anthony Pierri discusses positioning using the example of ice baths.

3. You Cannot Build a Homepage for Everyone

🏠 "Summarizing for all segments leads to a non-specific message." — Anthony Pierri

Clarity is paramount when it comes to your homepage, which is one of your most important sales assets. A clear, focused message is more effective than trying to address every possible persona. Instead, lead with a message that is most relevant to the majority of your audience.

Key Steps:

- Define Primary Audience: Identify the main segment that your homepage should target.

- Focus Messaging: Develop a clear and concise message that speaks directly to this primary audience.

- Avoid Over-Summarization: Resist the temptation to create a message that tries to address all segments, as this can dilute your impact.

Effectively positioning your product and crafting your messaging requires a deep understanding of your audience, a keen awareness of the market's maturity stage, and a focused approach to your homepage messaging. By segmenting your audience, mapping your positioning to the market’s maturity, and maintaining clarity on your homepage, you can ensure that your value proposition resonates with the right customers and drives success.

Conclusion

Your contrarian view elegantly bridges the gap between product and brand positioning, advocating for a holistic approach where brand actions consistently shape market expectations and product perceptions. This integrated strategy not only simplifies the branding process but also strengthens the market position of both the brand and its products. By focusing on clear, durable definitions of what consumers should expect and how your brand stands out, you can build a resilient and compelling brand identity that supports long-term success.

More Blogs

How to reduce customer churn?

Author
Mejo
Updated on
July 24, 2024

How to reach $1M in ARR as a b2b startup in 2024?

Author
Prenitha
Updated on
July 22, 2024