When should we evalute positioning?

This question — when do we need to evaluate positioning? is one that comes up often when talking about positioning. There’s not one simply answer, because there are a lot of factors that go into determining the best positioning for your startup / company. Here goes.

If you’ve never evaluated your positioning, do it now.

Even if you are not experiencing any signs of a positioning problem, if you have never taken the time to interogate your positioning and conciously position your company, you need to do so. This could be in a ‘retreat’ over beers with your co-founders or with a professional facilitator, but the point is that the biggest positioning mistake that startups make is to ignore positioning.

When you ignore positioning, you let the media, your clients, your competitors and the random marketing firm you hired to design your website determine your positioning. Why would you let them control such a critical part of your business strategy?

If you’re experiencing symptoms of a positioning problem, evaluate your positioning.

What are some symptoms of a positioning problem? Here are some problems that often indicate a positioning problem:

  • A very leaky funnel

  • High customer churn

  • Very long sales cycle

  • Customers / prospects who ask for a discount

  • Inability to get press

Here are some symptoms that pretty much always point to a positioning problem:

  • Inability to answer the question “what is your product” in 10 words or less (NOTE: everyone on your team, including the intern you hired last week, should be able to answer this question accurately in 10 words or less)

  • Getting compared to the wrong competitors in sales meetings.

  • Taking 15 minutes of a sales conversation to get the prospect to understand what your product does

Positioning is not the only thing that can cause high churn rates… let’s face it, maybe the product sucks. But if you’re experience any of the symptoms in the second category and/or two or more of the symptoms in the first category, start troubleshooting the problem by seeing if the product positioning needs to change.

If there’s a giant shift in the market

Whenever you have a massive market shift — like, for example, suddenly everyone is working from home — you need to take a good look at your positioning to see if it is still appropriate. Ideally you would do this before you start feeling pain. It could turn out that your previous positioning is totally fine, but a major market shift is always a reason to check in with your positioning. Examples of a major market shift could be:

  • AWS is now offering a SaaS product based on your open source project

  • You have a security product and there has just been a very public, very major security breach at… pretty much everywhere

  • Suddenly Kubernetes is not popular anymore

Major shifts in the market could be changes in behavior / needs (for example, the need for remote collaboration tools / sharing of informal knowledge during COVID), a new competitor or big name competitor entering the market you’ve decided to stake out for yourself or other changes in preferences in your target market.

If you’re acquired / acquire another company

After an acquisition there are major positioning decisions to make about how the acquired company’s product is going to fit into acquiring company’s product suite, or whether it’s going to be folded into an existing product and how it’s going to relate to all of the products in the acquiring company’s current offerings. Evaluating positioning should be a part of the standard due dilligence process after a company has been acquired.

Are you in any of the above situations and want help evaluating your positioning? Reach out.

Emily Omier