Most people fundamentally misunderstand positioning.
The seminal text on the subject was written in the 1980s, before the internet was a significant part of our lives. And its authors simply defined the concept, rather than providing a manual for how to execute it.
That’s why April Dunford is writing a book to show startups how to position themselves better and to teach them that positioning is an ongoing exercise – not something that goes away when the deal is done.
As the founder and CEO of Ambient Strategy and a seasoned marketer and executive at both startups and Fortune 500 companies, April has launched 16 products, the vast majority of which were wild successes (with a couple of flops that provided essential lessons along the way).
April joined me at the SaaStock conference in Dublin to record a live podcast, where we talked about everything from what people get wrong about positioning to how to stand out in a crowded space. Short on time? Here are five quick takeaways:
- People often confuse positioning for branding or messaging, when actually it’s the definition of your go-to-market strategy. The most common symptom of weak positioning is people just don’t understand what you do, or you get compared to competitors who aren’t really your competitors. You must be clear about the market you’re trying to win and which customers you’re targeting.
- Marketing pixie dust cannot solve all problems. April points to two scenarios when it might be time to pivot: sometimes the market is too narrow, and the numbers just won’t work. On the other hand, there might be a hot market for your amazing product, but dysfunctional team dynamics ruin it. If you encounter these scenarios, it might be time to focus your efforts elsewhere.
- To get to a eureka moment, you have to position yourself to attract the right kind of business by clearly explaining what you do and whom you’re for. Your messaging also has to be consistent at all levels so no one gets surprised. You want the bad deals to drop out quickly and the good deals to move along fast, because everyone’s clear on why you exist.
- The best way to stand out in a crowded market is to hone in on your secret sauce: the thing you do better than anyone else. Many SaaS vendors get into trouble when they try to be all things to all people – and they end up looking just like everyone else.
- April’s advice for young marketers is to think about the big picture before rushing into tactics. Spend less time thinking about marketing and more time thinking about markets.
If you enjoy our conversation, check out more episodes of our podcast. You can subscribe on iTunes, stream on Spotify or grab the RSS feed in your player of choice. What follows is a lightly edited transcript of the episode.
Geoffrey: April, welcome to Inside Intercom. You’ve held executive roles at a dozen incredible companies. Could you give us a run down of how you got to where you are today?
April: Yeah, I’m kind of a repeat executive at a series of startups. I was a CMO, a COO and a CEO one time as well – at seven different startups. Six of those seven got acquired. That resulted in me ending up at four different Fortune 500 companies. Now I’m a consultant, and I work mostly with tech companies, and my specific area of expertise is positioning. I have a long, crazy career in tech.
I think I’m more wired for startups to tell you the truth. But I learned a lot from working at Fortune 500 companies. You learn what you would do if you had all the money and all the resources and all the people and it’s interesting to look at that as a best practice and then say, “Well, we don’t have any money or any people or any resources, so we’re going to try to get the same result by being scrappy and do it that way.”
I learned a lot at big companies but one thing I didn’t like was that the roles were really narrow. When you work in a big company, you’re generally responsible for one really narrow thing. Whereas in small companies, particularly if you’re executive, it’s expected that you’re going to get your hands in a lot of different stuff. Different stages of the company, work is differently, so you end up getting exposed to a super broad set of things to do which is way more fun – at least for me.
Geoffrey: Talk us through what your degree in systems design engineering has taught you about your career as an executive or as a marketer.
April: I did a degree in engineering, but I don’t think I was really sure what I wanted to do after I graduated. I had massive student debt. I needed to get a job, and I happened to have a friend who worked at a startup, and she recommended me for a job. It happened to be in the marketing department.
At the first job I had, we were selling a database. They needed someone who could stand on stage and demo a database, which is like the most boring demo you’ve ever seen. I’m literally writing SQL queries on a stage. I did that for a couple years. They liked the idea of hiring an engineer to do it, but they wanted someone who wasn’t afraid of public speaking. That company got acquired. I ended up running marketing after my boss quit.
Two years out of engineering, here I am running this big global marketing organization, and at the time I thought: “How hard can this be? I’ll just figure it out.” And it turned out it was really, really hard. It’s amazing I didn’t get fired, but I didn’t. From that point on, I thought: “Hey, this is my bag. This is what I do. Tech marketing is my thing.”
What people misunderstand about positioning
“The underpinning of all good marketing and sales is strong positioning, and yet it is such a misunderstood concept.”
Geoffrey: And you’re currently writing a book on positioning?
April: As a consultant, I’ve focused on positioning. Mainly because I feel like the underpinning of all good marketing and sales is strong positioning, and yet it is such a misunderstood concept. There is no good book on positioning right now where I can point the companies I work for. There was a book that was written in the early ’80s called Positioning: The Battle for Your Mind by Al Ries and Jack Trout. Everyone’s read it.
That thing was written before the internet; it’s so old. And all it does is define what positioning is. It doesn’t tell you how to do positioning. The goal of my book is to give you a handbook so you can say, “Not only do I know what positioning is, now I can actually I can attempt to go and do it for myself.”
Geoffrey: Take us back to Al and Jack’s thesis back in 1982. Has anything really changed since then?
April: Well, a lot has changed in terms in how crowded our markets are. Ries and Trout talked a lot about how you needed to be able to position your strengths and weaknesses rather than your competitors’ strengths and weaknesses in order to stand out in a market. If you read their book, they’re talking about how crowded markets are in 1982. Well, if you thought they were crowded back then, you should see what we have now.
I think we need positioning more than ever. The concept is super relevant right now. I just think it’s poorly understood. Often, people will confuse it with branding or writing a tagline or messaging when it’s actually the definition of your go-to-market strategy: “This is the market we intend to win. Here’s how we’re going to win it. These are the customers we’re targeting.” These are big business strategy questions that startups in particular often don’t think about consciously. Then they have problems in marketing and sales down the road.
Geoffrey: Let’s take a hypothetical example: say you’re launching a brand new product tomorrow. What are the first steps you’re taking to understand how to position it?
April: Most companies start with an idea to make an existing thing better. They’ll say, “We’re going to build a better email system.” Or, “We’re going to build a better CRM or a faster database.” They iterate on the product, and they get it into the customer’s hands. The customer says: “I love these features. I hate these features.” After they go through this period of monkeying around with the product, they have something customers love, and they start selling it.
Often, they never revisit that positioning. They just say: “We started out to build a database. This is obviously a database.” Or they’ll say, “It’s obviously a CRM.” But quite often – if you were the customer having no prior experience with it – you might look at and think, “No, that’s not CRM, that’s chat.” Or, “That’s not email, that’s team collaboration.” What startups need to do is to be able to back up and say, “If I put my customer hat on, what is the best context I could weave around this product so that it makes sense to people when they first encounter it cold?”
How to spot weak positioning
Geoffrey: As a consultant, are there particular mistakes or challenges people are coming to you with when it comes to positioning?
April: Most of the time, weak positioning manifests itself in a bunch of ways. The most common symptom of weak positioning is people just don’t understand what you do, or you get compared to competitors that the company says aren’t your competitors at all. And yet customers keep thinking you’re just like them. You’ll see this weakness in the funnel in different ways.
Often, it’ll be difficult to get a lead into the funnel because people don’t understand what it is. And then sometimes, what you’ll get is a lot of friction in the middle of the funnel, where you can see customers wrestling with the question: “Is this really what I need? Is this really what’s going to solve my problem?” Then you’ll get a lot of churn on the backend where they think you do one thing, but when they actually get their hands on it they’re like, “Whoops, this is something else.” And they’ll churn out on you. You tend to see those symptoms quite a bit.
Geoffrey: Is there a particular product – either current or historical – that you think is the perfect example of positioning?
April: There are a lot that I use as examples. There’s a company in Canada that builds essentially autonomous vehicles for manufacturing plants. They did an interesting shift in positioning because they started out saying what they did was robots or robotics. But the problem with that is that, in the context of manufacturing, a robot is a stationary thing. It doesn’t drive around. It’s not particularly complex. They shifted their positioning to more of this idea where this autonomous vehicle or self-driving car for inside a manufacturing plant. That shift really changed the mindset of customers about what the product is, what’s the competition is, and what the value is. I think they’re a neat example.
How to learn from flops
Geoffrey: You launched close to 16 products over the course of your career. How do these add up? Fourteen of them have been successes and only two flops so far.
April: Two flops.
Geoffrey: Could you bring us through the self-proclaimed flops and what you learned from them?
April: The two that were flops were flops for completely different reasons. The first one was actually a great product in a really narrow, small market where it was impossible to make any money. So, the total addressable market for this thing just wasn’t big enough. We were one product in, and there were three products in the family, and it was clear that we were never going to make enough money to even support having two developers on this single product.
We were selling through distribution, so the margins were terrible, and I worked the spreadsheet on the business plan. I said, “I can’t even pay for my two developers, let alone me and my desk and the other things.” So, my recommendation to the CEO was that we shut it down or we attempt to sell it. He wasn’t super happy with that idea when I first presented it to him, but I convinced him by showing him the data over and over again and letting him know, “Look, we’re never going to make any money on this.”
We had another product, on the other hand, that was growing like crazy with a giant addressable market. We ended up selling the other product for a million bucks, if you can believe it. We took that million dollars and poured it into the product that was growing, which was ultimately super successful, and they were acquired. For me personally, it didn’t work out so well. I didn’t have a job after they sold it, and that was a bummer. That’s what you call taking one for the team. That was the first flop.
Looking back on it, I think we did the right thing. So the lesson there is that sometimes you can take a product and position it into a better market. And sometimes the thing is just narrow, and if you can’t make the numbers work in any fantasy scenario, they’re just not going to work. So you should just quit that and do something else.
The second flop was a completely different thing – more about team dynamics. I came in, and again the product was spectacular: they had patents on it, and it was really neat technology. It was in a space I knew a lot about, and I fell in love with this product when I first saw it. I was like, “Oh, this thing is gonna be super successful.”
But when I got inside, it turned out the company itself was really broken. The lead investor and the founder were fighting. Eventually, the founder got fired and was replaced by a new CEO who didn’t get along with the management team. We couldn’t get out of our own way to make that thing successful. I ended up leaving there, and the product was a flop. The big lesson I learned from that was that marketing pixie dust cannot solve all problems, and sometimes team dynamics can take something that’s even completely magic and turn it into a pile of poo, because we just can’t get out of our own way to make the thing successful. Team dynamics matters a lot in a start up. After that, I did a lot more assessing the team and tried to fall in love with the product less.
“Marketing pixie dust cannot solve all problems”
Geoffrey: Would you say that you learned as much from the two failures as you did from the 14 successes?
April: Yeah, for sure. I mean, you learn something on all these. These things never go the way you think they’re going to go. Even with the ones that are successful, it’s not all sunshine and roses the whole way through. There’s a lot of failing on the way to succeeding, so you learn through that too.
The ingredients in a good client
Geoffrey: And you’re consulting with your company, IBM Strategies; what are the three ingredients you look for when choosing a particular client that you would like to work with.
April: Yeah, I only work with tech companies, because technology sort of my bag. I only do B2B because I only ever have done B2B and so I don’t get B2C. That’s like weird, magic stuff. I only do positioning work, because I’ve decided that’s my favorite thing to do, so that’s all I’m going to do. I do a bunch of pre-screening so that I can convince myself: “Yep, you have a positioning problem, I can help you solve that.” Usually it takes a few phone calls for me to get my head around what I think the problem is. Sometimes, it’s not positioning. Sometimes, it’s execution. Sometimes it’s just a crummy product. And if I don’t think we can fix it with positioning, then I usually say no.
The great thing about doing consulting later on in your career is that you get to be picky about whom you work with. I’m super busy. I get a lot of calls. I do a little bit of asshole screening. Do I think that they’re going to be fun people to work with? Are we all going to get along? Are we going to have a good time when we’re working together? And if the answer to those questions is no, then I usually say: “You know what? I think your positioning is fine.”
And they have to like me too, right? We’re all weird, startup people. We have to make sure we’re the same kind of weird while we’re on the phone, so we’re going to have a good time working with each other. I’m getting old; life is short. I don’t have time to waste if we’re all going to have a bad time.
How to get to eureka
Geoffrey: Yeah. When you’re marketing and selling a B2B product – especially the enterprise products that you have deep experience in – the sales cycle is obviously longer and more complicated than a B2C product would be. How do you use positioning to help prospects get to that magic moment over the course of what could be weeks or even months?
“You want the bad deals to drop out quickly and the good deals to move along fast”
April: Oh, it takes months – years in some cases. There’s so much you can do around positioning and different stages, particularly in a big enterprise deal. First you have to position yourself to make sure you are attracting the right kind of business in the first place, so you’re not wasting your marketing people’s time or your sales people’s time trying to sell stuff to a customer who is clearly not a good fit for what you do. I think in your marketing messages and your value propositions in the customer stories that you choose to highlight, all the things you do to capture a lead and bring a lead in, should continuously be reinforced the positioning of this is what we do, this is what we’re good for and this is who we’re for. If you don’t fit these things, then you shouldn’t be here.
When you get in the middle of the funnel, particularly on an enterprise deal, you’re generally working with a lot of different people, and deals are complicated. There’s not just one buyer, there are multiple buyers. And everybody needs to understand that. There’s a lot of consistency and repetition, and you have to make sure your sales reps are saying the same thing as your marketing material, which is saying the same thing as your CEO who goes in to close the deals and everything else. You end up spending a lot of time making sure that we’re delivering this really consistent message so that nobody’s surprised later. Like, “Oh, I thought you were this and you didn’t do this.”
You want the bad deals to drop out quickly and the good deals to move along fast, because everybody’s clear on what this thing is. And even when you get down to closing an enterprise deal, it’s funny because most big enterprises will have a Purchasing Department, and you’ll get all the way through this deal and Purchasing will lean over and say, “So what are you guys, again?” You’re like, “Oh, damn. We have to start this all over again.” Even when you get down to purchasing and legal – even those teams inside a buyer need to understand clearly who you are, what are the comparables, and how they decided to make this purchase decision.
Geoffrey: Does positioning extend beyond signup as well, making sure the marketing message that they’ve been sold on is actually correct?
April: Yeah, you actually do the thing that you say you do. That’s super important. It’s really important for onboarding too. When you think about when a customer gets started on your stuff, they need to get to this moment where they see, “This is the value I’m supposed to be getting out of this.” They need to get that quickly. Then from a positioning prospective – particularly in SaaS – you’re not done when you close the deal. You have to make sure that when renewal time comes up, the customer still understands why you are the best solution for this particular thing and not some other product. You can’t let the customers get confused about whom to and whom should you not be compared to. I think the job is never done.
Standing out in a crowded marketplace
“You can’t let the customers get confused about whom should you be compared to and whom should you not be compared to.”
Geoffrey: When features, products can be replicated so easily, positioning becomes so much more important. For our listeners, is there any sort of advice you’d give them to stand out in this particularly crowded marketplace?
April: I think the best thing B2B SaaS vendors can do is stay really focused on their differentiators because there are things about your solution that your best customers really love about you, and the rest of it really doesn’t matter. I know we want to talk about all the things, but the best thing to do is just to hone in on your secret sauce: “This is the thing we do better than anybody else. If you don’t care about this stuff, we’re not the solution for you.” Most B2B SaaS vendors get into trouble when they start to tell me about every single little thing about what they do, and some of it’s their secret sauce and some of it’s just meh – it’s just like everybody else’s thing, but they’re trying to sell too much stuff. What happens is you end up looking like everyone else.
So, I think it’s important for SaaS companies to get their best stuff out front. Then you’ve got lots of time later to do the checkbox for the nine million other features you’ve got. You can worry about that later. If people understand your core value and your core differentiators, then you’ll stand out on your own from all these other folks who are like, “Hey, we’re everything for everybody.”
Geoffrey: Reflecting on your career as a seasoned marketer and executive, if you were to give April of 10 or 15 years ago one piece of advice what would it be?
April: That’s a good question. People ask me that a lot on podcasts. I think you get that question when you’re old; I wonder if I get that question when I was in my 20s? If I went back to young April, there are probably two things. One is that, at the beginning of my career in marketing, I was way too hung up on tactical execution. I see this as a common thing with younger marketers whom I mentor now. They’re like: “I’m going to do SEO. We have to keep up on all the SEO stuff. We’re going to be really, really good at that one little SEO thing.” It’s not that tactical execution isn’t important; it is. But it’s actually the easiest thing. The hardest thing is the bigger picture stuff. Are we even in this business? Why are we in this business? Why do we win deals? I wish I had of spent more time on those bigger picture things because we rush to get into tactics. Less time focused on marketing and more time focused on markets, I think is the advice I would have given my younger self.
Then the second thing is that the way we think about a product is super flexible. The product itself isn’t. The product is what it is. We have a roadmap, and we’re going to build things and add things to it and maybe do an acquisition or something. But if you really want to change things quickly, it’s much easier to change the frame of reference and change the way you think about the product than it is to actually change the product. Generally, if you’ve got a product and there’s a bunch of happy people out there, you just have to figure out why the people are so darn happy. There’s probably a mismatch between the way people think about your product and what your happiest customers see.
If I had to go back to my younger self, I think I’d be worried more about these big-picture things than when I was younger. I got really hung up on thinking: “Oh, this product is crap. If it only had these three more features, it’d be so much easier to sell and be better than that other thing.” But in fact, there’s so much stuff you can do by just shifting the context and frame of reference and focusing on what you’re good at right now.
Geoffrey: To your earlier point, it’s probably easier to shift the frame of reference at the startup than a Fortune 500 company.
April: Absolutely. Although, at Fortune 500 companies you get to do all kinds of fancy stuff like locking the Gartner Group guys in a room for three months and just throw money at them until they say what you’re saying. Not that I’ve ever done that.
Geoffrey: April, thank you so much for your time. It’s been enlightening.
April: Yeah, thanks. It’s been great.