Why a Positioning Statement Template Cannot Find Your Positioning

The exercise that produces a sentence nobody uses

You have seen the template. For a buyer who has some need, our product is a category that delivers some benefit. Unlike a named competitor, we do some thing differently.

Teams fill it in, agree on the wording, and put it in a document. The sentence is accurate. Nobody on the team ever says it out loud. Nothing about how the product sells changes.

That is not a failure of effort. It is what the tool does.

The assumption buried in the blanks

April Dunford, writing in Lenny's Newsletter, calls the positioning statement exercise pointless and possibly worse than that. Her objection is specific.

The template assumes there is one correct answer for each blank, and that you already know what it is.

Most products could be positioned in more than one category, against more than one set of alternatives, delivering different value to different kinds of buyer. The exercise gives you no way to work out which of those is the strongest. It records the answer you walked in with and dresses it in a sentence.

If the answer you walked in with were the right one, strangers would already be arriving.

What the template would have missed

Dunford's account of her first product marketing job makes the point better than the argument does.

The product was conceived as a desktop database, positioned against the obvious incumbent. After a serious marketing effort it had sold about two hundred copies. The company decided to shut it down, and she got the job of calling buyers to see how much they would mind.

She made a hundred calls. Ninety-four did not remember buying it. Six had rebuilt part of their business on it. Those six were not using it as a desktop database at all. They had installed it on laptops and mobile devices so field staff could work away from the office and sync when they got back.

Instead of killing the product, the company repositioned it as an embeddable database for mobile devices. It grew, the company was acquired, and the product outlived everyone involved.

No template would have produced that. The category was not in anyone's head to write down.

Start where the buyer starts

Dunford breaks positioning into five components. Competitive alternatives. Differentiated capabilities. The value those capabilities produce. The customers who care most about that value. And the market category.

The order is the part that does the work, and it is not optional. Each component only makes sense once the one before it is settled.

You start with competitive alternatives, meaning what a buyer would actually do if your product did not exist. Then you ask what you have that those alternatives do not, which gives you your differentiated capabilities. Then you ask what each of those is worth to a buyer, which gives you value. Then you ask which buyers care about that value enough to move, which gives you your best-fit customers. Only then do you pick the category, which is the context that makes your value obvious to those buyers.

Starting anywhere else produces positioning that sounds right in a meeting and does nothing in the market, because differentiation only exists relative to something.

Three ways it still goes wrong

Dunford names the traps, and all three are common in products that are already selling.

Treating any possible competitor as an alternative. The question is not who could compete with you. It is what a buyer would do instead. Often the answer is a spreadsheet, a manual process, or nothing at all. In enterprise software a large share of deals are lost to that, not to a vendor.

Listing competitors you have never met in a deal. Naming a company you have never lost to weakens your positioning, because you end up differentiating against a threat your buyers have not considered.

Assuming you have to invent a category. Inventing one means teaching the market a word before the word can do any work for you. Most companies that went public in recent years were positioned inside categories that already existed.

What to do with it

Take one hour and answer one question with your sales conversations in front of you, not from memory. If we did not exist, what would this buyer have done instead?

Write down what they actually would have done, including doing nothing. That list is the only honest starting point you have, and everything else in the process hangs off it.

Dunford's full walkthrough, including the example that took a company from under two million in revenue to close to eighty, is in her guest post on Lenny's Newsletter. It is worth the twenty minutes.