Lecture Notes: Positioning in Tech Companies

Introduction and Context

• Grandmother Test: Often used to simplify explanations for general understanding.
• Specialized Audience: Resonance needs to be with the specific target, not general public.
• Key Positioning Strategy: Find an underserved market segment, dominate it, then expand.

What is Positioning?

• Misconceptions:
  • Positioning is not just messaging or taglines.
  • Positioning is not brand positioning; those are separate.
• Definition: Positioning defines how a product is the best at delivering value to a specific customer set.
• Importance: It sets the foundation for marketing and sales strategies.
• Context Setting: Positioning sets the context for understanding what a product is and why it matters.

Example of Effective Positioning

• Tim Horton's Muffin: A double chocolate salted caramel muffin is positioned differently from cake, affecting price, competition, and context.
  • Cake Context: Competes with desserts, higher price.
  • Muffin Context: Competes with breakfast items, lower price.
• Key Insight: Same product, different positioning affects customer perception and market context.

Common Positioning Mistakes

• Lack of Deliberate Strategy: Companies often don’t consciously position their products, leading to market confusion.
• Disconnect with Market Evolution: Products evolve but positioning may not, causing customer confusion.
• Competitive Context: Understanding and addressing assumptions about competitors are critical.

Effective Positioning Tactics

• Niche Dominance: Focus on a smaller market where the company can excel before expanding.
• Example: At Jan systems, started with CRM for investment banks before expanding to other financial services.
• Broad vs. Narrow: Narrowing focus helps dominate a niche, making it easier to sell and differentiate.

Difference Between B2B and B2C Positioning

• B2B Decision Factors: Decisions based on business case and fear of making poor choices.
• B2C Decision Factors: Often emotional, less rational, with multiple potential values.
• B2B Purchase Complexity: Involves multiple stakeholders, higher stakes, and more rational justification.

Sales and Positioning

• Sales Pitch Alignment: Importance of positioning aligning with sales pitches.
• First Calls: Initial customer reaction can indicate strong or weak positioning.
• Competitive Differentiation: Clear articulation of why pick you over competitors is essential.

Evaluating and Fixing Positioning

• Cross-functional Team: Involving marketing, sales, product, customer success, and CEO in developing positioning.
• Consistent Messaging: Ensuring messaging aligns with product capabilities and market needs.
• Assessing Effectiveness: Customer understanding and sales ease are indicators of good positioning.

Challenges in Positioning

• No Decision Competitor: The biggest competitor is often indecision due to fear of making the wrong choice.
• Emerging Markets: Requires defining new categories and educating the market.

Role of Influencers and Analysts

• Analysts like Gartner: Can influence buyer decisions, especially in established markets like databases.
• Influencer Education: Ensuring influencers understand the product and position it favorably.

Storytelling in Positioning

• Importance: Essential for B2B, needs to involve competitive context.
• Effective Storytelling: Paints the whole market picture and positions the product within it.
• Good Example: Postman's