Tag Archives: positioning

Positioning as more than just marketing

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I’m reading Peter Drucker’s seminal book on management and came across the interesting story of Sears expansion into new markets. It was meant to be a cautionary tale to learn from failure and reexamine your theory of the business. However I wonder if it can also be a cautionary tale of positioning.

Seventy years ago, in the midst of the Depression, Sears decided that automobile insurance had become an “accessory” rather than a financial product and that selling it would therefore fir its mission of being the informed buyer for the American family. Everyone thought Sears was crazy. But automobile insurance became Sears’s most profitable business almost instantly. Twenty years later, in the 1950s, Sears decided that diamond rings had become a necessity rather than a luxury, and the company became the world’s largest – and probably most profitable – diamond retailer. It was only logical for Sears to decide in 1981 that investment products had become consumer goods for the American family. It bought Dean Witter and moved its offices into Sears’s stores. The move was a total disaster. The U. S. public clearly did not consider its financial needs to be “consumer products.”

Was it that the consumers didn’t see them as consumer products yet or was it more due to the fact that they didn’t see Sears as that type of company? Al Ries and Jack Trout explained in their book Positioning, the proliferation of marketing messages has forever changed how we market to consumers. It’s moved the battle field into the mind of the consumer and they only have one slot, or if you’re lucky a few slots, for any product category. If you already see BMW as the leader in driving performance it’s nearly impossible for another car to knock them off and you’re better off trying to create another slot to own – Volvo and safety.

Sears expanded into auto insurance and diamonds when there were much less messages plastered everywhere. Consumers hadn’t yet built up processes to deal with the influx of messages. By the time Sears bought Dean Witter the consumer had already put Sears into a slot, a slot that didn’t include consumer products. Of course that in itself should prompt Sears to reexamine their theory of the business as Drucker advices.

Best books for lean product managers

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Being an avid reader of non-fiction I find that I tend to go through phases. Right now I’m racing through books that have anything to do with Disney Imagineering. Prior to that it was lean product development. Having just finished Four Steps to the Epiphany I thought I’d compile a list of what I found to be the best lean product management books I’ve read over the last year.

Four Steps to the Epiphany

This book is all about Steven Blank‘s concept of Customer Development. If you’re not familiar with Customer Development you should be. It’s very different than the traditional product development model. Where as most start-up founders start with the conviction that they know success looks like and just need VC money to build it, customer development starts with a hypothesis. It’s only once a hypothesis has been validated that you really start building.

The book covers much more than just product management but gives you a good idea of the role in a Customer Development start-up.

The Four Steps to the Epiphany

Inspired – How to Crate Products Customers Love

The book by Marty Cagan is much more focused on product management and interestingly enough, describes a process that’s very similar to Steve Blank’s Customer Development. It’s all about quick prototyping and listening to users – seems simple enough but goes much beyond that and gives you detailed action items. Like Four Steps of Epiphany, much of the suggestions in are counter to what you might have come to expect from start-ups today.

Inspired: How To Create Products Customers Love

The Back of the Napkin

Lean development means getting your idea across in simple ways. I can’t tell you how much trouble misunderstandings have caused me in my years of product development. As they say, a picture is worth a thousand words but this book by Dan Roam goes beyond just making pretty pictures. It explains how to go about creating the most informative picture even if you don’t know how to draw.

The Back of the Napkin: Solving Problems and Selling Ideas with Pictures

Positioning: The Battle for Your Mind

This by no means is a new book, but having re-read it recently I can’t get away from how timely it still is. Everyone talks about viralitiy, social media, etc. but the fundamentals of marketing are still about positioning your product in the minds of users. As a product manager you need to understand this if not just for the fact that your products success is not entirely up to which features you build or do not build.

Positioning: The Battle for Your Mind, 20th Anniversary Edition

Made to Stick

http://www.goodreads.com/book/show/69242.Made_to_Stick_Why_Some_Ideas_Survive_and_Others_Die

If it’s all about positioning then Made to Stick is a timely guide to do just that. It’s also more than just marketing, it’s message of simplicity goes much farther.

Consider it a great how to guide to finding simplicity. Products and processes can get very complicated, this book will help you take a step back and see what’s important.

Made to Stick: Why Some Ideas Survive and Others Die

Here Comes Everybody

Threw this in because I found it to be a book that makes you think about how the landscape is changing. It’s all about mass amateurization, something Clay Shirky introduced us to when he described how the world of publishing is changing.

Product managers should be familiar with the concepts in this book as they did social media a few years ago. Mass amateurization changes everything.

Here Comes Everybody: The Power of Organizing Without Organizations

Honorable mention

If Eric Ries would ever write a book about his Lean Startup I’d have that up here too. I’ve seen him speak twice and am always interested in hearing more. His Lean Startup is almost a nuts and bolts approach to Customer Development and more. Luckily he’s running a workshop next month that I’m attending.

Viral loops great, but not as great as positioning

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Update: Just noticed that Eric Ries posted about the show himself – check it out

Living in San Francisco it was easy to stop by the Facebook Developer Garage last night, put on by Kontagent. It was a great show and much more crowded than I expected. Of course they had a great lineup of speakers. I found Eric Ries presentation, with its emphasis on positioning rather interesting. Much of the material can also be found in an early post on his blog Lessons Learned.

He started his presentation by going over the levers of engagement.

  1. Synthetic notifications – sent directly from the company
  2. Organic notifications – sent from an action one of your friends did (automatically notify a person’s friends whenever they upload pictures)
  3. Positioning – “the battle for your mind” as Eric puts it

Then he covered viral metrics and the basics of building viral loops. Viral loops have been all the rage the last few years, with articles like “The 10 steps to creating a viral loop.” But as Eric warns, some of this might be coming at the expense of positioning. With everyone following the 10 steps or whatever, all they’ve done is ensure that their product is the same as every other – the exact opposite of positioning. Some might say who cares, we can track virality and we’re growing by leaps and bounds. Granted it’s a little tougher to track peoples minds but if you’ve lost that battle, you’ve lost the war.

In his blog post Eric suggests that you focus more on your positioning as it is the most powerful of the levers (synthetic being the least powerful) and then use the viral loop to drive it home.

To win the positioning battle, you could try and make your product better than the competition, or find a different positioning that allows you to be the best at something else. Let’s assume for the sake of argument that your competitors offerings are “good enough” and that you cant’ figure out how to beat them at their own game. So you decide to try to reposition around a different value proposition, one that more closely matches what your product is best at. You could try and drive home that positioning with an expensive PR campaign, superbowl ads, and whatnot. But you don’t have to – you have a perfectly good viral loop that is slowly but surely exposing the entire world to your positioning messages.

Silicon Valley is about technology first, everything else second. Ask someone about their new start-up and they’ll most likely tell you about its technology. After we realize that great technology itself isn’t going to guarantee success we gravitate toward the latest marketing trends, but we shouldn’t forget the tried and true realities of marketing of which positioning is one. How did Avis compete with the biggest competitor in rental cars, purely with positioning – “We Try Harder”.