Product Positioning Strategy: 12 Steps to Positioning Any Product

This article is an excerpt from the Shortform book guide to "Obviously Awesome" by April Dunford. Shortform has the world's best summaries and analyses of books you should be reading.

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What’s the best way to position a product in the market? What steps should you take, and in what order?

In Obviously Awesome, April Dunford proposes a 12-step process that lets you position any product well. Her process takes you all the way from creating a cross-departmental positioning group to sharing your final positioning across the company.

Let’s take a look at each step in Dunford’s product positioning strategy.

Dunford’s 12-Step Product Positioning Strategy

In her book, Dunford presents only a 10-step product positioning strategy. However, she includes a chapter after the tenth step, in which she describes how to implement your positioning and then track its success over time. We’ve framed the final book chapter as two additional steps because they seem as important to the process as all previous steps.

Step 1: Identify Your Most Eager Customer and What They Love About the Product

Dunford writes that the first step of this process is to reflect on what aspects of your product make your customers happiest and what aspects of your top customers make them appreciate your product so much. This clues you in on how to position your product for the customers who will most appreciate it. 

(Shortform note: Dunford operates under the assumption that you already have a product for sale and customers who love it. This can seem like putting the cart before the horse: If you haven’t yet positioned your product correctly (or if you don’t even have a sellable product), you might not have raving fans. One way to navigate this step is to first position your product however seems right to you now and then gather data both on what customers like and dislike about it. Use that data to refine your positioning until you can identify a group of top customers and think about what they love about your product, as Dunford recommends.)

Dunford adds that, when positioning for the first time, focus only on top customers because this will give you a clearer picture of why people buy from you than if you looked at all customers (who buy for too many different reasons to be helpful to you). 

(Shortform note: Dunford doesn’t say how to identify your top customers. To do this, you need to understand all your customers well first and then decide which of them you can sell to most easily. Get to know your customers by examining their habits, aspirations, fears, and buying decisions. Then, decide which customers will be the easiest to target.)

Step 2: Select a Cross-Company Group to Position Your Product

Next, assemble a group of employees from across the company who will define your current and new positioning, advises Dunford. A positioning process works best when it’s a team effort because you learn how different departments feel your product should be positioned. Then, you can incorporate their input and get everyone on the same page moving forward. 

(Shortform note: While soliciting the input of many departments is helpful in identifying your positioning, it’s important to structure such a cross-departmental meeting well to maximize effectiveness and keep the group on track. To do this, get the ideas of people attending the meeting in advance of the meeting, so you know what their position will be and can comment productively on it. And always prepare an agenda and share it with attendees.)

The main business strategizer should lead the group’s discussion, argues Dunford. This is because the top person must be behind this positioning effort for others to adopt it. In a startup, this person is the CEO or the founder. In a large company, this is the division or business unit leader. Dunford also feels it’s best to bring in an outside facilitator to lead team discussions to ensure everyone’s heard and to challenge beliefs and ideas everyone in the company takes for granted about the product. 

(Shortform note: As a female leader and facilitator in the business world, Dunford likely had to overcome many of the obstacles women face in the workplace. If you’re a female leader who must rally a team behind a new product position, or if you’re an outside facilitator who needs to earn the respect of a group of strangers, consider Sheryl Sandberg’s advice in Lean In to overcome impostor syndrome: Remind yourself of your past successes to counter feelings of inadequacy in a leadership role.)

Step 3: Develop an Open Mindset About the Best Positioning of the Product

Once you have a group of people who will position your product, they must consciously set aside old conceptions of the product to have the openness to devise the best new positioning, contends Dunford. If the group is mired in old ways of thinking about the product, they’ll never be able to optimally position it. For instance, if the group is convinced your high-powered vacuum cleaner should only be used for garage floors, they might not even consider that it could also be used for indoor spaces and thus positioned as such. 

To do this, first ensure members of the positioning team have a common understanding of what positioning is (if you employ an outside facilitator, they can establish clarity on this). Then, encourage the team to release their current ideas about the product’s positioning and be open to new positioning. 

(Shortform note: Dunford doesn’t explain how to get people to have an open mind about positioning. You can encourage your team to think openly about your product by strengthening what psychologists call accommodation: the process of changing your existing conceptions and belief systems about the world (not working new ideas into an existing belief system—that’s called assimilation). One way to accommodate is to become aware of confirmation bias (the tendency to only pay attention to information that supports your existing beliefs) and actively counter it. So when your team pushes against a new positioning idea, ask them to evaluate if maybe this is because it contradicts their existing beliefs about the product.)

Step 4: Identify the Alternatives to Using Your Product

Now that you have an open-minded team, figure out together what your product’s real competition is—in other words, what alternative solutions your ideal customers would use if they didn’t have your product, writes Dunford. It’s important to consider what the customer sees as alternative solutions, rather than what you see as alternative solutions based on the research of your competition because the customer’s alternative options are the only ones that matter here. 

To identify your product’s real competition, ask ideal customers what problem they want to use your product to solve, recommends Dunford. Now ask what other solutions they compare your product to: What would your ideal customers do if they didn’t use your product? Rank your answers to this from least common to most common, and focus more on the common alternatives.

Step 5: List Your Product’s Superior Features

Now that you know what alternative solutions your customers compare you to, identify what features make your product different and better than those alternatives, advises Dunford. Do this by listing all concrete unique features of your product. Approach your product from a few different perspectives to ensure you’re pinpointing all possible assets. You might consider asking ideal customers why they chose you and what they feel sets you apart from others.

When listing your product’s assets, stick to concrete, verifiable features rather than vague, unverifiable ones, like “user-friendly” or “increases productivity,” recommends Dunford. However, if an independent reviewer writes that your product does these vague things—that your product is more user-friendly than alternatives, for instance—that counts as a concrete and verifiable feature.

Step 6: Determine Your Features’ Value to the Customer

At this stage, you know what your product’s unique features are. Now, figure out how each feature adds value to your customer’s life, counsels Dunford. It’s easiest to break this step into two sub-steps: First, determine each feature’s benefit—what the feature will do practically for the customer. Next, determine what the value of the benefit is, advises Dunford: how the feature helps the customer solve their specific problem.

Dunford adds that you need to translate your product’s feature to its benefit and value for the customer because it’s rarely clear to the customer how these things are connected.

Once you’ve determined the value of each feature, group these values together based on their relevance to the customer, states Dunford. Do this by thinking about what values the customer would associate with each other. Narrow this down to one to four value groups.

Step 7: Pinpoint Customer Segments Most Likely to Buy Your Product

Once you have a good understanding of the value that your product delivers versus other alternatives, determine which customer segments care most about that value, advises Dunford. You’ll want to target these segments simply because they’ll be the easiest to sell to. To determine which customer segments to target, follow these steps:

1. Think about what makes some groups more excited about your product than others.

2. Consider how to identify these groups. You might identify them based on the brands they buy, the media they consume, or the jobs they hold.

3. Make this group as specific and narrow as possible at this stage and then expand later if necessary. Remember that your positioning will evolve over time, so you can change your target group if needed later.

Step 8: Sell Your Product in the Right Market, and Dominate It

Now that you understand your competition, your superior features, and which customer segments to target, sell your product in a market that provides context on how to use it and that gives you the opportunity to dominate that market.

You can try to dominate three types of markets, claims Dunford:

1. An existing market: Customers already know this market well and understand what defines a good product within it.

2. A subsegment of an existing market: Alternatively, if you’re a smaller company, pick a subsegment—an industry, region, customer group, or another factor—of an existing market you can dominate. Winning over a subsegment is easier than winning an entire existing market, and you’ll likely grow more quickly within that subsegment because happy customers will spread the word about your business within their small subsegment community.

3. A new market: Creating your own market is extremely difficult but also has the greatest potential for you to dominate, claims Dunford. This style is hard to pursue because you can’t use existing market references to help customers understand what your product is: You need to educate them from the ground up about your product.

Step 9: Optionally Connect Your Product to a Current Trend

Now that you know what market to target, you might take advantage of a current trend to show that your product is relevant and useful to consumers now, proposes Dunford. While this step isn’t mandatory—and there are conditions under which it’s a bad idea to ride a trend—if you can clearly show customers how what you already do aligns with a current trend in your existing market, you can benefit from the trend.

Step 10: Share the Positioning Across the Company

Once you’ve positioned your product, communicate that position across the company through a positioning document so all departments can apply the positioning to what they do, recommends Dunford. 

In the document, include the name and description of the product, its market or market segment, the alternatives to using your product, the product’s unique, superior features, the value it adds to the customer’s life, and the characteristics of the ideal customer.  

(Shortform note: Establishing buy-in into your positioning will likely only happen if your employees already are aligned with your company culture. This is because a strong culture gives employees a company identity to rally behind, which makes it easier for them to then rally behind the company’s positioning. Further, a strong culture encourages employees to stay at the company because they feel a sense of belonging, and this, too, helps firm up positioning because new employees don’t constantly have to be educated on it.)

Step 11: Implement Your Positioning

Once you’ve completed the above steps, implement your positioning, says Dunford. There are two parts to this: creating a narrative about your product (this is the pitch with which your salespeople will approach prospects) and building your messaging (contained in your marketing to customers).

Step 12: Track Your Positioning, and Adjust It if Necessary

According to Dunford, the final piece of the positioning puzzle is to track the success of your positioning over time and make adjustments if needed. Assess your positioning every six months to learn if the market has changed and if you need to thus reposition your product.

Product Positioning Strategy: 12 Steps to Positioning Any Product

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Like what you just read? Read the rest of the world's best book summary and analysis of April Dunford's "Obviously Awesome" at Shortform.

Here's what you'll find in our full Obviously Awesome summary:

  • What "positioning" is and why it's so important for marketing
  • Three common (and avoidable) mistakes marketers make
  • A 12-step process that lets you position any product well

Elizabeth Whitworth

Elizabeth has a lifelong love of books. She devours nonfiction, especially in the areas of history, theology, and philosophy. A switch to audiobooks has kindled her enjoyment of well-narrated fiction, particularly Victorian and early 20th-century works. She appreciates idea-driven books—and a classic murder mystery now and then. Elizabeth has a blog and is writing a book about the beginning and the end of suffering.

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