Why, as a Founder, Positioning should be Your Key Strength ?
Why, as a Founder, Positioning should be Your Key Strength ?
Why positioning is everything in the startup world
Introduction
Marketing geniuses, AL Ries and Jack Trout, have said that marketing is a battle of perceptions, not products. One of key drivers of perception is positioning.
What is Positioning ?
Positioning is an art of describing your service and product such that its value is clear to the targeted customer. A good product will be positioned in such a manner that it addresses the hair on fire problem the targeted customer has.
How to decide on positioning?
Positioning can be done in two ways:
Competitor focused Positioning
Positioning based on competitor companies. This type of positioning requires you to identify the features and aspects that set you apart from the competition. As a founder, you should be able to differentiate between positioning for VCs and for users. When building a pitch deck for fundraising, you might want to draw the standard SWOT analysis on the competition and show why you have a differentiated product based on your point of view on the industry. But if you go down this route for your customers, as an early stage startup, you will appear like a feature factory to the users. And what really harms a startup is the fact people have to overload their brains with information. It’s necessary to keep in mind that humans don’t want to waste their “brain cycles” on tasks that are not core to their ability to live. Anything that demands “brain cycles” will be strongly resented or totally ignored.
Everyday Alternatives Positioning
As a founder, when you are solving a specific problem that is faced by a potential customer. You need to worry about what alternatives they are using. They could be using an intern to do it, an excel sheet or word document to solve that problem sub-optimally. These are the everyday alternatives that your product is really competing against according to the customer. If your customer isn’t aware of your competitor company X, it makes no sense for you to position yourself with respect to them. Giving customers the insight as to why you think this problem is important and how it can be solved as compared to everyday alternatives, in the simplest of language, will make the customer notice and think about your product.
Mistakes we made and learnt from
Founders often read the statement on social media that VC pitch is different from customer pitch. But no one seemed to tell us how it is different. Above I have detailed my perspective on how it’s different essentially when it comes to positioning.
Another mistake we and many founders make is that we speak about how the future of the product will evolve to customers. But only later did we realize that customers are only interested in the here and now. Speaking about the future confuses them and makes them think - “Do I need the X feature that they speak about now? Why should I pay when it’s not available now? “. Consumers in our observation, sometimes even people closely following your journey, are really bad at understanding features that will come in future. Again the principle of minimizing brain cycles for people kicks in and people just become uncertain of themselves. This led to action paralysis in the customers.
Lastly, can’t iterate enough, how simplest language is necessary for success of the startup. Founders, and that includes us, see branding of big players like Nike or Apple. We are compelled to believe that for a small company, who no one recognizes, must come up with a slogan that sticks in the mind of customers. In order to “think different” we come up with complicated jargon and poetry-like language to impress upon the customers how big and serious a player; we are. Completely the wrong path to take.