An Effective Positioning ≠ Outside of the Box Thinking

I read something interesting at the gym last week in Seth Godin’s latest book, Linchpin.

Artists don’t think outside the box, because outside the box there’s a vacuum.

Finding an effective positioning for your business won’t come from thinking outside the box. It will come from re-imagining the box you are in, the market where you compete.

If you have ever worked as a consultant or tried to sell ideas you will know how hard it is to ‘splain multi-dimensional concepts to most business people. Bless the MBA schools, they sure know how to turn out highly qualified linear thinkers; X axis by Y axis, they get, but what about the Z axis?

Your opportunity is to consider your market, your competitive landscape, your customers’ needs in three dimensions to find an effective positioning.

I will give you an example.

I’ve been helping Red8 Studios re-imagine their business. Red8 is a successful, 7-year-old interactive production company. They have been going to market with the following positioning: low cost for quality code. Nothing wrong with this, per se, except that it describes most of their competition. And most of their customers, small and mid sized ad agencies and design firms, aren’t that price sensitive, because they pass the cost through to their clients.

In most categories there are three characteristic areas, three benefit zones, that define the market where companies and consumers interact. They are usually focused around the product, price/value and service.

Step one to finding an effective positioning, is identifying the three that best define your category.

Think about airlines: product = routes and schedules, Price/value = well, price and value, and service = well, usually not much.

Most airlines compete on one dimension, product, or routes and schedules. Some have tried to compete solely on price. ATA comes to mind. Some have tried to position themselves using service. Come fly the friendly skis. This only works if your are, in fact, friendly. But the few that are and have been successful, like Southwest Airlines and Virgin, use more than one dimension to position themselves in the market.

Back to Red8 for a moment.

The Red8 team produces high quality code. They can compete with anyone in this area. But the reality is, code is commodity. Lots of resources produce high quality code. Red8 is inexpensive. Well lots of resources, especially off shore resources like Red8, are inexpensive. Service, what do they offer beyond product and price? Now that’s an interesting question.

Lets look at the competition.

Off shore resources can give you code at a low price but they may or may not be able to complete the job when and how the customer wants it completed. So price.

Freelancers and Digital agencies produce great code, but it’s usually at a high cost and it often comes with a lot of ‘tude. So product.

Traditional ad agencies wouldn’t know good code if it held a flashing neon sign. They also cost a lot. But they have the service thing down to a fine art. So service.

So where’s the opportunity?

Great code at a reasonable price from a team that’s smart about technology and super easy to work with.

Hip Shot

Re-imagine your positioning considering the three dimensions that define your market. Look for where they overlap. If you can define your business where all three overlap, then you are on to something because chances are your competition is only thinking about one or, perhaps, two of them. Bless the MBA schools.

Tagged as: Business Strategy, Marketing Strategy, SOHO Marketing