What is positioning?
This week, Justin Bohlmann, Thriday's Head of Growth takes over the blog to serve up some incredible insights on positioning; what it is, how you can use simple principles to tackle it for your business, and how we are approaching it at Thriday.
What is positioning?
First, let me share a story with you about where I first really thought about positioning from a ‘first principles’ perspective.
Back in 2018 I was fortunate enough to take part in Seth Godin's altMBA. For those that haven’t heard of the altMBA, it’s a 31-day online leadership workshop that celebrates our shared humanity and provides students with the skills they need to be impactful leaders and make meaningful change.
One of the prompts we worked through was titled “What is it for?” We had to analyse a number of products or services that we thought were good at accomplishing what they’re for. To do this we had to dig into the worldview of the typical user and be super clear on the who it’s for and the what it’s for.
Here’s a great line from that prompt:
“It’s likely you’ll discover a magical utility in the objects and services that do what they’re intended to do.”
The products and services you experience that do exactly what you expect them to do give you a sense of satisfaction, the complete opposite of the sense of frustration felt when the experience doesn’t live up to the hype or even the poor explanation. It’s this sense of satisfaction that your clients and customers should feel when they use your products or services!
We’ve built Thriday to save small businesses time, if they don’t save time then they’re not going to be satisfied, they’re going to feel the same frustration they’re feeling with the products they’re already using.
It became clear to me that good positioning isn’t about innovation or being clever, it’s about telling people what it does in simple terms that they understand and being clear about exactly who it’s for.
There’s another helpful element to great positioning that I’ll share in a moment but first let’s talk about the process behind good positioning.
If positioning should be simple and clear then why is there a ‘process’?
Hello, April Dunford!
If you’re about to embark on a positioning project or you’re even the slightest bit interested in good positioning then go and read her book Obviously Awesome!
April’s definition of positioning is this: “Positioning defines how your product is a leader at delivering something that a well-defined set of customers cares a lot about.”
April outlines, in super clear easy-to-follow steps, the process you can take to nail your positioning.
1. Understand the customers who love your product
At the time of writing this we’re a pre-launch start-up so we don’t have the luxury of a whole bunch of existing customer data.
To deeply understand the answer to this I use another resource and process I learnt a while back when I attended a workshop run by Ryan Levesque in Austin, Texas.
Ryan’s method for better understanding the market you’re after is called the ‘Ask Method’ and the aptly titled book, which I also recommend, is “Ask”.
Now, when you go and look that up you’ll find info on surveys and quizzes and lead generation, that’s all good and the method works great for achieving those goals but where the gold really lies in Ryan’s approach is in what he calls the deep dive survey.
This deep dive survey is designed to uncover the real problems people have (which ideally your product is trying to solve) and they’re telling you in their words what those problems are and how they’re making them feel.
There’s also a formula for pinpointing and understanding who your “hyper-responsive” people are. The absolute gold that comes from these surveys is priceless!
2. Form a positioning team
This one is self-explanatory but when you’re agreeing on important inputs and outputs make sure the right people are in the room or on the Zoom.
3. Align Your Positioning Vocabulary
This one’s important, don’t hold onto what you may have done in the past.
Start from scratch.
4. List your true competitive alternatives
They might not be as clever or complicated as what you think!
In our case, we’re not just competing with banks and big tech companies, we’re also competing with people using excel. (I don’t know why you’d still want to manage your finances with just Excel but, hey, whatever floats your boat!)
5. Isolate Your Unique Attributes or Features
This is key!
If there’s nothing unique about what you do then it’s probably going to be a hard sell.
But don’t be despondent either, what you do may not be unique, it may be how you do it. Each individual feature you have may not be unique on their own but combining them may be!
6. Map the attributes to the themes
Take your laundry list and simplify it into groups of features, products or services that relate to a certain outcome.
What benefits do the features or products provide and what value do those benefits give to the end user.
Read April’s book, please! It’s an amazing resource for this.
7. Determine who cares (a lot!)
This feeds into No. 1 and is why I mentioned the hyper-responsive users.
If you already have a product or a service then segment the users who are giving you high NPS, are most engaged, pay you the most money, refer you to more people more often.
8. Find a market frame of reference that puts your strengths at the centre and determine how you position it
This is important and comes back to what I was saying about not being too clever or trying to innovate with your positioning.
If no one understands what you do and who it’s for then it’s going to be very hard to win!
For us, we’re creating a new category, no one has ever combined financial management tools natively with an actual bank account so we could have been clever and called it something new.
Instead, we followed the process.
When we tested our positioning, with real people, this is what worked:
“Thriday is a banking and accounting platform for small businesses.
We save small businesses time by automating their financial admin.
It’s like having a bookkeeper, accountant and a bank account all in one.”
Let me pick that apart a bit:
Thriday is a banking and accounting platform for small businesses
We’re not a bank, we partner with a bank to give people a Thriday white-label bank account. We can’t call ourselves a bank and mentioning the term ‘white-label’ in your elevator pitch is a great way to send your conversion rate through the floor.
You see what I mean by simple, not easy?
Also, we do more than banking, we have a whole suite of features that massive businesses dedicate to selling as stand-alone products and services, so how do we roll them all up in a one-liner that people understand?
This is where the ‘market frame of reference’ comes in.
People instantly get what banking is, and they instantly get what accounting entails and they also understand, and prefer, the noun ‘platform’ (compared to app which we also tested).
When you combine these terms it’s very clear exactly what Thriday is for, then tack on “for small businesses” Boom, simple, effective positioning that users understand.
In addition to the altMBA prompt I really like what April’s definition adds to the who and the what: “Positioning defines how your product is a leader at delivering something that a well-defined set of customers cares a lot about.”
What we know is that our customers, small businesses, care a lot about their time. So, in our positioning statement, we tell them:
“We save small businesses time by automating their financial admin.”
We then clarify what makes us the leader to those people with:
"It’s like having a bookkeeper, accountant and a bank account all in one."
Those services and features all exist as stand alone products but no one else has combined them all into one product to save small businesses time!
The beautiful thing about this line is that it came verbatim, from a real person who has never heard of Thriday.
A question we asked in the deep dive survey was if you had one wish to make managing your finances easier, what would it be? This was part of their answer.
9. Layer on a trend
I decided to steer away from this one because I thought it might be getting a little too clever.
If we were launching a fitness company then a trend probably wouldn’t be too hard to come by and may make sense but for us, not so much.
10. Capture Your Positioning so It Can Be Shared
Probably the most important part of all, make sure everyone is reading from the same song sheet!
I have a document I’m continually building out that is basically our internal manifesto.
Everyone can access it and pull out anecdotes, approved copy, interviews, quotes, ad copy you name it!
A new employee can come in and understand Thriday in minutes from a single approved source of truth.
Again, April has a great framework for this so please, read the book!
What is positioning?
The altMBA version: Positioning is telling people what it’s for, who it’s for and then living up to it.
According to April Dunford: “Positioning defines how your product is a leader at delivering something that a well-defined set of customers cares a lot about.”
I have a saying: “Do hard things to make life easy.”
Do the hard work.
Talk to your customers.
Run the surveys.
Do the analysis.
Do the user testing.
Read everything you can get your hands on.