Market Category is important, but it is not the core of our positioning. Many companies think that positioning starts with choosing a market category because they believe it’s the most important part. But they are wrong - let me explain.
I would like to ask if you have a clear answer/reason to make the target market 4th on the positioning framework rather than the conventional 1st. I understand your approach but it becomes hard to explain it to the wider team when conventional positioning work starts with the CP?
This is essentially the point of this post. If we start with the Market Category, we don't have any way to assess whether the category is better or worse than any other category. If we agree that the job of a market category is to put our differentiated value in context for our best fit customers, then it would only make sense that we need to figure those other two components out first, before looking at Market Category.
I do not believe that "conventional positioning work" starts with a market category. In my experience conventional positioning work starts with a positioning statement. My work answers the question - how do we know how best to full in the blanks of a positioning statement? It has only been in the past 2-3 years that I have seen teams attempt to do positioning by starting with the category. I've rarely seen it work well and I assume we will move on from that as the evidence mounts up that this isn't a great way to do it. In the meantime, I will be over here, giving my opinion on stuff to help folks from making an obvious mistake :)
Some of the marketing people I'm working with suggest our product could establish a new category, which scares me. This article defined how to use marketing categories and resolved my challenge. We're part of the 90% of companies that should "set the context" for our product within an existing market category. Time will tell if we can evolve from here to a new category or sub-category. This was very timely April - thank you!
Nice job and couldn't agree more. I've witnessed several times in my career an overemphasis on the category definition because the company (founders, product leaders) did not like the category in which their product most likely fit. There may have been a valid reason for attempting to "change" it, but that never should be done without first understanding the differentiated value and ICP.
Appreciated your insights and thanks for sharing. You mention many people make up new categories and that dries sales... how do you know if you have a new category rather than not? I am finding that stating it as a new category creates clarity, I mention the competition in the related markets and my advantages and differentiator i.e. why I am not part of that market... and then we move on to explore the product and its benefits... (enjoying the excitement about the trend)... Does that seem right?
Making up a new category for the sake of making up a new category is almost always a mistake in my opinion.
What I think works better is to determine your differentiated value and your best fit customers and then look at whether or not an existing category could do the job. It's much easier to help a customer understand what we are and why they should care if we can start with something they already understand.
In some cases, no existing category works well to help point a customer toward our value so we will have to create a new one. This is harder to do but in these cases we have no choice.
Put another way - if what you are doing is undersold by positioning it in an existing category you are absolutely not going to want to position yourself there.
Thanks April, very clear. I loose in an existing category (your database/data warehouse example). And can clearly state how and why it is important that we are not like the existing category (and the advantages of it for the prospect)... As you say, it is a harder road but better than the alternative. Many thanks! :-)
I very much enjoyed this post and is a valuable read for us - marketing professionals and business leaders. It challenges the conventional approach to market categorization and positioning, urging a more strategic and value-focused perspective. Your established expertise shines through, making complex concepts accessible and providing practical insights for effective product positioning.
April, your book has been a tremendous resource for me—I've read the positioning one multiple times and listened to nearly all the podcasts. Your insights are truly brilliant, and I'm currently leading our first positioning exercise. However, I’m still unable to find further clarification for some recurring questions.
1) We are in a niche market with a limited number of global customers. For instance, our most successful solution, let's call it banana, serves an extremely small number of existing customers. While I understand the concept of focusing on the best-fit/happiest customers, our niche context seems to require us to not exclude the mediocre-happy customers in our positioning. I'm curious to know how we can find that sweet spot.
2) We will be launching something new around bananas to be more competitive. We only have 1 existing customer for this new banana. I know you said we should hold off on positioning until we have the happiest customers but we would need to have some sort of positioning, sales pitch, and the rest for such a new product. How should we go about doing that?
Sometimes we are simply too early in the market to see any patter across customers because there are so few of them. The could be the case in your situation. If there are only one or two good fit customers, it will be hard to make generalizations about what the real competitors are or what your true value is. In these early stages, it's generally best to keep the positioning fairly loose until you have enough business to really see the patterns.
Which brings me to the second part of the question. For anything new we are launching, you are correct, we are going to have some sort of positioning. In my experience, in these early stages it's best to keep the positioning loose. For example, you might have a theory that your product is really great for quick serve restaurants to improve their online ordering, but until you close a few, you won't know that for sure. In the early stages you might want to not narrow yourself to quick serve restaurants only and widen it out to any type of fast food.
This loose positioning is going to feel terrible. The pitch will feel mushy and weak. The alternative is worse however. If you tighten around something and your guess is wrong you won't have learned much and early sales will generally come from working your networking and doing other things that don't scale. Loose positioning is ok in that situation. Once you have enough customers to start seeing the patterns, then you can tighten it up.
Hi April, super grateful for your help on this. Very clear!
In our niche market, we will never have as many customers as those in regular B2B tech. It's also very helpful as I found back this great approach mentioned in your book: when looking at how broad our best-fit customers should be, we need to look at business objectives/sales targets.
This was an incredible read with a great framework to work through.
Really agrees with the positioning first then category approach
Hey thanks so much - I appreciate that!
Hi April, great post.
I would like to ask if you have a clear answer/reason to make the target market 4th on the positioning framework rather than the conventional 1st. I understand your approach but it becomes hard to explain it to the wider team when conventional positioning work starts with the CP?
Cheers
Hi Claudia,
This is essentially the point of this post. If we start with the Market Category, we don't have any way to assess whether the category is better or worse than any other category. If we agree that the job of a market category is to put our differentiated value in context for our best fit customers, then it would only make sense that we need to figure those other two components out first, before looking at Market Category.
I do not believe that "conventional positioning work" starts with a market category. In my experience conventional positioning work starts with a positioning statement. My work answers the question - how do we know how best to full in the blanks of a positioning statement? It has only been in the past 2-3 years that I have seen teams attempt to do positioning by starting with the category. I've rarely seen it work well and I assume we will move on from that as the evidence mounts up that this isn't a great way to do it. In the meantime, I will be over here, giving my opinion on stuff to help folks from making an obvious mistake :)
Some of the marketing people I'm working with suggest our product could establish a new category, which scares me. This article defined how to use marketing categories and resolved my challenge. We're part of the 90% of companies that should "set the context" for our product within an existing market category. Time will tell if we can evolve from here to a new category or sub-category. This was very timely April - thank you!
Nice job and couldn't agree more. I've witnessed several times in my career an overemphasis on the category definition because the company (founders, product leaders) did not like the category in which their product most likely fit. There may have been a valid reason for attempting to "change" it, but that never should be done without first understanding the differentiated value and ICP.
Well said April!
Appreciated your insights and thanks for sharing. You mention many people make up new categories and that dries sales... how do you know if you have a new category rather than not? I am finding that stating it as a new category creates clarity, I mention the competition in the related markets and my advantages and differentiator i.e. why I am not part of that market... and then we move on to explore the product and its benefits... (enjoying the excitement about the trend)... Does that seem right?
Making up a new category for the sake of making up a new category is almost always a mistake in my opinion.
What I think works better is to determine your differentiated value and your best fit customers and then look at whether or not an existing category could do the job. It's much easier to help a customer understand what we are and why they should care if we can start with something they already understand.
In some cases, no existing category works well to help point a customer toward our value so we will have to create a new one. This is harder to do but in these cases we have no choice.
Put another way - if what you are doing is undersold by positioning it in an existing category you are absolutely not going to want to position yourself there.
Thanks April, very clear. I loose in an existing category (your database/data warehouse example). And can clearly state how and why it is important that we are not like the existing category (and the advantages of it for the prospect)... As you say, it is a harder road but better than the alternative. Many thanks! :-)
I very much enjoyed this post and is a valuable read for us - marketing professionals and business leaders. It challenges the conventional approach to market categorization and positioning, urging a more strategic and value-focused perspective. Your established expertise shines through, making complex concepts accessible and providing practical insights for effective product positioning.
April, your book has been a tremendous resource for me—I've read the positioning one multiple times and listened to nearly all the podcasts. Your insights are truly brilliant, and I'm currently leading our first positioning exercise. However, I’m still unable to find further clarification for some recurring questions.
1) We are in a niche market with a limited number of global customers. For instance, our most successful solution, let's call it banana, serves an extremely small number of existing customers. While I understand the concept of focusing on the best-fit/happiest customers, our niche context seems to require us to not exclude the mediocre-happy customers in our positioning. I'm curious to know how we can find that sweet spot.
2) We will be launching something new around bananas to be more competitive. We only have 1 existing customer for this new banana. I know you said we should hold off on positioning until we have the happiest customers but we would need to have some sort of positioning, sales pitch, and the rest for such a new product. How should we go about doing that?
Your views on this would be super helpful!
Hi,
Sometimes we are simply too early in the market to see any patter across customers because there are so few of them. The could be the case in your situation. If there are only one or two good fit customers, it will be hard to make generalizations about what the real competitors are or what your true value is. In these early stages, it's generally best to keep the positioning fairly loose until you have enough business to really see the patterns.
Which brings me to the second part of the question. For anything new we are launching, you are correct, we are going to have some sort of positioning. In my experience, in these early stages it's best to keep the positioning loose. For example, you might have a theory that your product is really great for quick serve restaurants to improve their online ordering, but until you close a few, you won't know that for sure. In the early stages you might want to not narrow yourself to quick serve restaurants only and widen it out to any type of fast food.
This loose positioning is going to feel terrible. The pitch will feel mushy and weak. The alternative is worse however. If you tighten around something and your guess is wrong you won't have learned much and early sales will generally come from working your networking and doing other things that don't scale. Loose positioning is ok in that situation. Once you have enough customers to start seeing the patterns, then you can tighten it up.
I hope that helps!
Hi April, super grateful for your help on this. Very clear!
In our niche market, we will never have as many customers as those in regular B2B tech. It's also very helpful as I found back this great approach mentioned in your book: when looking at how broad our best-fit customers should be, we need to look at business objectives/sales targets.