the positioning statement - a description of the lustratus positioning statement and its constituent...

8/14/2019 The Positioning Statement - a description of the Lustratus positioning statement and its constituent parts (1.00)

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REPAMA

A description of the Lustratus

positioning statement and its

constituent parts

The Lustratus REPAMA

Positioning Statement

Author: Danny Goodall

Version 1.00

December 2009


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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

FORThe Ideal Customer ................................................. 4

Examples ............................................................... 5

WHOPain, problem, need or desire ................................ 6

Examples ............................................................... 6

OURProduct Name ........................................................ 7

IS AProduct Category .................................................... 7

Examples ............................................................... 8

THAT PROVIDESThe Main Benefit or Reason to buy ..... 9

Examples ............................................................. 10

UNLIKEThe Primary Competitor or Alternative .............. 10

Examples ............................................................. 11

Real world example ............................................. 12

OUR PROUDCTThe Unique Selling Proposition ........... 12

Examples ............................................................. 13

Real world example ............................................. 13

Bringing it all Together ..................................................... 14

Further Reading ............................................................... 14


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DisclaimerWhilst 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 bythe 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 ofcompanies 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 .


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IntroductionThis document is based on a series of blogs taken from http://www.lustratusrepama.com/repama-blog thatdescribe 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 reverseengineered using our REPAMA methodology. These examples are taken

from our ESB Segment Analysis Study but it shouldnt 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 [email protected] for details of how we can help you achieve a compelling and

competition killing proposition for your prospects.


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The Positioning StatementOver the years, having worked with some of the best product marketing people in the industry, Ive 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 Ive seen and

used have had a very similar structure which we will examine below. Having said that, I have also seen someexamples 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?Its 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. Its 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 theproduct/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 theproduct

The primary competition or alternative The unique selling proposition (USP)

The format of a positioning statementA 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].


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So the FOR, W HO, OUR, IS A, THAT PROVIDES, UNLIKE and OUR PRODUCT elements give our positioning statement the structure it needs.

An example positioning statementAn 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 weve attempted to

capture Microsofts position and proposition in the ESB market.

FOR Microsoft BizTalk DevelopersWHO are building solutions that leverage the SOA patternOUR Microsoft ESB GuidanceIS A loosely-coupled messaging environmentTHAT PROVIDESan infrastructure for enabling a service-oriented architectureUNLIKE traditional ESBsOUR PRODUCT provides a superset of ESB functionality, extending the ESB pattern to includemodelling and execution of business rules, workflow, and adapter integration

Its notoriously difficult to be precise when reverse-engineering a vendors positioning statement and sections

like the THAT PROVIDES and OUR PRODUCT are especially difficult to define precisely. Buthopefully 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.

FORThe Ideal CustomerHere we will take a look at the first element of the positioning statement - the ideal target customer. Lets firstrevisit 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 Ill 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 Microsofts ideal target customer was defined as:

FOR Microsoft BizTalk DevelopersBetween you and I, this is not the most definitive classification of ideal customer Ive ever seen, but when

reverse-engineering a vendors implied positioning from their outbound marketing communications, its often as

close as we can get. I suspect that Microsofts 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, were 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:


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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 were attempting to do here is to segment the total available market so that we end up with a segmentthat 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.

Industry/Vertical Canyoudefinetheindustryorverticalmarketthattheidealclientbelongsto?

Geography Wherearetheybased?

Size Whatsizeoforganisation? byrevenueoremployees

Reach Thereachofyourorganisation local,regional,national,multinational?

Budget Istheclientabletobeclassifiedintermsofhowmuchmoneytheyhavetospend?

Pricing Aretheysensitivetoprice?

Jobtitle Whatistheirposition/jobtitle?

User Whowillusetheproduct?

Decisionmaker Whomakesthedecisiononthistypeofproduct?

Image Whatimagedoesthisclienthave? Leadingedge,conservative,wellknow,leaderintheirownmarket.

Benefit Whatwilltheproductdotoimprovetheclientslife?

Reasontobuy Whatcompellingreasondoestheclienthavetobuytheproduct?

UseWhatothercomplimentaryorcompetitiveproductsaretheyusing?

Concerns Whatarethemainconcernsofyourtargetclient?

Businesstype Whatistheirtypeofbusiness?

Businessmodel Whatistheirbusinessmodel?

Competition Whoistheircompetition?

Clients Whoaretheirclients?

Problems Whataretheirproblems


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WHOPain, problem, need or desireThe W HO element of the positioning statement is the pain, problem, need or desire that we believe thattarget customer is looking to resolve. Again, so that we have a context for the discussion, here is the

positioning statement format that Lustratus uses.


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 prospects mindwhere our products and services uniquely sit. We did this by first identifying the ideal customer. Now were

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 W HO element describesthe situation, nearly always negative, that the ideal customer finds themselves in. The implication is that we can

positively alter the ideal customers situation.

The following questions often help to narrowing down the W HO element of the positioning statement:

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 Microsofts W HO 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 BizTalkDevelopers) finds themselves in is that of

building solutions that leverage the SOA pattern.

Interestingly, in our attempt to reverse-engineer Microsofts 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

Aspiration Whatistheidealcustomerlookingtodoorachievethattheycannotdowithouthelp?

Need Whatmusttheidealcustomerdothattheyarestrugglingtodo?

Desire Whatisthedesiredstatethattheidealcustomerislookingtoachieve?

Problem Whatistheproblemthattheidealcustomeriswrestlingwith?

Situation Whatsituation(needntbenegative)doestheidealcustomerfindthemselvesin?


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Progress with its Progress Sonic ESB product identifies this need

WHO need to connect many different IT resources using many different technologies in manyphysically 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:

W HO are struggling to implement the latest governmental regulation W HO need to remove costs from their IT operations W HO fail to bring new products to market ahead of their competition W HO are unable to ascertain their risk exposure in a timely manner W HO cannot currently meet their corporate governance requirements etc.

OURProduct NameThis is one of the supposedly easier elements to define, where little specific planning or strategy is needed. Here

were looking at the OUR [product name] section of the positioning statement. So as above lets look at thecontext of this element in the wider positioning statement.


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 doesnt usually change based on the ideal customer or the pain that they have, it

might be that specific products are createdso as to appear focused on a specific audience and/or problem.

Ive 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 youre 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. Its a good read even if its roots are in advertising and it appears a little

dated now.

IS AProduct CategoryAn 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 lets look at the context of this element in the widerpositioning statement.


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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 prospects 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 isnt 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 cant 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 were 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 Its 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 its 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 youll gain greater insight. Ask yourself what category of product a prospect would turn to,

to solve their particular problem. In many cases its moot anyway as, if youre 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 Ive used throughout this document, were

looking at how Microsoft takes its ESB Guidance product to market.


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WHO...

Painneedordesire

THATPROVIDES...

Compellingreasontobuy

Microsoft describes its product category as follows:

IS A loosely-coupled messaging environmentFor 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 PROVIDESThe Main Benefitor Reason to buyThis is certainly one of, if not th e 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 defineabout their own offering. Once again, lets look at how this element fits into the context of the complete

positioning statement.


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 isto 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 THATPROVIDES element is oftenpaired with the W HO [has this specific pain or problem] element of thepositioning statement. So that the W HO element sets up the main painexperienced by the target customer and the THAT PROVIDES sectionoften outlines the solution or antidote to the pain.

Its 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.


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UNLIKE...

Primarycompetitororalternative

OURPRODUCT...

Primarydifferentiation/USP

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, Ive reverse-engineered the positioning statement for

Microsofts 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 architecturesThis example falls strictly into the vanilla category and certainly doesnt 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.

UNLIKEThe Primary Competitor orAlternativeThis particular element in the positioning statement is where the ideal customers alternative to our product is

defined. First lets see this element in the context of the complete positioning statement.


primary alternative or competitor]OUR PRODUCT [has this unique selling proposition].Whilst this sounds straightforward I typically hear

Its 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 competitors 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 clients perspective is captured in this element.

In my experience this element is nearly always paired with the OUR PRODUCT elementthat follows it in the positioning statement. The combination allows the UNLIKEelement to define the primary alternative or competitor and the following OUR PRODUCT element outlines the Unique Selling Proposition benefits thatdifferentiates our product versus the primary alternative.


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UNLIKE alternative approaches to managing riskOUR PRODUCT not only manages risk butalso 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 fromto 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 wronghere. It is critical to think from the prospects perspective and not from ones own organisations perspective.

Many marketing organisations typically think:

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 Ive used or seen for this element include:

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)

Situation "Whatsituation(needntbenegative)doestheidealcustomerfindthemselvesin?"

Competition "Whodowecompetewithhere?

Market Share Whohasthelargestmarketshare?

Similarity "Whohasaproductthatismostsimilartoours?

Analysts Who

do

the

analysts

think

we

compete

with?

Competitor Akeycompetitor

Product Akeycompetitiveproduct

Competitors Anumberofkeycompetitors(itsbettertohaveasingledefinedalternative)

Category Akeycategoryofcompetitor

Alternatve Analternativeapproachtosolvingtheproblem

Inaction i.e.doingnothing


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UNLIKE using spreadsheets to manage data. (an alternative approach) UNLIKE outsourcing your data management needs. (an alternative approach) UNLIKE managing information manually as youve always done. (inaction doing nothing)

Real world example

For those familiar with the SOA and ESB market, Ive used our REPAMA methodology to reverse-engineer thepositioning statement for Microsofts ESB Guidance product from their outbound marketing communications.

Microsoft apparently perceives the primary alternative to be:

UNLIKE traditional ESBsSo Microsoft is using the other vendors approach in the same market category strategy listed above. This

suggests that Microsoft believes that their prospects primary alternative lies with other ESBs and also that there

is something about Microsofts approach to the ESB category that sets it apart from traditional ESBs.

OUR PROUDCTThe Unique SellingPropositionIm 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, lets take a look at this element in the context of the complete positioning

statement.


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. Ive 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 Im 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

lets 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 wasnt. 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 weve 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:


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UNLIKE...

Primarycompetitororalternative

OURPRODUCT...

Primarydifferentiation/USP

1. Each advertisement must make a proposition to the consumer. Not just words, not just productpuffery, 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 customersto 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 its

no surprise that many of the USPs I see when reverse-engineering vendors 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 its important to

remember that the OUR PRODUCT positioning element is typically paired withthe UNLIKE section. The UNLIKE element sets up the main alternativeand the

OURPRODUCT

element describes the USP that the alternativedoesnt have.

As shown below:

UNLIKE [the primary alternative or competitor]OUR PRODUCT [has this unique sellingproposition]

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 its important to remember that were

not just trying to find a unique space, but a unique space that has compelling value to the consumer/customeras 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. Microsofts USP section is

shown below:

OUR PRODUCT provides a superset of ESB functionality, extending the ESB pattern to includemodelling and execution of business rules, workflow, and adapter integration.


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Here Microsoft selects a pretty strong USP. They claim that UNLIKE other ESBs they provide extendedfunctionality. 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 functional ity than other simple ESBs. I think this is a pretty well constructed USP despite

the fact that the rest of Microsofts 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 were looking to communicate a specific benefitthat 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 TogetherSo that completes the description of the positioning statement format that Lustratus uses to help our clients

define compelling market propositions. So well close out with a final look at the combined example positioning

statement for Microsofts ESB Guidance.

FOR Microsoft BizTalk DevelopersWHO are building solutions that leverage the SOA patternOUR Microsoft ESB GuidanceIS A loosely-coupled messaging environmentTHAT PROVIDESan infrastructure for enabling a service-oriented architectureUNLIKE traditional ESBsOUR PRODUCT provides a superset of ESB functionality, extending the ESB pattern to includemodelling and execution of business rules, workflow, and adapter integration

Further ReadingMany 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


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About Lustratus ResearchLustratus 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 analystsinclude some of the top thought leaders worldwide in infrastructure software.

Lustratus offers a unique structure of materials, consisting of three categoriesInsights, 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 REPAMALustratus REPAMA is the marketing consultancy and competitive marketing intelligence division of the analystfirm 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 2009Lustratus 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. Additionalreproduction of this publication in any form without prior written permission is forbidden. For information on

reproduction rights and allowed usage, email [email protected].

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

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