By understanding the specific nuances of product positioning for new B2B high-tech products, founders, CEOs, product management, marketers, and product marketing can accelerate product/market fit and new product revenue, maximizing their return on innovation.
Product positioning is a critical aspect of marketing strategy for new products or services, especially for B2B technology and software products.
Given today's innovation speed and competitive landscape evolution in high-tech markets, it is essential to position innovations effectively to highlight their value, attract the right buyers and differentiate from competitors.
Product positioning is the process of placing your product in the minds of buyers relative to its alternatives, which may or may not be competitive products.
It involves identifying and highlighting your product's unique features, benefits, and value propositions and placing them in your target's minds in a way perceived as much-needed, credible, and differentiated.
Brand positioning focuses on helping established or mature businesses build a mental space or perception about several company attributes, like what they do, who they help, and their strengths to build long-term advantage and defensible growth.
Product positioning is about positioning a new product (in the case of new startups) or a specific product offering (in the case of established, scale-up, or mature businesses). Product positioning is also more focused on the specific scenario the buyer and end-user face.
Although there are some similarities, we will focus this article on positioning for new B2B tech/saas products and innovations.
Positioning is strategic, defining the desired market perception of your product with a focus on differentiation and credibility, led by CXOs. It's your business or product North Star that defines the WHY, and WHO to sell to.
Messaging, also strategic, defines the WHAT to communicate to the market based on the WHY and WHO, usually crafted by marketing or product marketing leaders.
Copywriting is the HOW you communicate the messages. It is the tactical creation of clear and specific texts that convey the messages in the brand's voice and tone, typically done by copywriters and content writers. Each step builds on the last, from strategy to specific marketing assets.
The main difference in B2B technology buying decisions versus other products (like consumer or cheap products) is that they are high-risk decisions.
Technologies change quickly, providers are created and die every day, and products can require a steep learning curve, integration, and change management in the clients, putting the implementation projects at risk.
By building a strong market position, a high-tech product or business will help overcome market objections related to risk.
Great product positioning requires market research, competitor analysis, and segmentation to identify target market segments, customer needs, and preferences.
By understanding customer pain points and unique product features, CEOs and founders can inform product strategy and position their products in a way that resonates with potential customers.
A key component of new product positioning is developing a clear positioning statement that reflects the product’s unique value proposition, target audience, and competitive advantage.
This statement will become the guiding principle for your product, marketing, and sales teams, ensuring they align with the desired market perception you want for your product.
If any of those feel familiar, it is time to prioritize resources to rethink your product positioning strategy.
If you are familiar with our methods, the following process will resemble you to our 11-step go-to-market strategy framework, you're right.
We are working on this reduced version to put together the process of new product positioning and go-to-market strategy. We hope it helps you make the process more digestible.
As you can see, it's all about the value you're creating and communicating to your market.
This article will focus on steps 1, 2, and 5, which are the most commonly related to positioning strategy.
Successful product positioning strategies are built at the intersection of 5 elements:
All these elements are grounded in deep research and understanding of your customer, your market and your competitors. With the raise of AI tools, you can streamline the market research process.
The first step is to execute market research and understand the type of innovation you're launching and its location in The Technology Adoption Lifecycle curve.
Your market maturity highly influences positioning and go-to-market strategy decisions about your product:
During this market research phase, you want to understand how market trends may impact your innovation.
Research the trends and revisit them when you're working on framing your product positioning.
Market trends and insights are an excellent way to frame the problem you solve and start your pitch. They grab your audience's attention by starting with something insightful and counterintuitive or a trend everyone knows and is relevant to frame your product with your storytelling.
For example, if you are launching software that helps your target audience save money in 2022 or early 2023 in the USA, you could use the economic downturn as a starting point to frame your solution.
Another way to start is by sharing an insight or point of view that makes your target think.
This step also includes understanding current market perceptions, how people are categorizing (the mental box in your customer's minds, like "CRM" or "email marketing platform") products like yours, and terms that are driving confusion.
The second element is understanding your target market and their motivations to buy profoundly.
For each potential target audience, interview 12 to 15 people and create a customer scenario with the patterns that you find.
Your scenario worksheet, for each type of buyer, should include:
You can also use tools like Wynter to research and get insights from your targets to complement your interviews.
We've created a visual example of a target scenario worksheet for the AI Meetings assistant tool fathom.video:
1. Define the high-level scenario and workflow of the end user and the problem you're analyzing:
2. Define what is broken for them. Their pains, their struggles, their frustrations, and the penalties of doing it this way:
3. Define how your innovation or product attempts to solve the issues:
4. Find out objections to buy and hesitations to understand the risk perception of your prospective customers. Then define whole product or business model attributes to overcome them. The next image follows fathom.video example to understand customer hesitations to buy and the solutions.
Your strengths will make your position more credible and potentially challenging to copy.
Technology is easy to copy, but your knowledge, experience, insights, or customer base are almost impossible to replicate.
During this step, you must build a SWOT analysis and consider how your strengths and weaknesses can impact your positioning strategy.
You can think about strengths in different ways:
To go to market with a new innovation, it's okay if you can't prove strengths, as your early adopters don't care much about that. You can build your strengths as you gain more traction in the market.
You now understand your target customer's scenario, market context, and strengths.
By performing competitive research, you'll find whitespaces like different problems nobody has solved for your audience, different ways of solving them, or demonstrate better strengths than your competitors.
Your main competitor may or may not be an existing solution. It could be a current end-user behavior or status quo.
If you're in an early market, your main competitor is probably the status quo. The less risky decision for prospective buyers is to remain the same, even if this sounds counterintuitive. Most people don't want to change or risk trying an emerging innovation that requires workflow change.
That privilege is reserved for innovators and early adopters (16% of the population).
Your product innovation and go-to-market resources are limited. If you spread them by targeting multiple audiences, you will run out of money or resources before you find a profitable market. Imagine building features for diverse end-users, multiple marketing assets, value propositions, distribution channels. that's not an optimized go-to-market strategy.
The sooner you find a niche you can win, the sooner you can communicate that win as a competitive strength to drive credibility and go after a new segment from a stronger market and financial position.
Suppose you're in an early market with a horizontal product or technology, exploring multiple potential target customers or segments.
You can use this opportunity scoring template to find who can be the beachhead segment that will allow you to win and jump into adjacent segments by following the bowling pin strategy.
The next image showcases the product positioning example of Stripe. They started narrowly by targeting e-commerce with an online payments API.
As they penetrated further and developed their product, they jumped and conquered into adjacent segments using the strengths and credibility build with the previous segments, expanding their customer base and becoming the absolute leader and de-facto standard. "The payment platform for the internet".
Once you have done all the strategizing work, it is time to put it in words and a document that you'll use to share with your team to drive alignment and communicate a clear strategic direction. You'll also update it as you learn from the market feedback loops.
This positioning platform is a set of marketing messages you will use to communicate your positioning strategy internally and externally.
Copy and paste the next outline to create a product positioning template:
A positioning statement is a great team alignment tool. It guides your product development, marketing strategy, and sales process by defining your market, competitive advantage, and the unique position of your product.
All this can be summarized in this product positioning statement template:
Convertkit is a real-world example of effective positioning to establish market leadership in a crowded mainstream category.
They started when the marketing platforms and email automation categories were already crowded and dominated by companies like Mailchimp, Active Campaign, and 100+ other tools in the same category.
Instead of competing with the hundreds of platforms and the existing market leader (Mailchimp), they discovered a lucrative underserved segment.
They focused all their efforts on building a complete product and differentiated value proposition for that segment.
Convertkit's positioning statement example:
ConvertKit is the current market leader in marketing platforms for creators by using the magic formula:
SEGMENTATION + DIFFERENTIATION = MARKET LEADERSHIP
You don't want to launch a press release or communicate the general availability of an untested product that nobody wants or understands.
Test or validate to get direct feedback from your audience and understand how they view your product before it hits the market. You might even get your first customers.
Here are some real-world ways to test them:
That being said, the best way to test how you communicate your product's position is, well, sell your product!
Through this audience testing and feedback, you'll:
All this testing is a market feedback loop that comes after and just after you have performed the initial market and audience research steps.
Positioning is not one point in time but a dynamic exercise because the types of buyers you'll find in a tech market make decisions based on different criteria.
Business leaders' approach to evaluating your product will switch as your market matures. You'll find new motivations to buy, which means they perceive the way value changes:
That means your value and how you communicate it must also change to keep in alignment with your market.
Because you don't know the type of buyer reading your website, you must provide all messages to position your product (and, when mature, your brand) as a highly differentiated, relevant, trusted, and low-risk solution.
Your product or brand position exists in people's minds, not your words. You can't position your product; the market does it — influenced by the top 10% ecosystem players. You need them.
That's why helping your market make that mental space for your product with education and awareness is a must step in your product positioning efforts.
Every market has a set of ecosystem or infrastructure players between your product/brand and your potential new customers. 10% of these ecosystem players influence the other 90%.
These ecosystem players are the ones influencing the creation of mental positions and perceptions, mainly through WOM.
New product positioning done right includes a marketing plan to create your desired market position by educating your ecosystem players.
The next pyramid is a real-world example of the ecosystem map in the Incident Management software space in the USA in 2023:
Build relationships with the top 10% of players in the ecosystem, address their concerns about your product, and nurture them with custom messages they can share with the rest of the market.
Once you have your draft of your positioning strategy, follow these steps to introduce your product and start building your position:
The following image is an example of product positioning activation.
By securing a podcast interview hosted by a 3rd party thought leader in the market ecosystem of our client, the CEO was able to communicate their positioning strategy.
It helped them gain credibility and authority because they were invited by an objective, unbiased 3rd party player with no intention to sell.
Understanding the market ecosystem forces and building relations with the top 10% of influencers is critical to increasing Word-of-mouth and building your market position.
Building this WOM system reduces customer acquisition costs, positions your product in the market, builds credibility and brand awareness, and optimizes market pull.
Watch our webinar on positioning for B2B high-tech 👇👇👇
Product positioning is crucial to the success of new B2B technology and software products. It helps differentiate your new product from the competition and communicate its uniqueness to your target audience.
Take the time to evaluate positioning possibilities for your innovation, perform thorough market and audience research, identify whitespace, and develop a desired positioning strategy and activation plan to be seen as a credible, relevant, and differentiated provider by your target customers.
Email us to let us know what you think about the Positioning-to-market™ framework! Is it easier to follow than the 11-step go-to-market strategy? What do you like and what you don't?
Thanks for reading my thoughts! I bring 16 years of experience selling and marketing B2B tech products. I define myself as a thinker on the impact of human behavior on innovation adoption, marketing strategy, go-to-market, and business leadership in B2B high-tech. Armed with this knowledge, I help B2B high-tech leaders accelerate traction by aligning their strategy with what buyers want as coach, speaker, and workshop leader.
