Positioning Statements – The Original Essence

by David on March 13, 2010

Proper product and corporate positioning is critical for high technology companies and their marketing teams.  It sets the stage for messaging in all of its forms: PR, Web Site Design and Content IR, Advertising, Tradeshows, Collateral Materials, Presentations, Telemarketing Scripts, and Social Media. All on a single page/sheet of paper.

That’s the good news.  The bad news is that it can take concerted effort and a major investment in time from the company executive team and the marketing team to “iterate towards the truth”.

So What is a Position?

Rosser Reeves, who co-founded, and later became Chairman of the Ted Bates agency (and the model for Don Draper in Mad Men), coined the term “Unique Selling Proposition” (USP).  His idea came from research done by the agency in the early 1940s into why certain campaigns were successful and others not so much.  This was the same approach the Partners at Regis McKenna used to develop the concept of “The Chasm” and how to cross it.

His conclusions were simple:

  1. Each advertisement must make a proposition to the consumer. Not just words, not just product puffery, not just show-window advertising. Each advertisement must say to each reader: “Buy this product, and you will get this specific benefit.”
  2. The proposition must be one that the competition either cannot, or does not, offer. It must be unique—either a uniqueness of the brand or a claim not otherwise made in that particular field of advertising.
  3. The proposition must be so strong that it can move the mass millions, i.e., pull over new customers to your product.  At Regis McKenna, we called this the “Compelling Reason to Buy”.

He more thoroughly explained his ideas in his book “Reality in Advertising”, 1961.  Unfortunately, it’s out of print and used copies go for $60 and more.

It’s important to note that in FMCG markets advertising is the principal method of moving consumers along through the purchase decision process, which may only take a few weeks and often involves only a single person.  Most high technology products involve longer time frames and more influencers as we have, and will, discuss in additional posts.

The Positioning Statement

Other outlines and approaches have been proposed and are in circulation, but I like this one the best:

  • For (Target Market)
  • Who Want/Need (Compelling Reason to Buy)
  • (Company/product) is a (Category)
  • That provides (Key Benefit)
  • Unlike (Primary Competition)
  • Who/Which (Competitor’s Main Benefit)

Positioning is especially important for high technology companies because it is easy to lose focus and be swayed by your last customer, or a sales person’s last loss, or the CEO’s next great idea, or that “secret” project engineering has been working on without marketing knowledge or guidance while a critical product or improvement has been sitting on the back burner because marketing did not give enough guidance.  But that never happens … right?

How Do You Develop One?

The short answer is VERY CAREFULLY.   A positioning statement drives the overall company strategy: marketing, manufacturing, engineering, the product roadmap, sales channels and investor relations (private or public).  The first three elements are the most important.

Target Market

It is as important to identify whom IS NOT your target market, as it is to do so for your best targets.  Also, identifying the first of those targeted segments is critical.  Especially smaller companies need to be laser-focused, since you are going up against larger, more well established competitors with substantially greater resources at their disposal (as any Microsoft competitor knows all too well).

Sometimes referred to as the “Bowling Pin” strategy (your chances of knocking all 10 pins down is significantly higher when your ball hits right between the front two pins) or Beachhead Strategy, this entails finding an identifiable sub-segment of your target market that you can “own”, where other competitors will not be able to displace you very easily.  For example Silicon Graphics focused on 3D Molecular Modeling when entering the CAD/CAM market a number of years ago against IBM and DEC who dominated the workstation market because the graphics performance of SGI’s workstations was so superior.  Once successful, you can then look to adjacent segments where your USP is of measurable benefit as well.

Compelling Reason to Buy

Whether or not you call this the Unique Selling Proposition or, as I have, the Compelling Reason to Buy, stay strictly to the intent of the terms.  What is unique about your product/service that will make your target market change their behavior, without changing their behavior?  The first ‘behavior’ is what they might be buying today, the second refers to deeply ingrained habits, or behavior patterns which are much harder to change.

Still not clear?  Here’s an example.

When I was at a wireless messaging company we were ready to launch a new hand held product and a $500 million 2-way network.  Amongst a myriad of activity, the new wireless device, the new network type, new compression algorithms, custom market research and focus groups, media planning for a regional roll out, brand name development, logo development, packaging, sales training, collateral materials, filming TV commercials, creating radio spots, newspaper advertising, billboards and many more things … something almost slipped through the cracks.

Since the advent of numeric pagers, after you entered your ‘digits’, you concluded by pressing’ #’ on your telephone keypad.   Unknown to anyone at our company, the infrastructure supplier switched the protocol to pressing the ‘star’ button after you left your message.  We were just a month from launch when I found out.  Why was this so important?

Muscle memory is the most ‘hard-wired’ of all behaviors.  The first users of the new device were going to be existing users, right?  Yes BUT …  Of more importance were those leaving messages for these customers who were accustomed to pressing ‘#’.

We had the change made back to # and, at least that problem was taken care of successfully.  There was more ‘fixin’ needed that I’ll cover in additional posts.

Category

If you can create a new category (where yours is the first product of its kind) that links to an existing one that is familiar, you have a leg up on the competition.  First there were supercomputers, and later mini-supercomputers and super-minicomputers.  I’m sure you can think of more.  What many miss however is what we have, and will say, over and over again: because hi-tech marketing is different from consumer marketing, a number of players in the communications infrastructure need to “buy in” to the term you use because it needs to be used by others to become accepted.  Otherwise it’s just more of what we called at Gartner SSVH (Self-Serving Vendor Hype).  If you are creating a new category, start with those you can trust (or from whom you can ‘buy’ silence under NDA) and gauge their reaction.  How fast do they ‘get it’?  Does is seem stupid to them? Or do they wish they had thought of it first?  Don’t go forward unless you pass the ‘no puffery’ test.

Other Elements

By the time you get the first three buttoned up, the last three should almost fall into place:

  • That provides (Key Benefit … Boil it down to something short and memorable)
  • Unlike (Primary Competition … Don’t say there isn’t any. At the minimum it’s the current way of doing things)
  • Who/Which (Competitor’s Main Benefit … If you didn’t study your competitor first you shouldn’t be here)

That’s all there is to it! It will take a lot of work, over a few months of concerted effort, to get an acceptable working draft, but I can assure you it will be worth it.

Where Do I Start?

A strong suggestion …  Begin by asking key executives in your company/division, SBU, etc. a set of up to 10 of identical open-ended questions, in the same order, that you can compare and contrast with each other.  Find out what is in agreement and where opinions diverge.

Here’s a beginning:

  • Who is/are our target markets?
  • Why do customer buy/why will they buy our product/service?
  • What would you call the segment of the market we might be in?
  • What is/are our key benefits?
  • How are we different from the competition?
  • How are we different from how our target market does things today?
  • What is our main competitions best feature/benefit?

Sound famiiar?  Once you get your results, you’ll have a good start on “Iterating towards the truth” (Skip Bushee, founder of InfoCorp, later acquired by Gartner Group).

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