Product Positioning in 6 No-BS Steps [From 7 Real Experts]

Dec 2, 2019

One of the hardest-to-miss symptoms of poor positioning is this: Buyers do not understand what you're selling. And, because they aren't sure if they want any, you probably aren't selling all that much.In a recent conversation on the podcast--Jane Portman of Userlist.IO shared a strong product positioning definition: “Good positioning results in people going very fast from you explaining stuff to them buying stuff.”

She would know. Jane and the Userlist.IO team recently gave their product positioning an overhaul, using April Dunford’s methodology and has since seen a successful launch on BetaList and rave early reviews from customers.Jane shared with me that “We didn’t change the product at all, but it instantly became a more attractive thing in the minds of our potential customers.”Sounds great, right? But those of us trying to implement positioning for the first time usually encounter a number of challenges. April herself summarized this very succinctly: "Positioning has a positioning problem".And I get it.Over the last ten years, I’ve been on a quest to stand out. With my “Everyone Hates Marketers” podcast, in my work at Hotjar, and for clients when I ran my own agency. And this quest to stand out has led me to learn as much as I can to better understand and apply the principles of product positioning in all the work I do.Through this journey, I’ve asked a number of questions:

What is product positioning and why is it important?
What’s the difference between product positioning and brand positioning?
How are product positioning and marketing strategy different?
What are the most common product positioning traps?
And is there a repeatable product positioning process to cut through the noise?

These are the questions I set out to answer in this article, with the help of a few positioning experts.

Product Positioning. If Isn’t Marketing, What Is It?

What is Product Positioning?

Some marketers refer to product positioning as a “nice addition” to your marketing mix. Others see the positioning strategy as a "necessary evil"; something that you have to do, but struggle to see the value in.But April defines product positioning as:

Product positioning is the specific market you intend to win and why you are uniquely qualified to win it. It’s the underpinning of your go-to-market strategy and impacts everything from marketing to sales, to customer success and the product itself.

Breaking this down, product positioning should include:

Your target market
Your competitive alternatives
Your unique, differentiated value
Customer-facing narrative to weave it all together

Why is Product Positioning Important?

Internally, a strong positioning strategy and positioning statement will help orient your entire company--sales, marketing, customer success, product, engineering, leadership team--around one vision, one buyer, one competitive alternative, and a few clear values you can deliver on.And this alignment is critical because your entire business strategy will flow out of it:

Your product roadmap
Your marketing strategy
Your sales approach
Your customer success program

Marketing strategist Ulli Applebaum agrees that "Positioning is the North Star that should guide all your activities from product development to distribution strategy to communication to marketing. It drives everything the company does".

Whether You Like It Or Not, You Have a Product Positioning Strategy

Positioning strategy also helps illustrate your value to customers. When I interviewed April on product positioning, she described it as: “What is the best context we can put this thing into so that buyers understand our value?”

April has seen many companies make the same mistake: Failing to set the context deliberately; or accepting their "default positioning." And when they can't seem to let go of this "default positioning", it makes it harder for customers to see the value in their product or service.

What's The Difference between Brand Positioning and Product Positioning?

Brand positioning and product positioning are similar concepts and can be tackled with the same process. But it's not always necessary to create both. It depends on your company and the number of products you sell.For start-ups that have only one product, product positioning is the same thing as brand positioning. Your product is your brand, plain and simple.However, if you are a company that sells thousands of products (picture an eCommerce company), you can't do product positioning for each one of them. So you have to go one step higher and create overall brand positioning.

What's the Difference Between Product Positioning and Marketing Strategy?

Ulli also shared that positioning is the "what do we stand for," "how are we going to bring it to the marketplace," and "with what specific consumers."

He says that positioning is a core element of the marketing strategy, but that they aren't the same.While a marketing strategy is short-term-maybe 12 months--your positioning shouldn't change unless your company makes a considerable business strategy shift.Your positioning should be the foundation from which you can execute a marketing strategy.

5 Common Positioning Traps to Avoid

Before we get started on how to do positioning properly, let’s go over a few common positioning traps that marketers can fall into.

Positioning Trap#1: Obsessing With Competitors Instead Of Customers.

Marketers would be in better shape if they paid as much attention to their customers as they do to their competitors. And learning what their true competitive alternatives are; perhaps Excel, interns or even inertia.The issue with obsessing over your direct competitors is that it can lead you into the trap of positioning your brand only in relation to these other companies.

Positioning Trap #2: Ignoring Psychographics And Buying Behaviour.

Some marketers fall into the trap of thinking only about demographics and firmographics, while completely ignoring psychographics and buying behaviour.Why is this wrong? When I interviewed Claire Suellentrop, she shared why demographics and firmographics don’t tell the whole story:

Let’s say HR Sally, she has a Honda and she has two kids and she lives in the Suburbs and she’s middle-aged and she loves tennis, and she loves dogs. But based on those characteristics--do we have any idea--why she bought a certain brand of purse, or a certain brand of wine?

The answer is, not really. Nothing tells us why Sally chose to take out her credit card and make a purchase. If we’re relying only on demographics, then we’ll never know what is motivating people to buy our stuff.Seth Godin calls this understanding why "People like us do things like this."

Positioning Trap #3: Trying to Use Strong Positioning To Resuscitate a Weak Product.

Even the best positioning can't be used to put lipstick on a pig.For positioning to work, first you have to ensure that you have product-market fit. And then you have to make sure that if your product went away, buyers would miss it.Another related but equally dangerous trap is when there's a lack of consistency between your positioning strategy and the actual customer experience with the product. Ulli shared a great example of this:

You tell me there's this great brand of yogurts. I try it, and it tastes like shit. I'm not going to buy it again. Even if the positioning is amazing.

If your product and/or your customer experience is shit, even your best efforts at positioning will fail.

Positioning Trap #4: Fearing “Doing the Niche Thing.”

April Dunford talks a lot about the fear of “doing the niche thing” as another mindset problem that holds companies back from doing positioning properly.She says that "People are scared to do the niche thing because they think it's so small. They're like, "Oh, my God. How am I going to be a billion-dollar business? I'm only selling to investment banks.”But once you successfully win one niche, you can move onto others and eventually, you can own the whole market.One way to alleviate the fear of taking a step in a new and potentially narrower direction is by testing your positioning on potential customers as soon as possible.Andy Raskin suggests bringing your salespeople on board and updating your sales deck right away. Then, having them test the positioning to see how it lands with a few new prospects.And I say, the more people you add to the room for this discussion, the more likely you’ll fall into this trap of fearing the niche. And the less likely you are to pick the right positioning.It might feel narrow. It might feel a little risky.But once you've done the customer research and left behind your “default positioning” and your market category bias, it's time to take some fucking risks.

The Ultimate Product Positioning Process: Step-by-Step

Now that we've covered what positioning strategy is (and isn't) and a few traps to avoid, let's dig into a practical product positioning process you can use to tackle this.Below, I’ve included some essential steps in product positioning, based on recommendations from positioning experts like April Dunford and Ulli Applebaum. And most importantly--this product positioning process has been pressure-tested by myself and other marketers.

Step 1: Figure Out Who Your Ideal, Most Profitable Customers Are.

These are the ones who tend to purchase high volumes of products regularly, have purchased on multiple occasions and maybe have never contacted customer service.Understanding the demographics and psychographics of this group is a good start. But beyond developing a strong understanding of who they are, you also have to explore why they buy your product.How? As a first step, you can start to glean more about why they buy from you by talking to your customer-facing staff. You can mine data out of online reviews. And you can learn more about them by digging into purchase data in your CRM.Tip: If you can’t find people who love your product, you have a bigger problem. And you likely aren’t ready to do positioning. Re-read positioning trap #3.

Step 2: Understand The Jobs (JTBD) Your Best Customers Are Hiring Your Product/Service To Do.

Next, you need to understand which jobs these best customers are hiring your product to do. And in their own words. Best case scenario, you set up some customer conversations either on the phone or by video chat. You want to have authentic conversations with these buyers, and you need to listen for:

The situation and pain points in their lives before your product or service,
Any intense emotion or motivation that triggered the buying decision,
And the job they bought your product or service to accomplish.

When I discussed buyer personas with Adele Revella, she said that the best way to guide this conversation is to ask:

Take me back to the day when you first decided that you needed to solve this kind of problem or achieve this kind of a goal. Not to buy my product, that’s not the day. We want to go back to the day that when you thought it was urgent and compelling to go spend money to solve a particular problem or achieve a goal. Just tell me what happened.

She recommends asking buyers to reflect back on that moment, and to go as deep as they can into what changed. This gives you an opportunity to walk through every single thing they thought about as they went through the buying decision.Claire suggests breaking this down into a simple framework that answers these questions:

(image credit to Intercom)

Here’s a JTBD statement example for a fictional milkshake company:When…I am commuting to work in the morning by car.I want to... have something for breakfast that will stave off hunger pangs until lunch.So I can... focus at work without being hungry and distracted.

Step 3: Identify Your Competitive Alternatives (And Market Maturity).

Finding out if/how your prospects were solving this problem before they chose to buy from you will help you understand what your real competitive alternatives are. And this helps you know where to start with your high-level narrative.This will also give you clues about the maturity of your market. Are your potential customers problem-aware, solution-aware or product-aware?For example, a company like Pampers is operating in a saturated marketplace, where most of their buyers are product-aware; they understand that there is a product to solve their problems. As such, most of their potential buyers are likely to be using a competitor brand.On the other hand, many start-ups developing new technology will find that their potential buyers are just becoming problem-aware. And maybe today, they are solving it with Excel. Or an intern. Or by doing nothing at all. But they may not have direct competitors.Here’s an example. At Hotjar we used to think that our main competitors were other similar companies in our category. But we’ve since discovered that the most common competitive alternative our potential customers are using is Google Analytics. Since most of our buyers are only aware that they have a problem, our positioning challenge is to convince them that there is a solution out there to fix it.Ask these questions in customer interviews:

Before us, what were you using to tackle this job?
Or what would you be using to accomplish this job if you couldn’t use us?

Tip: Orient your high-level narrative to position against only one competitive alternative. Choose the one that the majority of your ideal customers are using.

Step 4: List Your Features and Benefits. Then, Bucket These into Values.

In the next step, you need to work through your list of features. For each feature, you need to identify the benefit. Then, you need to bucket these benefits into specific values.The work that Jane Portman and the Userlist.IO team is an excellent example of this step. One of its key features was user management. The benefit is that it enables customers to manage their users comfortably. And the value is that it allows them to stay on top of their user situation.

Jane also mentioned the importance of being deliberate about your "non-features."Depending on your product vision and your company values, there may be features that you should/shouldn't develop. And making these hard choices can actually help improve the clarity of your product positioning.Here’s an example.Userlist.IO chose not to create chat functionality. They made a clear decision that part of the value and the ethos of their tool is to be simple. They wanted to avoid drowning users in customer communication coming from all angles, so they chose to narrow it down to email.To help you begin to unpack the value behind your features and benefits, ask these questions in customer interviews:

Why did you choose us?
Would you miss us when we are gone? Why?

If you ask your customers directly, you won't have to guess why people give a shit about your product; you'll start to understand. And this is where the magic begins to happen.

Step 5: Decide Which Product Category you Belong In.

Next, you need to decide which product category you are going to associate your product with. This is critical because buyers have different expectations of categories.April Dunford talks about three different product positioning approaches.

Head-to-head. This is where you go after a category leader. As you can probably guess, it’s difficult, expensive and you will struggle. Imagine the Coke vs Pepsi battle. It’s never going to end.
Create a new product category. This is what Drift did: They create a new category called conversational marketing. But honestly, creating a new category can be a real bitch too.
Pick a subset of customers that really care about you and go after them. This is where you pick your own niche in an established market. It's a lot more accessible and enables you to tackle accessible chunks of a larger market, bit by bit.

Step 6: Develop a High-level Narrative Around An Emotional Trigger.

Ok, let’s recap. So far we’ve got:

=
Best customers
JTBD
Competitive alternatives
Features/Benefits/Values
Product category

But the inputs are very scientific at this stage. We still need to weave it into a narrative.Think of this way.You have the recipe and a bunch of ingredients laid out on the table: eggs, flour, milk, baking powder, sugar, and cinnamon. You're ready to cook something for your guests. But if your guests can only see the components, they won't know what you're going to bake. And if they won't know if they want any.So the next step is to transform these product positioning inputs into a digestible high-level narrative or story that buyers can understand. And honestly, it takes experience to do this.What we're still missing though, is the emotional trigger. Ulli says to "look for the energy" in the category and use that as a starting point for the story.When you're running your customer interviews, you want to listen for patterns or highly emotional moments from their experience. If you can find evidence of strong emotions--frustration, anxiety, joy, desperation-- these insights can be the kernel around which you build a story.

Product Positioning Examples

There are a number of ways of weaving these positioning inputs into a high-level narrative. How many? Twenty-six, according to Ulli. He has developed a “Positioning-Roulette" flashcard activity he uses with clients. His product positioning process can help generate a number of different narrative angles like:

Romancing the origin, or where the brand (or product) comes from. What do people associate with that? How could that be used to differentiate yourself?
Creating a sense of scarcity. What makes your product exclusive? Limited ingredients?
Torture test situation: What is the most extreme case in which your product could be used?

For example, Dyson tells their origin story around this emotional trigger: The biggest customer frustration in the vacuum category is that vacuums would inevitably lose suction. They tell the story of the scientist in the lab, who spent many years researching a technology that wouldn’t lose suction. And this narrative serves to dramatize the benefits of their powerful technology.

Positioning Statement Examples

We've talked a lot about creating customer-facing product positioning. And we’ve discussed how aligning around a positioning statement can serve to guide your company in this new direction. As long as it’s simple, makes sense to the buyers you care about AND internally, and helps you stand out from competitive alternatives, your positioning statement can take many different forms.Here are a few positioning statement examples.When I interviewed freelance writer Kaleigh Moore, she shared her own positioning statement example as a service provider:“I’m Kaleigh Moore. I’m a freelance writer that specializes in long-form blog content for software companies and e-commerce platforms.”After working through the product positioning process, Jane from Userlist.IO shared their new positioning statement example for their technology product:“Onboard and engage your users with Userlist — a customer messaging tool for SaaS companies. More efficient than building it yourself; less complex than Intercom or Customer.io.”Coca-Cola’s positioning statement example is a little more complex, but has the right building blocks: target audience, differentiator, benefit.

(image credit to ebaqdesign)

On the other hand, my positioning statement for Everyone Hates Marketers podcast is really simple: "To fight marketing bullshit."

Key Takeaways

You can’t do positioning without talking to your customers. Period.
It's critical to tackle positioning with executive buy-in and input from each functional team. Don't try to do this on your own as a marketer.
When done correctly, the outputs of positioning can drive not only your marketing strategy but your entire business strategy.
Here’s a recap of the product positioning process in 6 steps:
Step 1: Start by finding out which customers love your product or service and understand as much as you can about them. Most importantly, why they buy.
Step 2: Set up some customer conversations and use this time to explore pain points and the job they bought your product/service to accomplish.
Step 3: Next, figure out what customers used to tackle this job before they found your product/service. What does this tell you about the maturity of your market?
Step 4: Now you’re ready to map features to benefits, and then bucket those into values.
Step 5: Decide which product category you’re going to position your product within.
Step 6: And finally, you need to craft a positioning story that weaves together these elements, based on an emotional trigger from your customer research.