Positioning Process

Agenda

• Need

• Company Positioning

• Product Positioning

• Validation – 3 Statements that validate your “unique” value

proposition

• Solidify

• Train (memorize) and “become”

Positioning

• Win Before & After Development – The apex of all strategy is to determine your unique distinctive

competence (unique value proposition) – your positioning• At CEO/VP Marketing Level – Product is the “Company”• At Product Management Level – Product line

– Positioning – “Why would anyone want to buy ‘us’”– The best way to launch your product, is to position it “before” it is

developed—by building your selling hooks (the biggest problem solved) into the product in advance

– If you inherited a “me to” product, you MUST find (and articulate) a unique position before the launch materials (or you have nothing to promote!)

Need for Positioning

• Company/Product Positioning– Answers the questions

• Who are you?• What is unique about you—how do you compare?• What do you do?

– Test• Who is Panviva? • What is so unique about your company, your product?

– Your “unique” value proposition

– What is your elevator speech (30 seconds)

Company Positioning

• What promises do our prospects expect from a company like us?– List top five

• What promises can we honestly keep?– Not what are we currently keeping, what can we keep if we

decide or want to– Which will give us the competitive advantage

• Solidify and wordsmith these– Now – EVERY action, decision, customer interaction, policy both

internally and externally follows these promises– You “become” what the market wants (not a person, a “thing” so

there is no identify problem

Company/Product Tag Lines

• Identity (what they make) known– Microsoft – tag line– Sun – tag line

• Descriptive (answers, “who are you”)• Positioning (#1, most, leader)• Rules of thumb – 7-9 words (billboard)• Association

– Tied to corporation• Tivoli – An IBM Company• Metrowerks – A Motorola Company

– Acid test… worth more with, or without– Acquisition – watch out don’t loose existing equity in the

transition

Product Positioning

• The apex of all strategy• How it is positioned within the field of

competitors?• What is the unique differentor?• Examples:

– Crossfax – a hook was built in– Codewarrior for Windows – no hook, made one

• Name reflects positioning – if possible. If not, tagline reflects it. 3 validation statements “prove” it.

Positioning - Strategy

• “The answer can be right in front of your eyes.” Legend of Bagger Vance (See this movie!)

All products shown copyright of their respective owners.

Find the clear path to the hole!Find the clear path to the hole!

Positioning - Strategy• How to

– Do you homework (previous variables)– Immerse yourself – When you hit the ball 45 degrees to the right, and it turns and goes

in the hole – you have seen the strategy (Tiger Woods)– The moment will come, everything else will blur, and you will “see”

the answer. It will become clear. You will see the path to the hole!– THIS is the ultimate moment– Your strategy becomes clear– Now…

• Articulate it!

• Execute

Positioning Case Studies

• Dev Tools

• E-mail Maintenance

• Advanced Set-top

• CrossFax

• Scratch Out

Positioning

• Case Study #1– The product manager is the case study--not the software

– CodeWarrior for Windows (an IDE for software development)

– Developed by copying Microsoft’s features

– The Product Manager’s positioning, “Just like Microsoft.” (buzzer goes off, ton of bricks fall)

– When challenged, “it is cheaper” came out (bricks…). Lower the price is NOT a differentiator (a difference shouldn’t take seconds to match)

– Didn’t work, only 2% market share. Reason? The PMM said, “Missing a few of Microsoft’s features.” (buzzer…)

– What is wrong with this product’s positioning?• Hint – it wasn’t determined before it was developed and turned into a

“me to” (non-differentiated product)

Positioning

• Case Study #1– How do you sell (promote) this software?– You MUST still position it (after the fact)– How? What are the most unique features of the product that are

valuable to the user (and that they will PAY for)?– Through homework (research) we found something unique (not

brilliant, but unique).• Our product was better at cross-development between Windows

and other platforms

• For those porting Window apps to Mac, Linux, Nintendo, or any embedded system…we had a unique advantage.

Positioning

• Case Study #1– The ability to use a similar IDE

interface and to port to multiple platforms was our distinct differentiator.

– We were also faster, and had a few unique characteristics, but the cross-platform approach was the most defensible differentiator.

– Leveraged with competitive matrix

– Offered a “no risk” option

– Promoted “sizzle” (more later)

Positioning

• Case Study #2– DCA (5th largest software company at the time)

• CrossTalk, #1 rated terminal emulation software• CrossFax – Added to CrossTalk for Windows• Competed against Winfax

– I had launched 2 prior versions of Winfax so I knew it’s capabilities & weaknesses

– Had to determine the unique differentiator to build in (since we “bought the product”, rather than developed it)

– Variables to research include a) product features (comprehensive matrix), b) price (especially terms), c) distribution & supply chain (direct, indirect, conflict, reseller loyalty), e) promotions (how well can they promote)

– Looking for gapping and subtle holes that are not being addressed

– MUST “see” the positioning strategy – a clear path to the money

Positioning - Example

• Example of CrossFax - Validation– Chrysler wanted to broadcast fax their brochure via

local dealers– Winfax had two critical flaws

• Could not broadcast faxes w/out crashing• Could not fax grayscale

– This is how we positioned ourselves against Winfax…

Positioning - Example This is a re-creation. The actual fax from Winfax was MUCH worse (almost unrecognizable)

Positioning - ExampleRe-creation of the original fax.

In contrast, CrossFax has never crashed during a broadcast fax…EVER!

Positioning - Example

• Did it work?• Yes! Chrysler selected CrossFax for a 20,000 user license!• Similarly, you must find a marketing hook, a unique differentiator

that the user values and is willing to PAY for (like Chrysler)• Key takeaway: It is best to do your homework and find out what

prospects want in advance, so you can build it into your product.– If you didn’t build valuable differentiators in, you have less leverage to

promote later (i.e., CodeWarrior)

– Regardless of what you have, it must have a unique position to promote

– I am typically called in because there is a PROBLEM• I seldom get to help position a product prior to development. I’m usually

stuck trying to find a position (a market) for products that were not positioned and articulated originally. In psychology this is called “Reality Therapy.”

Positioning: Best = Worst Case

• Example– E-mail storage

• Problem: mandated by law to store it (post Enron). Penalized ($50 million case) if you don’t.

• Current Solution: Archive. Backup nightly (every 24 hours)• Major Hole: Avg 81 e-mails received daily (non-spam).

Assume ¼ are “important”. Equals 20 / day x 500 person company = 10,000 LOST e-mails between backups!

• …and if your backup fails (42% fail), or your Exchange database is corrupted (72% surveyed have had an Exchange disaster)?

Question: What is the next phrase out of your mouth after you tell your CEO you lost TEN THOUSAND e-mails?

Positioning – Example NEW

• Answer: “Would you like fry’s with that?”

(Former IT Manager after loosing 10,000 e-mails!)

All products shown copyright of their respective owners.

De-Positions Alternatives

• Problem: Reduce the risk of loosing 10,000 e-mails

• Solution: DigiVault (by Lucid8)– Continuous Data Backup

(CDP)

– Loose 1-4 minutes of e-mail, not 24 hours

– Plus, restore takes apx. 20 minutes, not 3-5 hours!

– Similar cost, negligible loss, much faster restoration

• Benefit: Lose 10,000 e-mails or 17. – Which would you prefer?

De-Positioning

• What does De-Positioning mean?– Articulate your own strength in contrast to your

competitor’s weakness (specific or ALL)• CodeWarrior for Windows – best for cross-platform• CrossFax was made to look stronger against Winfax• DigiVault looks much better than ALL of the 24 hour backup

alternatives

– The strength of your positioning makes the alternatives look foolish in comparison

• “Negative” campaigning still works

Political positioning, “It’s the Economy, Stupid!”

Single in on the most critical differentiator

De-Positioning the Competition

• How to De-Position the Competition? Basics…– Comparative matrix (Tom Cruise charts)– Positioning grids (Gartner’s Magic Quadrant)– Associate “them” with Negative imaging– Capitalize on Major flaws & Mistakes (actual or perceived)

• Intel inside – a warning label, or much slower dual-core• SalesForce.com (Ad with Dali Lama)• HRW – Competitor’s mistakes in textbooks ($10k/error)• Democrats w/Bush (War, Immigration, Wire tapping)

– Sometimes your best positioning is the weakness of the competition (you’re not that good, just better than “them”)

– Art of War. MUST be honest and ethical, but it is war. Compete against the product and company—not the people (will need to recruit them (part of your counterstrike campaign))

De-Positioning the Competition

• Comparative matrix (Tom Cruise charts)

De-Positioning the Competition

• Positioning Grids (deposition competition)

De-Positioning Case Study• Price positioning – always an objection

– Arm sales with product price positioning (set-top box example)• Companies set-top was $800• Competition was $200

• Q. How can you “promote” your price?• A. Change the perception. Switch the criteria from price to “cost” or

“revenue potential” and promote how much more they will make.

0

50

100

150

1999 2001 2005

E-Commerce T-Commerce Interactive Services

PPV I-TV HIS Enhanced Services

High Speed Internet Standard ISP Long Distance

Features Local VoiceCable/DBS TV

24%

Long Distance20%

Cellular12%

Local Phone29%Internet

7%

Local Toll4%

Paging2%

Calling Card2%

“Our” system produced up to $129/mo In revenue. Competitors generated only $59. It required $79 for their business model to work. We produced over $3,600 more revenue/5 years—after the difference!

De-Positioning the Competition

• Positioning Grids (Negative Imaging)

Sometimes it takes creativity to “see” the absolute killer positioning. This one took over 6 months to see… and then was irrefutable.

All products shown copyright of their respective owners.

• Two existing approaches to repair– Chemical Softeners

• Maxell, Memorex– Repair minor read errors only

– A majority of the online reviews are negative

– Mechanical Grinders• Opti Fix Pro – Memorex• SkipDr Advanced or AutoMax

– Works for minor scratches, but deep scratches require grinding the entire disk multiple times and can take a LONG time to remove—if at all

– Versus taking seconds to repair with Scratch Out

De-Positioning Alternatives

Why Order ScratchOut?

• First – it works! – Unlike existing products that claim

to repair, but don’t work on anything but the smallest scratch, ScratchOut restores a disc to 100% playable, 100% of the time

– Uses commercial grade polishing agent to remove unseen microscopic damage to optical disc

– It’s not the “mountains” that cause the laser to misread the disk - it’s the ridges within the mountains

– These ridges are polished smooth with ScratchOut

Product Positioning

• The undisputed Price/Performance leader - and the product actually works!

• NEW approach – completely unique microscopic polish (not a filler, cleaner, or grinder)

• GUARANTEED 100% playable, 100% of the time (if it can be fixed, we can fix it)

• ONLY product to repair light to severe scratches*

• OPTIMIZED for impulse buying (price, packaging, location options)

• Undisputed Price / Performance LEADER

* SkipDr (disclaimer on packaging) “…will not repair severe damage, such as gouges and deep scratches”

De-Positioning Specifics

• SkipDr - Mechanical Grinders– The mechanical grinders look

techy, but they sand the entire disk. They cannot fix just a “single” scratch.

– Would you wash your favorite shirt 10 times in a row just to get a single area clean?

– Why spend all the time to grind and sand an entire disk numerous times just to remove a single scratch… that takes seconds to fix with ScratchOut.

De-Positioning Specifics #2

• Opti Fix - Chemical “Softeners”– Typically a diluted Acetone-based chemical that

softens the top layer of the optical disc to “smooth out” the scratches.

– Only works on minor scratches – if at all– Does more to clean the disc than to actually repair it– Does not repair moderate to severe scratches– VERY bad online reviews– Few return purchases – bad for “consumable”– Old technology, old approach, poor results

Positioning Matrix

Positioning Quadrant

Positioning Dialogues

• One

• Two

• Three

Validation

• Prove it!• List 3 validations for your company• List 3 validations for your product

– Validate with features/benefits – what makes your product so unique that your prospects MUST buy it?

– 1,2,3

• These valuators now go into your elevator speech, your collateral, your website, your discussions with the press. You are on your way.