The startup world is brutal. You’ve poured your heart and soul into building a product that you believe will change the game. But here’s the kicker: so has everyone else. The harsh reality is that having a great product isn’t enough. You need to position your product in a way that cuts through the noise and resonates with your target audience.
What is positioning? I like to illustrate this with my take on an old joke: “While the optimist and pessimist argue whether a glass is half full or half empty, the marketer changes the glass.”
In this post, I’m going to share some hard-earned insights on how to navigate these turbulent waters. I’ll dive deep into the nitty-gritty of positioning, explore the pitfalls of trying to create a new category (spoiler alert: it’s harder than you think), and discuss practical strategies for positioning yourself as a better alternative to legacy products.
The Siren Song of Category Creation
Let’s start by addressing the elephant in the room: category creation. Category creation is a marketing strategy in which a company designs a new product category — along with name, problems, solutions, and audience — and promotes that category alongside the product itself. The goal is to convince buyers they need a certain kind of product, then win that growing market by virtue of having the only (or leading) product in it. It’s a tempting idea, one that’s been glorified by success stories like Uber with ride sharing, Gong with revenue intelligence, or HubSpot with inbound marketing.
But here’s the cold, hard truth: successfully creating a new category is incredibly hard and success is far from guaranteed. It requires not just a revolutionary product, but also deep pockets, years of consistent messaging, and often, a significant shift in how businesses operate.
I’ve seen countless startups exhaust their runway trying to educate the market about a problem they didn’t know they had. It’s a costly and time-consuming endeavor that often becomes an impediment to growth.
The Hidden Costs of Category Creation
When you’re creating a new category, you’re not just selling a product — you’re selling a whole new way of thinking. This means:
- Massive marketing spend to educate the market
- Longer sales cycles, as you convince prospects they need a solution they’ve never considered before
- Confusion and resistance from prospects who don’t understand the new category
- Increased churn when your visionary champion inevitably changes jobs and budgets are re-allocated or cut
When does Category Creation Make Sense?
Category creation isn’t for the faint of heart. It’s a high-risk, high-reward strategy that only makes sense in very specific circumstances.
You should consider category creation when you’ve got a truly revolutionary product that solves a problem in a way that’s fundamentally different from existing solutions. We’re talking game-changing stuff here, not just incremental improvements.
But here’s the kicker: you need deep pockets and a long runway. Category creation requires massive investment in market education and a willingness to play the long game. You’re not just selling a product; you’re selling a whole new way of thinking.
It’s also crucial that your solution aligns with emerging market trends and addresses a growing pain point that existing categories can’t adequately solve. Early adopters can’t find a product that meets their needs are cobbling together their own solutions. In other words, the market is ripe for disruption.
If you tick all these boxes and have the resources to sustain a multi-year effort, category creation could be your ticket to market dominance. But if not, you’re probably better off positioning within an existing category.
Position Your Product To Solve An Existing Need 10X Better
So, if creating a new category isn’t your best bet, what’s the alternative? Simple. Position your product as a much better way to meet an existing need than current solutions. Examples of new entrants that went on to dominate existing categories include Zoom reinventing video conferencing, Slack reinventing chat, and Salesforce reinventing CRM in the cloud.
This approach has several advantages:
- Buyers (and investors) already understand the problem you’re solving
- There’s an existing budget allocated for solutions in this space
- You can focus your limited resources on explaining how you’re better than legacy solutions
Identify the Gap
The key is to identify the gap between what existing solutions offer and what customers actually need. This involves:
- Deep customer research to understand pain points with current solutions
- Analysis of market trends and emerging technologies
- Identifying underserved segments within the existing market to find your best beachhead
At Pointillist, for example, we realized that all the existing customer journey management tools were focused on designing and automating customer interactions. But, there was a lack of solutions that enabled CX teams to uncover customer behavior and analyze its impact on the KPIs their business focused on. This gap became our focus.
Craft Your Positioning Strategy
Once you’ve identified the gap you’re filling, it’s time to craft your positioning strategy. Here’s a step-by-step approach:
1. Define Your Target Audience
Be specific. “B2B companies” is too broad. “B2B SaaS startups struggling to produce consistent growth” is much better. The more precisely you can define your audience, the more effectively you can speak to their specific needs.
2. Articulate the Problem
Clearly state the problem you’re solving. Make sure it’s a problem your target audience recognizes and cares about. For example: “B2B SaaS startups have lower win rates and higher churn when their sales and marketing teams are misaligned, resulting in disjointed customer experiences.”
3. Explain Your Solution
Describe how your product solves this problem better than existing solutions. Focus on outcomes, not features. For instance: “Marketbuildr helps startups align go-to-market teams around the customer journey, resulting in increased pipeline, more closed deals and higher customer satisfaction.”
4. Highlight Your Unique Approach
What makes your solution different? Is it your technology? Your methodology? Your team’s expertise? Make sure this differentiator is something that truly matters to your target audience. At MarketBuildr, for example, we’re not just implementing marketing automation tools or sales enablement platforms. We’re changing the way startups go to market. Most startups are still operating like it’s 1999 — marketing tosses leads to SDRs, who toss meetings to sales. It’s a disjointed mess that frustrates buyers and kills deals. We help startups transform their go-to-market teams using a cohesive, cross-functional approach we call the ‘Triple Threat.’
5. Provide Proof
Back up your claims with data, case studies, and testimonials. Show real results that your solution has achieved for other companies similar to your target audience. At Pointillist, we put this approach into action to close heavy hitters like Comcast and Citi, and rocketed from zero to $10M ARR.
Communicate Your Positioning Consistently
Having a great positioning strategy is only half the battle. The other half is effectively communicating this position to your target audience. Here are some key strategies:
1. Develop a Clear and Compelling Message
Your messaging should clearly articulate your position in a way that resonates with your target audience. It should answer these questions:
- What do you do?
- Who do you do it for?
- What unique benefit do you provide?
- How do you do it differently than others?
At Marketbuildr, our core message is: “We help B2B SaaS companies align their sales and marketing teams around the customer journey, resulting in increased pipeline, more closed deals and more predictable revenue growth.”
2. Create Content That Showcases Your Expertise
Develop thought leadership content that demonstrates your deep understanding of your target audience’s challenges and your unique approach to solving them. This could include:
- Blog posts
- eBooks
- Webinars
- Email Newsletter
- Speaking engagements
The key is to provide value and build trust, not just promote your product.
3. Leverage Customer Stories
Nothing speaks louder than the success of your customers. Develop detailed case studies that show how your solution has helped companies similar to your target audience overcome their challenges and achieve their goals.
4. Engage in Your Target Market’s Ecosystem
Participate in industry events, contribute to relevant publications, and engage in online communities where your target audience spends time. The goal is to become a recognized and trusted voice in your space.
Overcoming Resistance to Change
When positioning yourself against legacy products, you’ll often face the “if it ain’t broke, don’t fix it” mentality. Here are some strategies to overcome this challenge:
1. Focus on Evolving Needs
Highlight how customer needs have evolved and how legacy products are falling short. For example, we emphasize how the rise of account-based marketing and the increasing complexity of B2B buying journeys have made traditional, siloed marketing and sales approaches obsolete.
2. Emphasize Future-Proofing
Position your solution as a way to future-proof their business. Show how your approach aligns with emerging trends and technologies.
3. Demonstrate ROI
Clearly articulate the return on investment of switching to your solution. This could include time saved, increased revenue, improved customer satisfaction, or other relevant metrics.
4. Address Switching Costs
Recognize that switching from a legacy product involves costs and risks. Be upfront about these and show how you mitigate these costs and that the benefits of your solution outweigh them in the long run.
Continuous Refinement
Remember, positioning isn’t a one-and-done exercise. It’s an ongoing process that requires constant refinement based on market feedback, competitive moves, and evolving customer needs.
At Marketbuildr, we regularly review and refine each client’s positioning by:
- Conducting customer interviews to understand how their needs are evolving
- Analyzing win/loss data to identify trends in why we win or lose deals
- Monitoring competitor messaging and positioning
- Testing different messaging with various customer segments
This continuous refinement ensures our client’s stay relevant and maintain our competitive edge in rapidly evolving markets.
The Ball Is In Your Court
Positioning your product for success in a crowded market is no easy feat. It requires a deep understanding of your target audience, a clear articulation of the problem you’re solving, and a compelling explanation of why your solution is the best choice.
While the allure of category creation is strong, for most startups, most find success by positioning their product as a better way to meet an existing need. This approach allows you to leverage existing market understanding while still differentiating yourself from legacy solutions.
Remember, great positioning is not about claiming you can do everything for everyone. It’s about clearly articulating who you serve, what specific problem you solve, and why your approach is uniquely effective.
At Marketbuildr, we’ve found success by focusing relentlessly on aligning sales and marketing teams around the customer journey. We didn’t create a new category — instead, we positioned ourselves as a better way to achieve sales and marketing alignment, a need that B2B companies have long recognized but struggled to address effectively.
As you work on your own positioning, stay focused on your customers’ needs, be clear about the value you provide, and don’t be afraid to evolve your positioning as the market changes. With persistence and continuous refinement, you can cut through the noise and establish a strong position in even the most crowded markets.
Now, I’d love to hear from you. What challenges are you facing in positioning your startup? How are you differentiating yourself from legacy solutions? Share your thoughts in the comments below, or reach out directly if you’d like to discuss your specific situation.
Remember, in the world of startups, the race doesn’t always go to the swift, but to those who can articulate their value most effectively. So get out there, refine your positioning, and show the world why your solution is the one they’ve been waiting for!
Did you enjoy this post? Please let me know in the comments! I’ll be reading them all.
A version of this article originally appeared on marketbuildr.com
Photo credits: Watch the Gap on Freepik, Man with Megaphone by asier_relampagoestudio on Freepik, basketball image by master1305 on Freepik