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The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
The Positioning Statement   A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)
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The Positioning Statement A Description Of The Lustratus Positioning Statement And Its Constituent Parts (1.00)

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This document defines the positioning statement format that Lustratus REPAMA uses as part of its consulting services that help our clients to build compelling market propositions. Sections include …

This document defines the positioning statement format that Lustratus REPAMA uses as part of its consulting services that help our clients to build compelling market propositions. Sections include discussions on the target audience and ideal client, their pain, need or desire, the product name, the product category or segment, the main reason to buy, the likely competitor or alternative and the unique selling proposition (USP).

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  • 1. REPAMA The Lustratus REPAMA Positioning Statement A description of the Lustratus positioning statement and its constituent parts Author: Danny Goodall Version 1.00 Page 2  December 2009
  • 2. Table of Contents Introduction ....................................................................... 2  The Positioning Statement ................................................. 3  What purpose does the positioning statement serve?.. 3  The format of a positioning statement .......................... 3  An example positioning statement ............................... 4  FOR…The Ideal Customer ................................................. 4  Examples............................................................... 5  WHO…Pain, problem, need or desire ................................ 6  Examples............................................................... 6  OUR…Product Name ........................................................ 7  IS A…Product Category .................................................... 7  Examples............................................................... 8  THAT PROVIDES…The Main Benefit or Reason to buy ..... 9  Examples............................................................. 10  UNLIKE…The Primary Competitor or Alternative .............. 10  Examples............................................................. 11  Real world example ............................................. 12  OUR PROUDCT…The Unique Selling Proposition ........... 12  Examples............................................................. 13  Real world example ............................................. 13  Bringing it all Together ..................................................... 14  Further Reading ............................................................... 14  Page 3 
  • 3. Disclaimer Whilst reasonable care and skill has been taken by Lustratus Research Limited (the company) in the preparation of this report no liability is accepted by the company (except in the case of death or personal injury caused by the company's negligence) by reason of any representation or any implied warranty condition or other term or any statutory or common law duty or otherwise howsoever arising for any direct or indirect general special or consequential damages or loss costs expenses or other claims (whether caused by the negligence of the company or otherwise) which come out of the provision of this report or its use. All trademarks are acknowledged as the property of their respective owners. About Danny Goodall For more than 20 years Danny Goodall has served the IT Industry in a mixture of technical and marketing roles. During his 10 years in software development he touched most technical disciplines from developer to architect through support and finally to Technical Director. He was responsible for systems development for many organisations from small start-up software houses to system integrators and large multinationals. For the past 12 years Goodall has married his technical background to an inherent understanding of the principles of technology marketing, helping organisations to take technology-led offers to market more effectively. He has launched numerous infrastructure products into the European marketplace including Databases, AppServers, Message Oriented Middleware, SOA stacks, Cloud Computing offerings, Event Processing, BPM and ESBs. Being part of the team that created the ESB product category while at Sonic Software and having consulted to numerous infrastructure vendors, his expertise lies in infrastructure software. Goodall is also founder of OneBloke Technology Marketing and serves as a board advisor to a number of companies in this space. In 2006, Goodall invented the Reverse-Engineered Positioning and Messaging Analysis (REPAMA) methodology. This breakthrough piece of competitive intelligence reverse-engineers vendors’ go-to-market strategies from the way they communicate with their prospects and customers. Goodall blogs on technology marketing issues at http://www.lustratusrepama.com/repama-blog. Page 1 
  • 4. Introduction This document is based on a series of blogs taken from http://www.lustratusrepama.com/repama-blog that describe the format of the positioning statement that Lustratus uses when helping our clients to define go-to- market propositions. Organisations typically turn to the discipline of positioning or re-positioning when they find they are losing sales to competition, when they are unable to define how they differ from their competitors or when they are unable to make prospects understand the value of their products or services. Positioning helps vendors to align their product or organisational strengths to the needs of their prospects and makes it easier for the entire organisation to attack the market behind a single, powerful strategy. In this document I hope to answer the following questions. What is the positioning statement? Why use a positioning statement? What is the value of a positioning statement? What is the format of the Lustratus REPAMA positioning statement? To help to illustrate some of the positioning concepts in this document I have used example positioning statements that have been reverse–engineered using our REPAMA methodology. These examples are taken from our ESB Segment Analysis Study but it shouldn’t matter if you are not intimately familiar with the ESB or SOA markets. It should also be noted that many of the examples given below are written from a business to business, high-tech, early market perspective. Whilst the disciplines discussed are transferable to other markets and marketing categories, the examples and tactics may not be. It should also be said that whilst the positioning statement is the repository for the strategy, the considerable internal and external analysis and creativity involved in producing the strategy should not be underestimated. Whilst some of the exercises required to create the positioning statement are touched upon in this document, the full details are outside the scope of this document. Contact us at info@lustratusrepama.com for details of how we can help you achieve a compelling and competition killing proposition for your prospects. Page 2 
  • 5. The Positioning Statement Over the years, having worked with some of the best product marketing people in the industry, I’ve seen many different approaches to positioning and equally many different formats for positioning statements. Each format has been valuable to a greater or lesser extent. The majority of positioning statement formats that I’ve seen and used have had a very similar structure which we will examine below. Having said that, I have also seen some examples that have been very different, appearing more like what I would refer to as a value statement or a value proposition. There is no single correct way to construct a positioning statement but Lustratus has settled on a specific format that captures and conveys the seven key product marketing elements and it is this format that I will concentrate on here. What purpose does the positioning statement serve? It’s probably best to start with a definition for positioning first. And if positioning statements are contentious then the broader subject of positioning is even more so. Whilst there are many views on this, for me positioning is about convincing your target customer that you have a solution to their problem that is better than the likely alternative. It’s about creating a unique, compelling and defensible space in the minds of your prospects where your product/service and only your product/service sits. Your ideal prospect must feel that you created the product/service for them alone to answer their specific problems and very importantly they must understand exactly how you are different and better than the alternative or competition. Most product marketing professionals understand this well but as mentioned above, the development of positioning strategies and the statements that captures those strategies can take many different forms. In my experience most positioning statements are designed to be internal tools for the development and internal communication of a unique and compelling market proposition. The positioning statement seldom gets used externally (with customers or prospects) in its raw format. External marketing communications strategies are typically developed using the internal positioning statement as a guide. The positioning statement conveys the following seven product marketing elements: The Ideal customer The main pain that the ideal customer has or the negative situation they find themselves in The name of the product The name of the product category – the generic way to refer to the class of product (I often see this omitted) The main benefit that the product provides and the key reason that the prospect should buy the product The primary competition or alternative The unique selling proposition (USP) The format of a positioning statement A positioning statement is natural language-based and should read fluidly and easily as a single sentence and yet should contain all seven of the marketing elements above. This sounds like a complex task and to aid us in that development we use a specific structure for the statement. This is shown below. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. Page 3 
  • 6. So the “FOR…”, “WHO…”, “OUR…”, “IS A…”, “THAT PROVIDES…”, “UNLIKE…” and “OUR PRODUCT…” elements give our positioning statement the structure it needs. An example positioning statement An example positioning statement is shown below. It is taken from a Lustratus REPAMA Segment Analysis Study into the Enterprise Service Bus (ESB) market segment. In the study we reverse-engineer the seven marketing strategy elements of the positioning statement (as well as many others) used by a number of the vendors in the ESB market. In this case the products examined were Microsoft ESB Guidance, Oracle Service Bus, Progress Sonic ESB and TIBCO ActiveMatrix Service Bus. In the example below we’ve attempted to capture Microsoft’s position and proposition in the ESB market. “FOR Microsoft BizTalk Developers WHO are building solutions that leverage the SOA pattern OUR Microsoft ESB Guidance IS A loosely-coupled messaging environment THAT PROVIDES an infrastructure for enabling a service-oriented architecture UNLIKE traditional ESBs OUR PRODUCT provides a superset of ESB functionality, extending the ESB pattern to include modelling and execution of business rules, workflow, and adapter integration” It’s notoriously difficult to be precise when reverse-engineering a vendor’s positioning statement and sections like the “THAT PROVIDES…” and “OUR PRODUCT…” are especially difficult to define precisely. But hopefully this should provide an idea of how an organisation like Microsoft might set about defining its approach to a particular market segment. Element of this positioning statement will be used throughout the remainder of this document. The seven different sections of the positioning statement are explored in more detail below. FOR…The Ideal Customer Here we will take a look at the first element of the positioning statement - the ideal target customer. Let’s first revisit the format of the positioning statement just to give us a context. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. Defining the ideal customer element allows the organisation creating the positioning statement to express the characteristics of their ideal target customer for the product or service they sell. This can obviously be done in many different ways and I’ll list some of the more common ways below. In the Positioning Statement section above, I gave an example of the REPAMA reverse-engineered positioning statement for Microsoft ESB Guidance. We saw that Microsoft’s ideal target customer was defined as: FOR Microsoft BizTalk Developers Between you and I, this is not the most definitive classification of ideal customer I’ve ever seen, but when reverse-engineering a vendor’s implied positioning from their outbound marketing communications, it’s often as close as we can get. I suspect that Microsoft’s own internal classification will expand on this to include other characteristics that make their ideal target client more relevant to them. That said, in the context of the ESB REPAMA Segment Analysis Study that we conducted, we’re pretty confident that this ideal target client is correct for Microsoft. Other customer characteristics that can be used to segment the market to effectively define the ideal target customer include: Page 4 
  • 7. Industry/Vertical Can you define the industry or vertical market that the ideal client belongs to? Geography Where are they based? Size What size of organisation? – by revenue or employees Reach The reach of your organisation – local, regional, national, multi‐national? Budget Is the client able to be classified in terms of how much money they have to spend? Pricing Are they sensitive to price? Job title What is their position/job title? User Who will use the product? Decision maker Who makes the decision on this type of product? Image What image does this client have? – Leading edge, conservative, well know, leader in their own market. Benefit What will the product do to improve the client’s life? Reason to buy What compelling reason does the client have to buy the product? Use What other complimentary or competitive products are they using? Concerns What are the main concerns of your target client? Business type What is their type of business? Business model What is their business model? Competition Who is their competition? Clients Who are their clients? Problems What are their problems Examples Examples for a company that sells products used by telecommunications organisations might include: FOR mobile telecommunications organisations FOR mobile telecommunications organisations concerned with adhering to new governmental regulations FOR mobile telecommunications companies that sell through channels FOR mobile telecommunications organisations that have a prestige image FOR mobile telecommunications organisations that operate at the budget end of the market FOR mobile telecommunications organisations that compete with RingRingTelco Corp. etc. What we’re attempting to do here is to segment the total available market so that we end up with a segment that is a) big enough to sustain us, b) small enough for us to dominate and c) relevant to our product or service offer. Obviously credibility and ability to reach these organisations comes into the decision. So if I were a product marketing VP for a 10 man start-up software organisation, whist I might be attracted to an ideal target client of “The largest global banks struggling to implement a worldwide roll-out of XYZ application”, I might lack the credibility or the reach to be able to deliver on this. So as we can see the ideal target client goes right to the heart of the business planning for the product unit or corporation and is incredibly important to define accurately. Page 5 
  • 8. WHO…Pain, problem, need or desire The ”WHO…” element of the positioning statement is the pain, problem, need or desire that we believe that target customer is looking to resolve. Again, so that we have a context for the discussion, here is the positioning statement format that Lustratus uses. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. In the ”FOR…” ideal customer section above we had started to create the unique position in a prospect’s mind where our products and services uniquely sit. We did this by first identifying the ideal customer. Now we’re going to expand on the ideal client segmentation by adding a specific pain, need or desire that the ideal customer can relate to or a negative situation that they find themselves in. The “WHO…” element describes the situation, nearly always negative, that the ideal customer finds themselves in. The implication is that we can positively alter the ideal customer’s situation. The following questions often help to narrowing down the “WHO…” element of the positioning statement: Aspiration What is the ideal customer looking to do or achieve that they cannot do without help? Need What must the ideal customer do that they are struggling to do? Desire What is the desired state that the ideal customer is looking to achieve? Problem What is the problem that the ideal customer is wrestling with? Situation What situation (needn’t be negative) does the ideal customer find themselves in? Examples As mentioned above, we are using a reverse-engineered positioning statement for Microsoft ESB Guidance as an example positioning statement. Here, we saw that Microsoft’s “WHO…” section was defined as: WHO are building solutions that leverage the SOA pattern For those readers who are not experts in SOA (service-oriented architecture) or the infrastructure software market in general and the ESB software market in particular, “SOA” here is a relatively esoteric software architecture model that many organisations believe provides great benefits. Microsoft, amongst other vendors, claims that its products help its users to implement SOA more effectively. Microsoft is effectively saying that it believes that the situation its target customers (Microsoft BizTalk Developers) finds themselves in is that of ”building solutions that leverage the SOA pattern”. Interestingly, in our attempt to reverse-engineer Microsoft’s positioning statement, we see that Microsoft has not aimed at an overtly negative pain for the ideal customer. Rather it has chosen to simply focus on a situation the ideal customer finds themselves in. To balance this, other vendors from the Lustratus REPAMA ESB Segment Analysis Study show a different approach to the pain. Oracle with its Oracle Service Bus product chooses to identify the following area of pain in our reverse-engineered positioning statement: WHO need to enforce quality of service, security and performance policies across an enterprise- wide network of multiple SOA domains Page 6 
  • 9. Progress with its Progress Sonic ESB product identifies this need WHO need to connect many different IT resources using many different technologies in many physically different locations So whilst Microsoft has chosen to simply state a situation, other vendors have chosen to highlight specific needs or deficiencies. Remember the positioning statement in its entirety should be used to make the ideal customer feel that you have designed and built the product (or service) specifically for them in response to their specific problems. Other, more generic examples might include: …WHO are struggling to implement the latest governmental regulation …WHO need to remove costs from their IT operations …WHO fail to bring new products to market ahead of their competition …WHO are unable to ascertain their risk exposure in a timely manner …WHO cannot currently meet their corporate governance requirements etc. OUR…Product Name This is one of the supposedly easier elements to define, where little specific planning or strategy is needed. Here we’re looking at the “OUR [product name]” section of the positioning statement. So as above let’s look at the context of this element in the wider positioning statement. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. Having said that little planning or strategy is required here, what I perhaps should have said is that from the perspective of the product marketing task of creating the positioning statement, the product name is usually already in place. But not always and the existing product name may need to be modified in some instances. Obviously an incredible amount of effort, research and focus group feedback can go into selecting the product name. And whilst the name doesn’t usually change based on the ideal customer or the pain that they have, it might be that specific products are created so as to appear focused on a specific audience and/or problem. I’ve had experience of companies (mea culpa!) where the engineering effort required to bring such a product to market stretches only as far as to add an adjective or a noun to a product name in order to make it appear more targeted at a specific problem or prospect. Whilst the science of product naming is outside the scope of what I want to cover here, if you’re interested there is an good discussion on that subject, as well as many others in the seminal book by Ries and Trout “Positioning: The battle for your mind“. It’s a good read even if its roots are in advertising and it appears a little dated now. IS A…Product Category An important element to get right from a competitive positioning perspective is the general description of the product category that the product or service belongs to. This is defined by the “IS A [product category]” element of the positioning statement and as usual let’s look at the context of this element in the wider positioning statement. Page 7 
  • 10. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. The product category is a bucket into which other similar offerings are placed whose definition is generally understood in the wider market. Product categories can be defined by convention, market analysts or by vendors themselves. It is typically used as a mechanism for a vendor to communicate quickly and generically, what type of product they take to market. …OUR XYZ product IS A Database …OUR XYZ product IS A Relational Database …OUR XYZ product IS A Spreadsheet etc. From a marketing communications and lead generation perspective, selecting the correct product category is critically important. When prospects are actively looking to make a purchase, they may believe that they know what type or category of product will best solve their problem. Ensuring that you use language in your outbound communication that matches with your prospect’s expectation is critical. The product category should also ideally clearly communicate, in terms that the target customer would understand, what the product is and, ideally, does. Many highly technical vendors will use incredibly complex terminology to describe their product category. As long as the target audience within the ideal customer understands this terminology then there isn’t a problem. But if the target audience, as often happens, evolves over time to include individuals that do not understand such terminology then problems can arise. The temptation to re-segment an existing product category (as with Database and Relational Database above) or to even introduce a new product category is great amongst vendors looking to differentiate themselves versus the competition. Vendors often tell me that they can’t be put into a specific product category because they “do” so much more than the category describes. This is especially true in early market situations where some form of significant innovation might have taken place. The logic here is simple “I need to make my prospects understand why we’re different so I will create a new product category that better describes what it is that we do.” It sounds like a good plan however the task of successfully re-segmenting or even creating a new category is often underestimated. With millions of dollars in marketing spend at my disposal throughout my career, I have only once been part of the sustainable introduction of a new product category and only once have I successfully re-segmented an existing category. The lesson I learned was that It’s often better to work from within the category and differentiate there. Another key thing to remember when defining the product category, other than to question very hard whether you actually need to change an existing product category, is to keep an external perspective. Most vendors look in detail at the capabilities of their product and discuss this internally with the people they work with on a day-to-day basis. Instead of looking in the mirror, in my experience it’s best to look at the problem from the outside in. By putting yourself in the shoes of your prospects and asking how they will go about attempting to solve their problems you’ll gain greater insight. Ask yourself what category of product a prospect would turn to, to solve their particular problem. In many cases it’s moot anyway as, if you’re a market follower rather than a leader, you typically have to go with the category of the market leader anyway. And this is where competitive intelligence plays a key role. Examples In the example REPAMA reverse-engineered positioning statement I’ve used throughout this document, we’re looking at how Microsoft takes its ESB Guidance product to market. Page 8 
  • 11. Microsoft describes its product category as follows: IS A loosely-coupled messaging environment For those interested in the SOA and ESB market only, in the context of the Lustratus REPAMA Segment Analysis Study on the ESB market, this is significant. The other three vendors in the study each define their product as an Enterprise Service Bus. Whilst Microsoft generically uses the ESB term in its product name (ESB Guidance), it decided to refer to the category of product without it. One final comment on the product category element of the positioning statement is that from my experience in infrastructure software marketing, this element is the one that is most likely to be omitted or combined with the OUR [product name] element. Personally I think that this is a mistake. Considering the category that a product and importantly competitive products belong to is an essential discipline when taking technical products to market. THAT PROVIDES…The Main Benefit or Reason to buy This is certainly one of, if not the most important elements in the positioning statement. The “THAT PROVIDES [main benefit]” in my experience is one of the elements that vendors find the most difficult to define about their own offering. Once again, let’s look at how this element fits into the context of the complete positioning statement. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. In my experience of reverse-engineering hundreds of vendors’ positioning statements, this element is often watered down so that it lacks any real convincing power. The purpose of the “THAT PROVIDES…” element is to describe the main benefit that your product or service provides your customer. It details the value that your target customer can potentially derive and should be compelling enough to provide a reason for them to buy from you. Instead of this, I often see this element used as a place to add another ho-hum feature or an also-ran benefit. The question that should be asked is “What benefit or value will compel the target customer to want to go through the process of buying from you?” Whilst this is not a hard and fast rule, the “THAT PROVIDES …” element is often paired with the “WHO [has this specific pain or problem]” element of the WHO... THAT PROVIDES... positioning statement. So that the “WHO…“ element sets up the main pain • Pain need or desire • Compelling reason to  buy experienced by the target customer and the “THAT PROVIDES…” section often outlines the solution or antidote to the pain. It’s worth stressing one more time that the positioning process should produce a description of your overall approach to the market so that a target customer feels that you, and you alone a) understand their problem b) have the most compelling solution. Ideally, they should be left feeling that you went into business simply to solve their specific problem. Page 9 
  • 12. Examples …THAT PROVIDES a reduction of up to 20% in data centre costs …THAT PROVIDES a 15% reduction in the time to bring new products to market …THAT PROVIDES complete alignment between corporate objectives and IT infrastructure …THAT PROVIDES complete, accurate and timely visibility into corporate risk etc. The impact of this positioning element is improved dramatically if the benefit can quantified or at least expressed in detail. There is often a temptation when creating this element to fill it full of technical features or justification. This is especially true of early market technology companies. Whilst it is a generally held rule that it is better to concentrate on what the product leaves behind (i.e. the benefit), it is OK to focus on the technical value of the product IF the target customer or at least the target audience within the target customer, is highly technically- focused. For those familiar with the SOA and ESB market only, I’ve reverse-engineered the positioning statement for Microsoft’s ESB Guidance product. According to their outbound marketing, Microsoft sees the following as the main benefit they provide their target customer (BizTalk developers): THAT PROVIDES an infrastructure for enabling service oriented architectures This example falls strictly into the “vanilla” category and certainly doesn’t really cut it as a compelling reason to buy. That said, for the target audience (technical) within the ideal target customer (BizTalk Developers), it represents a clear and (albeit overtly technically) compelling proposition. UNLIKE…The Primary Competitor or Alternative This particular element in the positioning statement is where the ideal customer’s alternative to our product is defined. First let’s see this element in the context of the complete positioning statement. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. Whilst this sounds straightforward – I typically hear… “It’s just the number one competitor, right?” In fact it actually requires a fair bit of thought, analysis, and planning. This element effectively recognises that the ideal client has a choice as to how they will go about solving their problem. This choice may include selecting a competitor’s product but it may also be that the ideal customer can solve their problem in a completely different way. The primary alternative from the ideal client’s perspective is captured in this element. In my experience this element is nearly always paired with the OUR PRODUCT element that follows it in the positioning statement. The combination allows the UNLIKE UNLIKE... OUR PRODUCT... element to define the primary alternative or competitor and the following OUR • Primary competitor  or alternative • Primary  differentiation / USP PRODUCT element outlines the Unique Selling Proposition benefits that differentiates our product versus the primary alternative. Page 10 
  • 13. UNLIKE alternative approaches to managing risk OUR PRODUCT not only manages risk but also reduces your corporate governance budget by up to 15%. This example assumes that the ideal client believes that they have a number of “alternative approaches to managing risk” We then go on to differentiate ourselves versus these alternative approaches because only we can “reduce the corporate governance budget by up to 15%”. I have seen and used many different approaches for this element and it is critical to understand who or what we need to be better than, or at least different from to convince the prospect to put their business with us. The key question to ask here is: “What does my ideal client perceive as their primary alternative (to my product) to solve their pain, need or desire?” This is key question. Many mistakes that I see in competitive marketing start by getting the perspective wrong here. It is critical to think from the prospect’s perspective and not from one’s own organisation’s perspective. Many marketing organisations typically think: Situation "What situation (needn’t be negative) does the ideal customer find themselves in?" Competition "Who do we compete with here?” Market Share “Who has the largest market share?” Similarity "Who has a product that is most similar to ours?” Analysts “Who do the analysts think we compete with?” Each of these approaches is internally-focussed and whilst answering them will certainly help with competitive marketing, the answer might not be that important to the ideal client. Approaches that I’ve used or seen for this element include: Competitor A key competitor Product A key competitive product Competitors A number of key competitors (it’s better to have a single defined alternative) Category A key category of competitor Alternatve An alternative approach to solving the problem Inaction i.e. doing nothing Examples …UNLIKE ACME Corp…. (key competitor) …UNLIKE ACMEProTurbo… (key competitive product) …UNLIKE ACME Corp and XYZ Inc…. (multiple key competitors) …UNLIKE relational database vendors…. (a key category of competitor) …UNLIKE other cloud computing vendors…. (other vendors’ approach in the same market category) Page 11 
  • 14. …UNLIKE using spreadsheets to manage data…. (an alternative approach) …UNLIKE outsourcing your data management needs…. (an alternative approach) …UNLIKE managing information manually as you’ve always done…. (inaction – doing nothing) Real world example For those familiar with the SOA and ESB market, I’ve used our REPAMA methodology to reverse-engineer the positioning statement for Microsoft’s ESB Guidance product from their outbound marketing communications. Microsoft apparently perceives the primary alternative to be: UNLIKE traditional ESBs… So Microsoft is using the “other vendors’ approach in the same market category” strategy listed above. This suggests that Microsoft believes that their prospect’s primary alternative lies with other ESBs and also that there is something about Microsoft’s approach to the ESB category that sets it apart from “traditional ESBs”. OUR PROUDCT…The Unique Selling Proposition I’m going to close out by looking at the pay-off, the crescendo, the exclamation mark at the end of the positioning statement – the USP or unique selling proposition. But first, and for one last time, let’s take a look at this element in the context of the complete positioning statement. FOR [the ideal customer] WHO [has this specific pain or problem] OUR [product name] IS A [product category] THAT PROVIDES [this main benefit and reason to buy] UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition]. USP is one of those over-used terms that has found friends at all levels of responsibility throughout sales and marketing organisations. I’ve heard everyone from line of business managers, to sales people to CEOs use this term. Everyone feels that they have a handle on it and over time the term has come to generically mean “differentiator”. Whilst I’m in favour of strategic marketing concepts finding friends throughout an organisation, there is a considerable amount of subtlety and craft missing from the common understanding of the USP. So let’s start with some definitions and perhaps a little bit of history. Rosser Reeves – what a great name. He sounds like he should have been a shady 1940s London underworld gangster. But he wasn’t. Instead he was an advertising man, one of the first in fact and it was he who brought us the concept of the unique selling proposition. For him, its use and definition were rooted in (print) advertising and as such the formal definition assumes that the USP is being used in some form of promotional campaign. Back then, there was also an implied assumption that we were dealing with business-to-consumer advertising too. Since then we’ve broadened the definition to think of it as any general proposition made via any medium (adverts, web site, emails, phone calls, face-to-face conversations, etc.) whether that be business- to-business or business-to-consumer based. Whilst the use of the USP may have changed, the disciplines and thought processes used in its creation are still valid today. The definition below is taken from the book Differentiate or Die (survival in our era of killer competition) by Jack Trout and Steve Rivkin. In this book the authors refer to Rosser Reeves’ 1961 work Reality in Advertising from which they quote Reeves’ three-part USP definition: Page 12 
  • 15. 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. to pull over new customers to your product). As I mentioned above, whilst many of these disciplines are still valid, there is now so much competition in just about every market category, segment and sub-segment that being unique is increasingly more difficult. So it’s no surprise that many of the USPs I see when reverse-engineering vendor’s positioning statements are often just SPs - with little or nothing unique about them. When looking at the USP in the context of the positioning statement it’s important to remember that the “OUR PRODUCT…” positioning element is typically paired with UNLIKE... OUR PRODUCT... • Primary competitor  • Primary  the “UNLIKE…” section. The “UNLIKE…” element sets up the main alternative or alternative differentiation / USP and the “OUR PRODUCT…” element describes the USP that the alternative doesn’t have. As shown below: UNLIKE [the primary alternative or competitor] OUR PRODUCT [has this unique selling proposition] The biggest challenge in defining this element of the positioning statement is in defining that unique space (number 2 on Rosser Reeves’ list above). With product categories, segments and sub-segments so granular across many markets and with ultra-competitive competitors competing within each of those segments, finding a position that only you can own is not the work of a moment. In addition it’s important to remember that we’re not just trying to find a unique space, but a unique space that has compelling value to the consumer/customer as outlined in Reeves’ point 1 above. In reality, in my experience of the infrastructure software space, what tends to happen is that the first entrant to the market (first mover) aims for something unique which is then “flatteringly” copied by later entrants to the market. To later entrants this makes sense as they want to have some of the pie of the first mover and are happy to trade uniqueness for being perceived as similar to the market leaders. Understandably it makes sense to look like the first mover. This tends to lead to what I call “standards-based marketing” and simply creates homogeneity of messages and propositions amongst the market protagonists. This leads to little real differentiation and leaves prospects studying highly technical features to really understand the differences between products. Examples …OUR PRODUCT removes up to 20% of data centre costs whilst reducing your carbon footprint …OUR PRODUCT starts reducing risk from day one. …OUR PRODUCT not only integrates with your existing systems but also provides comprehensive management capabilities …OUR PRODUCT ends world hunger (Well maybe not – but you get the idea) Real world example Here is an example from the REPAMA Segment Analysis Study into the ESB market. Microsoft’s USP section is shown below: OUR PRODUCT provides a superset of ESB functionality, extending the ESB pattern to include modelling and execution of business rules, workflow, and adapter integration. Page 13 
  • 16. Here Microsoft selects a pretty strong USP. They claim that UNLIKE other ESBs they provide extended functionality. Whilst other ESBs may legitimately say that they also offer extended functionality, these vendors may not actually be making that claim. So this certainly passes Rosser Reeves’ test above. The basis for this claimed USP is that their ESB Guidance is underpinned by their BizTalk product – which features broader functionality than other “simple” ESBs. I think this is a pretty well constructed USP – despite the fact that the rest of Microsoft’s marketing for the ESB Guidance is generally pretty poor. Perhaps this is a function of the non-product nature of ESB Guidance. In summary when defining the “OUR PRODUCT…” element we’re looking to communicate a specific benefit that will be delivered that none of the competitors or alternatives is able to offer, of at least they are not yet making the claim. All of this should be couched in language that compels the prospect to take action. Bringing it all Together So that completes the description of the positioning statement format that Lustratus uses to help our clients define compelling market propositions. So we’ll close out with a final look at the combined example positioning statement for Microsoft’s ESB Guidance. “FOR Microsoft BizTalk Developers WHO are building solutions that leverage the SOA pattern OUR Microsoft ESB Guidance IS A loosely-coupled messaging environment THAT PROVIDES an infrastructure for enabling a service-oriented architecture UNLIKE traditional ESBs OUR PRODUCT provides a superset of ESB functionality, extending the ESB pattern to include modelling and execution of business rules, workflow, and adapter integration” Further Reading Many of the general concepts in this document are explored in more detail in the following books: Differentiate or die – Trout and Rivkin, 2008 Positioning, the Battle for Your Mind - Ries and Trout, 2001. Product Marketing for Technology Companies - Butje, 2005 Page 14 
  • 17. About Lustratus Research Lustratus Research Limited, founded in 2006, aims to deliver independent and unbiased analysis of global software technology trends for senior IT and business unit management, shedding light on the latest developments and best practices and interpreting them into business value and impact. Lustratus analysts include some of the top thought leaders worldwide in infrastructure software. Lustratus offers a unique structure of materials, consisting of three categories—Insights, Reports and Research. The Insight offers concise analysis and opinion, while the Report offers more comprehensive breadth and depth. Research documents provide the results of practical investigations and experiences. Lustratus prides itself on bringing the technical and business aspects of technology and best practices together, in order to clearly address the business impacts. Each Lustratus document is graded based on its technical or business orientation, as a guide to readers. About Lustratus REPAMA Lustratus REPAMA is the marketing consultancy and competitive marketing intelligence division of the analyst firm Lustratus Research Limited. Whilst Lustratus Research provides detailed technology analysis, reports, insight and advice aimed specifically at end users of technology; Lustratus REPAMA helps technology vendors to better compete in their markets. The REPAMA research methodology is central to Lustratus’ consultancy services and provides a detailed map of the go-to-market strategies of the vendors in a particular market segment. We represent these strategies and tactics graphically as well as textually which makes it simpler to compare vendors’ strategies and to identify strengths and weaknesses. REPAMA is an acronym formed from the phrase Reverse-Engineered Positioning and Messaging Analysis. Lustratus REPAMA services clients worldwide from its base in the UK. http://www.lustratusrepama.com/. Terms and Conditions © 2009—Lustratus Research Ltd. Customers who have purchased this report individually or as part of a general access agreement, can freely copy and print this document for their internal use. Customers can also excerpt material from this document provided that they label the document as Proprietary and Confidential and add the following notice in the document: “Copyright © Lustratus Research. Used with the permission of the copyright holder”. Additional reproduction of this publication in any form without prior written permission is forbidden. For information on reproduction rights and allowed usage, email info@lustratus.com. While the information is based on best available resources, Lustratus Research Ltd disclaims all warranties as to the accuracy, completeness or adequacy of such information. Lustratus Research Ltd shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. Opinions reflect judgment at the time and are subject to change. All trademarks appearing in this report are trademarks of their respective owners. Page 15 
  • 18. Lustratus Research Limited St. David’s, 5 Elsfield Way, Oxford OX2 8EW, UK Ref DG/LRS/NA/V1.0 Tel: +44 (0)1865 559040 www.lustratus.com

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