In Defense of Positioning

My passion is positioning companies for success, specifically technology companies, and I’m writing a book about the process I developed to do this. I like to think of it as Trout and Ries 2.0. It’s a how-to manual for articulating what your company actually does and why it matters. It’s called Mothers, Mechanics and Missionaries: The Only Way to Position Your Company for Competitive Advantage. It is based on a framework that identifies corporate DNA and then helps articulate a unique position in the marketplace that your company can own. Identifying the ideal market position and articulating it in a compelling way is the end goal, but the process to get there takes into account the “DNA” of your company and illuminates positioning paths that align with it. Positioning without this alignment results in inauthentic descriptions of your company and deteriorates in a matter of months. It is the alignment of your corporate DNA and your leadership team that makes for a sticky positioning statement that attracts customers and enables you to explain how you fulfill their needs. We call this “Getting to Aha!”.

Several weeks ago I explained the framework to the CEO of a well-funded and most-likely-to-succeed startup. Let’s call him “Steve.” Steve was looking for a new way to talk about his company as he expands his product features and seeks to attain more customers. He was intrigued. So intrigued, in fact, that he went back the mount where he recounted my thesis to his VC seeking guidance for his own positioning problem. Mr. VC wasn’t buying it. He told him that as the CEO of a startup, he couldn’t afford to focus on one or another “DNA type.” He had to be able to walk and chew gum at the same time. In effect, what he told the CEO is, “You have to be all things to all people.” Not easy to do and in fact, the antithesis of positioning. Great positioning is about sacrifice. And more importantly, it is about the discipline of sacrifice. Great venture capital is about picking the passionate founder who can also lead, about timing product-market fit and about identifying resources (like positioning) that can help turn ideas into businesses.

Here’s what I told Steve.

I developed a “corporate DNA” framework for positioning about 15 years ago to help tech companies get to a credible and compelling description of their market position (positioning statement). Credible because it has to ring true and compelling because it has to be differentiated from competitors and exciting to customers. Many marketing types figure this out in the privacy of their own creative brains and come up with something that sounds very good at first pass—frankly, that’s what I used to do. However, I learned that this approach doesn’t work as well with technology companies. First, very little evidence for the new position is apparent and engineers like evidence. Second, leadership team members usually don’t align with the new position because they haven’t participated in its development. Consequently, the solutions that come from this exercise don’t last very long. So I decided to develop a process—or more accurately, reverse engineer my own process, to determine exactly how I was developing “positionings” for clients. That’s when the “Corporate DNA Framework” was born.

It is a framework to aid in the determination of the best possible description of a market position. It is a bit like “personal medicine” for marketing. We look at the DNA of a company and help determine a positioning statement that aligns with the corporate body because when it is aligned, it is easier to execute and has a better chance of success. This framework relies on an intimate understanding of the company, its product and its leadership (DNA) as well as the competitive environment. 

The construct is relatively simple and it focuses on the dominant DNA of the three types of companies identified in the thesis: a customer-oriented company (think Zappos), a product-oriented company (think Uber) or a concept-oriented company (think Salesforce). I call these Mothers, Mechanics and Missionaries. Each of these companies organizes itself a bit differently, focuses on different success metrics and hires different kinds of people. They each express themselves according to their DNA.

And it turns out that each type has available to it two positioning directions. Mothers can position themselves around customer segmentation (like Garmin) or customer experience (like Lyft). Mechanics can position themselves around features (like Microsoft) or value (like Huawei) and Missionaries can position themselves around the Next Big Thing (23andMe) or cult of personality (Hampton Creek).

It is important to note that recessive genes play a huge role here too. Just because Zappos is a customer-oriented company doesn’t mean it ignores the product. Just because Uber focuses on the product doesn’t mean it abdicates responsibility to customers. And so on. The framework simply enables companies to develop brands that are consistent with who they are and what they trying to do. None of this precludes the prime directive of walking and chewing gum at the same time. But it’s the companies that know what they’re made of, structure themselves accordingly and exploit the hell out of that while shoring up their recessive areas to meet market needs that typically win. 

By the time I developed this framework, I had already done hundreds of these positioning exercises and since then, hundreds more with a perceptible increase in clients Getting to Aha! at the end with the added benefit (perhaps even more important) of an aligned leadership team on direction. This is because a good positioning statement is a compelling description of the corporate strategy and this exercise forces alignment on strategy. Once the company’s role and relevance are stated simply, it is easily understood by management and becomes a filter for ongoing business decisions like acquisitions, partnerships, management and personnel.

As a marketing person, I believe understanding a company’s corporate DNA type is critical. It not only articulates a unique role and relevance in the market, it also aligns management teams and provides differentiated descriptors for analysts and press, not to mention new hires. This exercise also helps to inform whether a new category should be created. All in all, positioning is an exercise of strategy that when done correctly cements the foundation of a company and informs all marketing, sales and HR initiatives. It is an act of sacrifice that ensures a long and healthy life.

Get to Aha! with your positioning too.