Why Data-Driven Positioning Wins
What is data-driven positioning?
Data-driven positioning is the process of using data from customer and prospect testing to drive optimal and targeted market differentiation. Over twenty years of positioning companies, we’ve proven that data, in addition to creative thinking, is the difference between winning and floundering in the market.
FOCUS Inc. positions ZOOM at the intersection of creativity and data
Dan Thomas, founder and CEO of FOCUS, Inc., has worked with more than 500 businesses as an organizational strategist and served on the faculties of the Harvard and Stanford Business Schools. He believes positioning firms cut across two axes, intuitive vs. data-driven and cookbook vs. creative. Dan places ZOOM in the upper right quadrant with the ideal mix of creativity and data-driven.
The advantages of data-driven positioning
The advantages of data-driven positioning build upon each other, so clients not only believe in the results, they take it to the bank.
5 common business scenarios and their data mix
Clients ask us all the time if we’ve ever worked with a company in a situation like theirs. What about a scenario where we sell to three very different audiences? Or, a new venture that can’t articulate their story? Or, you name it. The answer is: YES! You’re not alone. Here are the typical scenarios we’ve seen, in which companies can win with data-driven positioning. It all starts with getting the leadership team's ideas, then input from the right audiences, along with the right dose of creativity:
Methodologies & data mixes
Given your scenario, we’ll mix up the right blend of data from the right audience, using methods from our pantry:
1:1 interviews
Group discussion
Online surveys
In-market testing
Observational research
Secondary research
1. Differentiating on a crowded hill
Often clients find that their competitors are copying their messaging at every turn, even if the competitor is being less than honest about what they can deliver. While we can’t guarantee a competitor won’t copy your message, we can create a message that’s unique to your DNA so you can credibly defend on your turf.
KEY DATA INGREDIENT: Deep dive with your tech guru to get under the hood; one-to-ones with your customers to translate into benefits; group discussion and surveys with prospects to test it out; in-market testing.
CLIENT EXAMPLES: Qlik, EDS, oDesk, FinancialForce, Snowflake, Databricks, Alteryx, Beyondcore, Reltio
2. Creating a hill
So, you have a new baby to bring to market hoping to disrupt an industry. Starting out on your journey can be exciting and confusing at the same time. How do you define the hill that will make a mark in the industry?
KEY DATA INGREDIENT: Secondary research on competitive landscape, one-to-ones with investors and beta customers; concept testing with at least 10 prospects.
CLIENT EXAMPLES: Keyssa, Dell KACE, RichRelevance, TiVo, FloQast, DocuSign, SHIFTMobility
3. Moving to a bigger hill
Congrats, you've proved success on your current hill and are ready for your next step toward growth! Our favorite examples include Amazon, who started by owning the "online books" hill and grew to own the "e-commerce" mountain. How do you find your next, credible bigger hill?
KEY DATA INGREDIENT: One-to-one interviews with current customers making the case for why you’re best positioned to take the next hill. Group discussion and surveys with prospects and in-market testing.
CLIENT EXAMPLES: Dynamic Signal, Centrify, Reltio, Apigee
4. Reaching new audiences
Say you’ve been selling to one function, like IT, and now you want to sell to a line of business like sales or marketing. Or, you’ve been selling directly to architects and now want to sell to the CIO or CISO. How do you expand to this new audience without alienating your existing customers, so they grow with you and continue to serve as references?
KEY DATA INGREDIENT: Input from current audience to make the case for new audience. Qualitative research with new audience.
CLIENT EXAMPLES: Malwarebytes, Adobe, Actuate, Covisint, UT Starcom, Dell, HP
5. M&A and joint ventures
Mergers and acquisitions can be an important ingredient for your strategy, but can be confusing to your market. Joint ventures can result in messaging battles so you need the voice of the market to sort it out. Our favorite ZOOMing in this area was aligning 3 enterprises around Cisco’s joint venture Acadia, with VMware & EMC.
KEY DATA INGREDIENT: You’ll need input from customers of all involved companies, plus at least 20 prospects for your combined offering.
Getting the “right” data
How do you get the “right” data to inform your positioning so you instill confidence in the results? Here are simple guidelines to get started.
Your team:
Start with leaders and stakeholders who know your business, strategy and vision. However, market data is key. We find that 95% of concepts from internal teams don’t end up as the final answer.
Your current audience:
Customers, partners and analysts who are your fans, “get” where you’re going, and that you respect. They’ll help focus your message on your best attributes.
Your future target:
Prospects who fit your buyer profile, but don’t know you. Testing whether your message sounds interesting and credible with this more skeptical crowd is key, as they represent your growth.
The case for data-driven
Many clients ask why testing is even needed. Here's a couple of common questions:
1. Why ask customers, they don’t know what they need?
We agree! Customers and prospects may not know they want a smart phone or a self-driving car, that’s where your innovation plays the central role. But, they certainly know what descriptions will catch their attention and convince them your product is superior. We’re not suggesting you use customer and prospect feedback to innovate your product, but to nail the message.
2. We’re creative, why can't we figure it out ourselves?
Sure, creativity is woven throughout the positioning process. We simply believe in adding a step of testing the creative ideas to find out what wording resonates and will stick. Creativity is step one, testing is the reality check to move beyond the “inside-out” view to an objective “outside-in” view that is true and current. As a bonus, listening to customers and prospects often yields unexpected insights beyond positioning.