In my view, there are two types of product positioning and differentiation: Push and Pull. Both have benefits and drawbacks.
A Push positioning and differentiation strategy assumes that you understand the market and your customers well enough that you can come up with some positioning that sets you apart from the competition. You have a vision and hypothesis about why you’re different and better, and you push that message to the masses, without extensive customer validation.
Pros: To develop this kind of positioning, all one has to do is look at the competition’s literature and come up with positioning that seems sufficiently different from the alternatives. Potentially saves time because it can be done without speaking to customers. Maybe a good first step in developing a go-to-market strategy.
Cons: The competition may have it all wrong and have no idea about what customers really want, so trying to work around the competition’s messaging may be pointless, since they all have it wrong anyways-and you probably do too since you haven’t spoken to any customers!
A Pull positioning and differentiation strategy implies that your customers tell you what features, functions, positioning, and messaging that they find most compelling. You use these “pulled” items as the crux of your messaging and positioning versus a hypothesis about the messaging and positioning that will resonate with a customer. This is how the Customer Development guys would argue that you should develop your messaging and positioning.
Pros: You’re using positioning and messaging that has been validated by numerous potential customers in your target market. These are the reasons they see your solution as different…and who are you to argue with the people who have the money?
Cons: Requires extensive customer interactions to identify the things that customers feel are the differentiated features of your product. Easier said than done and may require several, iterative cycles of customer interaction.
What are your thoughts on Push vs. Pull? Are there certain markets or types of products where one strategy is superior to the other?
Related articles by Zemanta
- Market positioning for startups – focus, focus, focus (beyondvc.com)
- Segmenting and Targeting Markets (slideshare.net)
- The Customer Development Manifesto: The Startup Death Spiral (part 3) (steveblank.com)
I don’t think that it’s one or the other and done properly the first scenario turns into the second. In your push scenario as you have described the best way to differentiate yourself is to figure out a way to solve a customer’s problem. Doing that means you still have to do the work to understand customer pain (not just what the competitors are doing). I’ve done this in companies where we didn’t call it “customer development” but that was essentially what we were doing.
Similarly in your pull scenario, you shouldn’t focus on competitors but the fact that customers have alternatives should inform at least your initial guesses at what customers find valuable.
Some types of products are harder to prototype and iterate (hardware for example) but you still end up doing it whether you want to or not and the later you leave it, the higher your chances of failure. Customer development works to push that investigation as far forward in the timeline as possible which I believe is a good thing for any startup.
I recommend an iterative approach to positioning that April hints at in her comment.
Positioning is a fundamental part of product strategy and should drive almost every product decision, including product requirements, market messaging, sales approach, and partnerships. Positioning effectively selects and prioritizes the market problems to solve.
The idea that you would develop, market, and sell your product and THEN think about positioning is misguided. Unfortunately, it is all too common.
Nevertheless, all aspects of your product strategy are subject to change. Agile methods start from the premise that even our recognition and understanding of market needs will be incomplete until we demonstrate something to customers. Accordingly, positioning is subject to change as our understanding of the market sharpens.
Finally, no matter how we attempt to position our product, what ultimately matters is the actual perceptions of it in the minds of prospects and customers. Their perceptions may not match the positioning we originally envisioned for our product. In that case, “pull” positioning is reality we must face, and one that we can leverage to our benefit.
John – great post, and comments.
To find the right balance between getting that alpha-type customer feedback when entering a new market is a great question
I think the iterative approach works best when a startup/company is really nimble (idealistically this applies to all startups). If the cycles between customer touch points are too protracted/long the customer may have shifted gears and there is a general lack of continuity between meetings. I was at a hardware company which struggled with this balance – it would have been better if we ‘iterated’ less and just got a sub-optimal product to market sooner. This would have instilled more confidence in our speed/agility even if the final product was less feature rich. Of course that product led to other ideas etc….