Top Psychologist: The Tools to Accomplish Your Hardest Goals and Change Your Mindset

0:00:04 So you can’t tell just using, you know, what I would call the grandmother test, you know,
0:00:07 would your grandmother understand this? Well, unless you’re selling to grandmothers,
0:00:11 it doesn’t matter if the grandmother understands it. So some people will say,
0:00:15 well, we need to dumb this down and we need to have it so that anybody understands it.
0:00:20 I super disagree with that in B2B. If I’m selling a specialized thing to specialized buyers,
0:00:35 it just needs to resonate with them. It’s okay if it doesn’t resonate with your grandmother.
0:00:44 Welcome to The Knowledge Project. I’m your host, Shane Parish. In a world where knowledge is
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0:01:06 Check out the link in the show notes for more information.
0:01:12 My guest today is April Dunford. Her book, Obviously Awesome, totally changed how I think
0:01:18 about positioning when it comes to business. This interview originally aired as a members-only
0:01:23 episode, but I had so many requests for members to share it with their team at work that I decided
0:01:28 to make it public so everyone can benefit. April is an expert in product positioning,
0:01:34 and this episode goes from high level to very detailed examples. We discuss the critical
0:01:39 role of positioning as a strategic approach, not just a marketing exercise capable of totally
0:01:44 transforming a product’s trajectory. April illustrates this with the example of labeling
0:01:49 a muffin a muffin and not a cake, demonstrating how effective positioning can shift perceptions
0:01:54 and drive sales. If you’re interested in getting more sales, loyal customers and bigger promotions,
0:01:58 this episode is for you. It’s time to listen and learn.
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0:03:09 Rogers Internet. Visit rogers.com for details. We got you, Rogers. I want to start with the basics,
0:03:16 what is positioning? It’s interesting, so I’m a positioning expert and when I started out as
0:03:21 a consultant being a positioning expert, the worst part about that is nobody really knows what
0:03:26 positioning is. They think they do, so people will say positioning, that’s just like messaging,
0:03:31 isn’t it? I’m like, actually, no, it’s not quite that. Or they’ll say positioning is like a tag
0:03:36 line. We’re coming up with a tag line and I’m like, oh gosh, no, there’s a lot of things that we do
0:03:43 that aren’t tagline related. My personal pet peeve is when people talk about brand positioning,
0:03:47 that drives me nuts. There is positioning and there’s branding. Those two things are actually
0:03:53 really separate. So most of the things that we confuse with positioning are actually things we
0:03:59 do with positioning once we’re done with it, but positioning is an input. So if you think about
0:04:04 it this way, if everything we do in marketing and sales is the house, positioning is the foundation
0:04:11 upon which the house is built. So my definition of positioning goes like this. Positioning defines
0:04:19 how your product is the best in the world at delivering something, some value that a well-defined
0:04:24 set of customers cares a lot about. Now that’s a bit of a mouthful. A lot of the folks that I work
0:04:29 with are not marketing people, they’re CEOs of tech companies so they don’t have a background in this
0:04:34 stuff. So I think the best way to think about it is it’s like context setting for products. It’s
0:04:42 the context I position my product in such that customers kind of have an idea like what is this
0:04:47 thing? What’s it all about? Why should I care? It’s a starting point for a conversation with a
0:04:54 customer. Can you give me an example? One of the things that really stuck out to me, I was always
0:04:59 trying to explain to tech company CEOs with a tech company example and whenever I did that,
0:05:05 the tech company CEOs would say well that’s a database and we’re not like a database so I thought
0:05:09 I need some examples that have nothing to do with technology. They’re really simple. So I was trying
0:05:15 to come up with an example and it was on my way to work and I went to Tim Horton’s coffee shop in
0:05:20 Canada. So I’m standing in line and the guy in front of me is ordering breakfast. It’s 8 a.m.
0:05:28 and he orders this thing which is a double chocolate salted caramel muffin and I was like
0:05:35 that is some genius marketing stuff right there. So I’ve got a piece of cake. It is double chocolate
0:05:42 caramel cake but if I put it in the muffin format and I call it a muffin, everything about that is
0:05:49 different. The whole context around it is different. It is socially acceptable to order double chocolate
0:05:56 caramel whatever if you say it’s a muffin because I’m now comparing it differently. So if I said it
0:06:02 was cake, what’s cake? Cake competes with other things that are like dessert. It competes with
0:06:07 ice cream and tiramisu and other things you would order for dessert. What does cake cost? Well in
0:06:13 a restaurant it’s 10 dollars, 15 dollars. Where do I get it? I might go to a bakery but I get it at
0:06:19 a restaurant too. When I’m talking about a muffin, well muffin’s totally different. A muffin’s breakfast
0:06:25 it competes with a bagel and a donut. What do I charge for a muffin? I charge a dollar, two dollars
0:06:32 for a muffin. The whole context around it is different. The product however is the same like
0:06:38 that thing that you’re eating is a piece of cake whether it’s in cake form or muffin form.
0:06:45 So I can choose to position it as a muffin. It’s the same product but the assumptions about that,
0:06:50 the competitors are different, your value is different. The assumptions that customers have
0:06:55 about that product are different because I’ve placed it in a different context. What are the most
0:07:01 common misperceptions about positioning that companies have? I would say the most companies
0:07:07 just don’t think about positioning at all. In the vast majority of cases, the companies that I work
0:07:14 with, the positioning feels obvious. It feels like you couldn’t possibly position it as anything else.
0:07:18 So it started like this. The founder woke up one morning and said, “You know what sucks? Email
0:07:23 sucks. We’re going to make way better email. It’s going to be fantastic and it’s going to fix all
0:07:28 these things I hate about email.” And then they launch it and customers say, “I like this part. I
0:07:34 don’t like this part.” They change it. It evolves over time. Maybe the whole market evolves. If we
0:07:39 fast forward two years from now, the founder and everybody inside of the company still says,
0:07:46 “Email. We’re building this email thing.” But maybe that product actually looks more like chat
0:07:52 because that’s kind of like email too. And so we’ll start having this disconnect where the customer
0:07:57 sees it and the company is saying, “Well, this is email. Look at our amazing email.” And the
0:08:02 customer is like, “I don’t know. That kind of feels like chat. You’re calling email. I feel like
0:08:06 maybe it’s chat and now I’m confused.” And I don’t really know what this thing is anymore.
0:08:12 When the company figures out they have a problem, like, “Oh, maybe this is an email. Maybe we should
0:08:17 reposition it.” Nobody knows what to do at that point because they never deliberately positioned
0:08:22 it or did a thing to decide it was email in the first place. It was just obvious. Of course,
0:08:27 it’s email. That was our idea. That’s what we’re going to do. Product positioning is basically
0:08:33 shaping the environment in the consumer’s mind by which they draw comparisons and know what to
0:08:40 expect. That’s a good way to describe it. It’s a bit like the opening scene of a movie. So you
0:08:43 walk into the movie. Let’s say you’re going to a movie theater. You walk into the movie theater.
0:08:47 You know a little bit about it. You bought a ticket. But the job of the opening scene in the
0:08:52 movie is to set context for the movie because you have these big questions. Where are we? What
0:08:58 time frame is this? Who are these characters? What is the vibe of this whole movie? You need to get
0:09:04 these big questions answered before you can settle in and pay attention to the details of the story.
0:09:10 So if we take, I usually use apocalypse now as the example of a great opening scene. The opening
0:09:14 scene of apocalypse now starts with shot of the beach. It’s palm trees. It’s all nice. It’s lovely.
0:09:19 You walk in and you might think, I know it’s called apocalypse now, but maybe it’s not
0:09:23 apocalypse right now. Maybe it’s apocalypse 30 minutes from now. So you walk in, but suddenly
0:09:29 this thing changes. The music gets a little bit more intense. We see this thing. It looks like
0:09:35 smoke, dust, and you’re like, oh, it’s actually smoke. A helicopter goes by and boom, the beach
0:09:39 is on fire. And all of a sudden, we’re in the middle of the Vietnam War. And then the scene
0:09:44 changes and it’s Martin Sheen. He’s in his hotel room. He’s drinking, smoking. He’s clearly in
0:09:49 distress. He walks over the window. He peeks out the blinds and we get the first line of dialogue,
0:09:54 which is actually his thoughts of the movie. He looks out and he says, Saigon. Shit. I’m still
0:09:59 only in Saigon. Every time I think I’m going to wake up back in the jungle. So here we are. We’re
0:10:06 three minutes into a three and a half hour movie and we know a lot. Where are we? We’re in the middle
0:10:12 of the Vietnam War. Specifically we’re in Saigon. Our lead character has been there before. It didn’t
0:10:17 go so well. He has PTSD. This movie is not going to be funny. It’s going to be kind of intense.
0:10:22 Now I can settle in and pay attention to the details of the story. Positioning works the same
0:10:30 way. If I walked up in Shark Tank or I forget what we call it here in Canada, what’s it called?
0:10:37 Dragon’s Den. So let’s say we have weirdo Dragon’s Den and I’m not allowed to give you my whole pitch
0:10:43 for something. I’m just going to talk about the market category. So the category that the product
0:10:49 is positioned in. So I walk out and I say, I’ve got this amazing thing. It’s revolutionary next
0:10:56 generation thing, but it’s CRM customer relationship management. If you’re tech people and you know
0:11:00 what a CRM is, you will make a whole bunch of assumptions about that product just because I
0:11:05 called it a CRM. So you’ll say, well, you must compete with Salesforce. They’re the absolute
0:11:10 leader in that market, the gorilla in that market. So I will just assume that you compete there.
0:11:15 I will make assumptions about what that product does. I will assume that it tracks deals across a
0:11:20 pipeline. I will assume who the buyer of that is. I’ll assume it’s the head of sales, vice
0:11:26 president of sales. I’ll even make an assumption about the pricing, even though I said nothing about
0:11:32 what that thing is or who the expected customers are of that thing. But if you assume that Salesforce
0:11:38 is my big competitor, because they’re the absolute leader in that space, I’m not charging more for
0:11:45 my CRM than Salesforce is. So this is how this works. What it does is I position that product
0:11:52 in a market category. That market category has set off a set of assumptions in the customer’s
0:11:59 mind about that product. If I do this well, it sets off a set of assumptions about that product
0:12:04 that are true, and that’s great. Now I’ve saved marketing and sales a whole lot of time, energy,
0:12:09 effort. I don’t have to tell you exactly who my competitors are. It’s assumed. I don’t have to
0:12:14 list every single feature. A lot of that stuff is considered table stakes in the category.
0:12:20 But it works the same way if I do a terrible job of it. So if I do a terrible job of it,
0:12:25 I position my product in a market category such that it sets off a set of assumptions about my
0:12:31 product that are not true, now marketing and sales has their work cut out for them on doing this
0:12:35 damage that you’re positioning is already done, where they’re like, no, no, no, we don’t do that.
0:12:38 No, no, no, I know you think that. No, no, no, it’s not that. It’s this other thing.
0:12:44 So if I’m trying to compete with Salesforce, should I do that in a way where I have a product?
0:12:50 It’s probably inferior because I’m a startup. Right. And so we can’t go toe to toe on every
0:12:57 aspect. How do we position that in a way to a consumer, which in this case would be a business?
0:13:04 A business that’s a buyer. The most common way that tech companies successfully position
0:13:12 is they find an underserved sub-segment of the market. And then they attempt to dominate that
0:13:18 sub-segment and then push out from there. So I can give you an example. I worked at a company
0:13:26 called Janna Systems. And at the time, this was quite a while ago. So Sebal or Salesforce was
0:13:30 a small company at that point and only selling to the very low end of the market. But the gorilla
0:13:36 in that space at the time was a big, big company in Silicon Valley called Sebal. And so they were
0:13:41 fantastic company, two billion revenue, fastest company to ever get to a billion revenue in the
0:13:47 history of Silicon Valley. Amazing success story. They were positioned as enterprise CRM. They were
0:13:53 the absolute kings of enterprise CRM. We had a product that was also enterprise CRM. So we would
0:13:58 position ourselves as enterprise CRM. And so not surprisingly, we would get a meeting with a customer
0:14:04 and the customer would say, okay, so your enterprise CRM, their enterprise CRM, how are you better?
0:14:11 And the answer to that question was we simply weren’t better than them. We had, you know,
0:14:16 we had two million revenue, they had two billion revenue, they had 400 customers, we had six,
0:14:22 they had thousands of employees, I was employee 26 or something. I mean, we were just no comparison
0:14:31 at all. However, we had a feature that they could not copy that was really interesting.
0:14:36 And we thought it would be really valuable to customers. We didn’t really understand the value
0:14:41 of it for customers. But we always showed it in meetings. So we go in, we show the thing, it’s
0:14:45 this neat feature. And we say, Hey, here’s the feature, it’s really great. And customers would
0:14:50 look at us and say, Hey, that looks cool. What do we do with that? And we’d say anything you want.
0:14:57 And then the customer would say, Okay, well, that’s confusing. What else you got? And then we’d say,
0:15:00 Well, you know, we’re really cheap. If you want us to be really cheap, because we’re desperate to
0:15:05 close business, how we got out of that mess and eventually landed on positioning that was really
0:15:13 good for us is we, we sold a deal to an investment bank. And it was kind of by accident. We hired a
0:15:18 sales rep that had a relationship with somebody very senior at the investment bank, that we did a
0:15:25 good pitch in there, we showed them our magical feature. And what that customer taught us is
0:15:31 that feature was actually very, very valuable to investment banks and the way that they wanted
0:15:36 to manage relationships inside the bank. Once we figured that out, then it was like, okay,
0:15:41 we actually have a feature that’s really, really valuable for a sub segment of this big market.
0:15:48 And we knew at the time, Siebel couldn’t copy us on that feature. So we narrowed down the positioning
0:15:53 and instead of saying we were enterprise CRM, we were CRM for investment banks. And the great
0:15:59 thing about that is that we never got into a real head to head against those guys again. So we would
0:16:05 come in and say, Hey, we’re CRM for investment banks. And the customer would say, Oh, well,
0:16:10 wait, doesn’t Siebel do that? Like, don’t you guys compete with Siebel? And we’d say, Oh, Siebel,
0:16:18 we love those guys. So big, so smart, so many people. They’re like the world’s greatest general
0:16:23 purpose CRM for like call centers and manufacturing plants. And I don’t know what, but not you,
0:16:28 Wolf of Wall Street, you need something special. Let me show you this thing that we would show them
0:16:34 the thing and talk about the thing. And so our plan was to absolutely dominate that space.
0:16:38 And then once we had dominated that, we would be building the product and making the product
0:16:44 more mature. And our dominance and investment banking was going to allow us to get into retail
0:16:48 banking. So we were going to expand the market from there. And then if we were successful in
0:16:53 retail banking, that would allow us to get into insurance. At that point, we would reposition
0:16:59 ourselves as CRM for financial services. If we were successful there, then we’d be big enough
0:17:03 and successful enough to challenge the market leader and take over and be enterprise CRM,
0:17:10 which was still the long term goal. So is this about shrinking your target market or your ecosystem
0:17:14 in a way in which you’re going to compete to one where you have an advantage or an edge over somebody
0:17:20 else and then expanding from there? Often in technology companies, that’s exactly what we’re
0:17:30 doing. That seems like very intuitive. There’s a lot of reasons. So the biggest one is people get
0:17:37 very worried about what we call the addressable market. So if I was trying to fundraise and went
0:17:43 to an investor and said, look, I want to build a thing and it’s just CRM for investment banks,
0:17:47 the investor would say, well, how many investment banks are there in the world? I need you to be
0:17:51 a billion dollar business. That’s not a billion dollar business. I don’t know how you’re going to
0:17:59 do that. For an investor, you need to talk about the long term story. Where do we want to be in
0:18:06 10 years? What is our path to getting to be a billion dollars? And if I look at that example I
0:18:12 just gave you, we had that long term vision. We were going to be a billion dollar company eventually.
0:18:18 But for most companies, when you start, I’m not trying to do a billion dollars this year. I’m
0:18:23 trying to do a million. I’m trying to close five deals. I’m trying to close 10 deals. And in order
0:18:28 to close any business at all, you have to be the best. That’s something. The customer’s not going
0:18:33 to come in and say, you know, there’s these three options and I’ll pick this one that’s just okay.
0:18:39 No, the customer says they want the best thing for their particular thing. So great positioning
0:18:45 is all about defining where do you win? Where are you the best in the world? And even if that
0:18:51 market is very small at the beginning, you need to have a pathway to get to this bigger market. So
0:18:56 I’ll win here, then I’ll win here, then I’ll win here, and the market will expand. So the vast
0:19:02 majority of companies that we know did exactly that. Salesforce is actually a great example.
0:19:10 When they started out, the enterprise part of CRM was absolutely dominated by a big competitor.
0:19:15 So it didn’t make sense for them to enter that market there. Instead, they entered the market
0:19:21 at the very bottom. So they were selling to small, medium businesses. And their secret sauce or the
0:19:26 thing they could do better than anyone else is they were one of the world’s first SaaS businesses.
0:19:33 So it was hosted in the cloud. The value to the customer was that you could get CRM just like
0:19:39 the big companies had, even if you didn’t have an IT department to babysit it. So their big slogan
0:19:44 of no software was all about that. They were selling to tiny companies that had no IT department that
0:19:50 could never touch CRM. And there was no competition there. So it was very easy for them to go in.
0:19:56 And I was working at Siebel at the time. And when they started down at the bottom, we were like,
0:20:00 we don’t care about that market. We’re not going to chase them down there. We sell great big
0:20:09 million-dollar enterprise deals. We had no interest in that. Our goal was to just sit in
0:20:15 the very top of the stack and just sell all of that. And that was it. So of course, what Siebel
0:20:20 did was they started at the bottom and then crawled their way up. That’s fascinating. So
0:20:26 basically to compete from a staffing point of view, from a VC funding point of view,
0:20:32 you sort of say our total market is huge, but then on a practical basis to develop a product.
0:20:36 Right. You have to start small in a lend and expand sort of fashion.
0:20:42 Generally, if you look at most, the vast majority of successful companies,
0:20:49 they’ve started by dominating a market that was too small for the market leader to care about.
0:20:54 They dominated that market. And then what they did was they proceeded to push the boundaries of
0:21:00 that market and creep closer and closer and closer to whoever the market leader is.
0:21:05 What’s the difference between B2B positioning and B2C, like business to business positioning
0:21:10 versus business to consumer positioning? There’s a lot of things that are different.
0:21:16 Kind of, if we think about the core of good positioning, the core of good positioning
0:21:22 is thinking about what your differentiated value is, meaning the value you can deliver
0:21:27 for a customer that no one else can. And then great positioning puts that in a context that a
0:21:34 customer can understand it. If we think about value in B2B, it’s very different than value
0:21:41 in consumer products. Value can be all kinds of things in consumer products. I might buy shoes
0:21:47 because I just like the color green, man, or I’m buying consumer things because I think it makes
0:21:53 me look rich, or it’s going to get me a date, or there’s a lot of different things that are valuable
0:22:00 in consumer. In business to business, it’s very different. In business to business, typically,
0:22:07 there isn’t one person buying. Typically, there’s a group of people. The average B2B deal,
0:22:14 there’s five to 11 stakeholders in the deal. If I’m buying accounting software, my boss comes
0:22:18 to me and says, “Hey, I don’t like the accounting software we have right now. You go buy us some.”
0:22:25 That’s terrifying. My neck is on the line. If I make a bad choice here, I look bad in front of
0:22:30 my boss. The end users don’t like it. Maybe the software screws up. I get passed over from a
0:22:37 promotion, I might actually get fired. There’s stakes in a B2B purchase decision. The way we
0:22:43 think about value is also really different. I can’t go to my boss and say, “I just like the vibe of
0:22:51 this software. I have to make a business case to my boss for why we should buy it.” In businesses,
0:22:55 I mean, we kind of only have two things. We’re either helping you make money or we’re helping
0:23:03 you save money, and that’s about it. I might make a very irrational decision about a product,
0:23:09 and often we do make very irrational decisions even in B2B about a product,
0:23:15 but I can’t say that to my boss. I still have to go to my boss and say, “Here’s why we picked it.
0:23:19 Here’s the list of reasons.” There needs to be some justification. That’s exactly it.
0:23:26 That’s explainable to somebody else. Exactly. In consumer, consumer marketers talk a lot about
0:23:35 emotion, invoking emotion. In B2B, the granddaddy of emotions is fear. Fear of making a poor choice.
0:23:40 Fear of looking bad in front of my boss. Fear of getting fired. Fear of making a mistake
0:23:47 drives a lot of decisions in B2B. This is why incumbents, like whoever’s the leader in the market,
0:23:55 has such an advantage in B2B technology because it is the safe decision. Nobody is going to get
0:24:01 fired for picking Salesforce at this point. They have double the market share of their closest
0:24:06 competitor. You can go to your boss and say, “Look, I looked at all the other options,
0:24:10 but I picked Salesforce because everybody uses Salesforce. They have a big ecosystem.
0:24:14 They have the best this, the best that. They’re the biggest. It’s the safe choice to make.”
0:24:19 If you’re trying to compete against Salesforce, that’s really hard gravity to pull against.
0:24:27 It’s very risky to pick you if the choice is you versus Salesforce or an established market leader.
0:24:33 When you think about consumer positioning, I’m really interested and I know this isn’t your area
0:24:40 of expertise, but when you walk into Louis Vuitton or Mads, how do you think about positioning
0:24:48 such that they can charge $30, $40,000 for a first? The $30,000, $40,000 is the point.
0:24:56 I’m not buying that bag because I think it’s $30,000 better than a bag that costs 20 bucks,
0:25:02 although it probably is finely crafted and all that sort of thing. A lot of times, I think luxury
0:25:10 goods are really about a signal to the market. It’s like I’m a rich, successful person that has
0:25:17 made enough money that I can carry a Louis Vuitton bag or wear a Rolex watch or whatever luxury
0:25:24 things are. It’s outside of my wheelhouse, but again, when we look at consumer stuff,
0:25:32 value comes in all sorts of forms. We buy things in very rational ways in consumer products.
0:25:39 We’re also irrational in B2B too, but most of that irrationality is around fear. It’s like,
0:25:43 I just don’t want to make a bad choice here and look bad in front of my boss or do something
0:25:47 that the company’s all mad at me about later. The thing we have in B2B that’s actually a real
0:25:57 problem is it’s so scary to purchase something in B2B that 50 to 70% of the time, a deal that gets
0:26:05 started actually ends in no decision. The no decision isn’t voted to stay with the current
0:26:10 product that they have. It’s usually no decision because everything looked the same. I couldn’t
0:26:15 confidently make a decision that I was sure I wasn’t going to get in trouble for. It’s easier
0:26:19 to just go back to your boss and say, you know what, now’s not a good time. Let’s buy the accounting
0:26:25 package next year. We don’t need to get into this now. The person who’s been tasked with making that
0:26:29 decision is just crossing their fingers that they don’t have to be on the hook to make the
0:26:33 decision next year. When the decision comes up again, like, okay, let’s go and look again,
0:26:38 they just don’t want to be the person that has to stick their neck out to advocate for something,
0:26:45 which is totally different from how we buy a pack of gum or buy fizzy water at the corner store
0:26:51 or buy a purse. The downside there is really small and at work, the downside’s huge and the
0:26:57 upside’s like nothing. Right. If you advocate for a different product that’s outside of standard
0:27:03 best practices or standard industry standard, then if you’re successful, everybody forgets
0:27:10 that you advocated for it, but if it fails, you probably lose your job. Exactly. In rare cases,
0:27:18 you’ll see senior executives at companies where their role is to change things. So their role is
0:27:23 transformation in some way, innovation, transformation, or a digital transformation.
0:27:28 You see a lot of companies right now that have been tasked by the CEO where there are teams that
0:27:34 have been tasked by the CEO to figure this AI thing out and make sure we’re not falling behind.
0:27:42 In those cases, the person driving that program, if it is successful, is going to get a promotion,
0:27:47 they’re going to get a raise, it’s going to look really good on them if they can successfully do it.
0:27:54 If it’s not successful, then they’re a bum. Would you say the biggest mistake then that you see,
0:27:58 especially with software products, is competing and positioning in too big of a market?
0:28:05 That’s one of the things. I think a lot of times, if you look at the positioning that the company
0:28:12 has, the biggest mistake is not deliberately positioning. I think a lot of companies start
0:28:19 looking at their product in isolation almost, like there are no competitors. You see it a lot
0:28:24 in the way companies do sales pitches. They’ll walk in and they’ll give this sales pitch. They’ll
0:28:28 talk about the product with this great feature, that great feature, this great feature. It’s
0:28:35 amazing. You should buy us. The buyer on the other side of that conversation, they’re terrified of
0:28:41 making a bad choice. They’re sitting there going, “Well, that’s all great, but I just had three
0:28:47 other sales calls with your competitors. Some of that stuff sounds the same.” We walk into these
0:28:52 situations as vendors in general, thinking that the question we’re trying to answer is,
0:28:58 “Why pick us?” The real question we have to answer is, “Why pick us over the other guys?”
0:29:05 I think most companies don’t really wrestle with that. They don’t sit down, put themselves in the
0:29:10 shoes of a buyer, recognize how hard it is to make a purchase decision, and think,
0:29:15 “How do we position versus everybody else?” It’s really easy to go with the incumbent,
0:29:21 the largest. Then you have to basically get people out of that default sometimes.
0:29:26 Exactly. That’s fascinating. Can you tell me what a time when repositioning
0:29:36 a product failed and what happened? I worked at a company where we were building a thing.
0:29:42 The original conception of this thing was that it was a database, but it was a really fancy database
0:29:49 that could do a certain kind of query really, really fast. It was originally developed for a bank.
0:29:58 There were a set of queries that the bank did that were so difficult to process that they would
0:30:04 run them on Friday and the query took all weekend to get the answer back. You’re asking the data
0:30:10 this question and it took three days to get the answer back. These folks, a couple of super genius
0:30:16 database guys, came up with this database to fix that problem and it could run that query
0:30:23 in seconds. It’s amazing technology, fantastic. They got patents on it. Nobody’s seen a database
0:30:29 like this before, really, really innovative. The original conception of this thing was that
0:30:38 it was a database. I joined as the head of marketing and we were having a terrible time
0:30:43 selling. The positioning was terrible. Nobody wanted a new database. There’s an absolute giant
0:30:47 in that market. They’re called Oracle. Everybody’s standard on Oracle. Everybody gets certified on
0:30:53 Oracle. Companies don’t want to have multiple database solutions to do something. We would come
0:30:59 in and say, “We’ve got this nifty new database,” and the customers would say, “Well, we’re Oracle’s
0:31:02 shop. We’re not married to Oracle. We don’t think Oracle is the best thing, but we can’t bring in
0:31:09 another platform.” We eventually repositioned it as a data warehouse, which is a specific,
0:31:13 purpose-built kind of database for doing analytics, which is exactly what we’re doing when we’re
0:31:19 doing this big query. We did that repositioning and it was much, much better, much better.
0:31:25 First call was better, much better than we were doing before. The problem was when we looked at,
0:31:32 we had an assumption that if you had these queries that took three days, you would want to be able
0:31:37 to do them in 10 seconds versus three days. It turned out that assumption was wrong. When we went
0:31:43 to the other banks and said, “Hey, you’re doing this thing and it takes three days,” you could use
0:31:48 this thing and it would take three seconds and they’re like, “It’s okay. Nobody’s really doing
0:31:53 anything over the weekend anyway. We don’t need the answer right away.” Then we had this question,
0:31:58 “Well, who needs the answer right away?” We had never asked ourselves that question. Our whole
0:32:06 value proposition is speed, doing this query fast. It turned out the only customers that needed the
0:32:14 answer right away were customers that were doing the query for customer service. Their customer
0:32:17 calls in, they’re on the phone and they’re like, “Hey, I need to know this thing. Well, I don’t want
0:32:24 to wait three days to get the answer. They want to do it in seconds.” Then we looked at the universe
0:32:30 of companies that had data of a scale where our thing was appropriate and needed this query
0:32:35 answered to do customer service and there was literally 10 companies on the planet and that
0:32:43 was it. The addressable market was so small that it wasn’t a viable business. We had essentially
0:32:49 built a product that nobody wanted. It was neat. It was really innovative. It was really cool,
0:32:52 but there was no market for it. It didn’t solve a problem that anybody really had.
0:32:57 So, if you’re a startup, you have limited resources, and how do you go about identifying
0:33:00 those pain points then to better position your product?
0:33:10 The idea behind the famous book on this is Eric Reese’s Lean Startup. The way the Lean Startup
0:33:15 describes this is you should be out doing something called customer discovery. Before
0:33:21 you write anything, you should be out interviewing customers or potential customers and validating
0:33:28 the assumptions that you have about this market. Is this a thing that people would pay for? How
0:33:34 much would you pay for it? Are there a big enough group of people that have this pain to solve it?
0:33:40 In a perfect world, that’s what we would all be doing, but often products just don’t happen that
0:33:47 way. Often products like this particular company, they had built it custom. They had done the deal
0:33:52 with the bank in such a way that they owned the IP. It seemed like a good idea. They had a bunch of
0:33:56 assumptions baked in there. They never tested those assumptions until later, but it was good
0:34:00 enough to go raise money. They just went and raised some money and, “Okay, now we’re going. We’re doing
0:34:06 a thing.” So, I don’t think a lot of startups do enough customer discovery at the beginning to make
0:34:11 sure that they’ve got a thing that people really want. The second thing is that even if you do do
0:34:17 customer discovery, it’s really hard. It’s really difficult. Customers will sometimes tell you things
0:34:22 that aren’t true, where they’ll say, “Yes, yes, we would buy that and we would buy it for this much.”
0:34:26 But by the time you’ve actually built the thing and you have a prototype of the thing and you get
0:34:29 it in customer’s hands, they’re like, “Actually, there’s a different way to do this and we decided
0:34:34 to do it this different way.” You know that customers have lots of options. So, startups are
0:34:41 very hard because we’re dealing with uncertainty. We’re dealing with a certain amount of assumptions.
0:34:46 Our assumptions may prove to be wrong and we have to be able to move and pivot and look for other
0:34:51 things. Sometimes, our first crack at it isn’t going to work and we’re going to have to go back
0:34:56 to the drawing board and kind of invent something else and see if that works. How do you position
0:35:03 your product on a page? A lot of B2B starts with a sales rep or somebody looking at a page for a
0:35:08 product. How do you position that product? You probably, I don’t know, 10 seconds to get somebody’s
0:35:13 attention. Yeah, 10 seconds to get somebody’s attention. So, the way I think about positioning
0:35:20 is this way. I like to break positioning up into a set of components. So, the component
0:35:26 pieces of positioning are competitive alternatives. So, if you didn’t exist, what would a customer do?
0:35:31 And then we need to understand what makes us different, which is our differentiated capabilities,
0:35:35 like what do we got that the alternatives don’t have? The thing that we really need to understand
0:35:40 is why those features matter. So, what is the value that those features can deliver for our
0:35:44 business? And you mean the features that you have that nobody else. That no one else has. So,
0:35:49 that’s our differentiated value. It says, look, we can do this for your business and no one else
0:35:54 can do it. And then the next thing we have to understand is who cares a lot about that? Because
0:35:57 just because we have that thing, if only three people on the planet care about that, that’s not
0:36:03 a viable business. So, we need to understand that. So, what is it? What are the characteristics of a
0:36:07 target company that make them really, really care a lot about the thing that only we can do?
0:36:14 Once we have all of that, then we need to build messaging around that. So, if we think about
0:36:20 typical homepage of a product, it needs to communicate what is the value that we can
0:36:26 deliver that no one else can. And is this for me, me as the browser, the person that’s there?
0:36:32 So, I need to communicate who’s this for? Why is it different? Why is it better? And that’s
0:36:37 really hard to do on one page. You don’t have a lot of copy to do that. You don’t have a lot of
0:36:42 ways to do that. But that’s what we really have to focus on. The biggest mistake I see technology
0:36:50 companies making is they’re so certain that their features are valuable and people will just understand
0:36:54 what the value of those features are. They’re talking about the features, but they’re not talking
0:37:00 about why the features matter. So, they’re not talking about the benefit. Exactly. So, if I
0:37:06 use the example of the CRM company I was talking about earlier, we had a feature. We just assumed
0:37:11 that customers would look at that feature and know what the value was. But they didn’t. They
0:37:16 didn’t. And so, all we did was talk about the feature. We’re like, “Look, you can model relationships
0:37:22 this way.” And they were like, “But why? Why do I actually want to do that? What’s that good for?”
0:37:25 And we’re like, “What’s good for anything you want to do with it?” Like, you figure it out.
0:37:33 And I think in technology companies, we’re very technical people. We know a lot about technology.
0:37:38 We get so close to it. We just assume that the customer can make the translation from feature
0:37:42 to value. But a lot of times they can’t. And in particularly with something that’s
0:37:48 really innovative, really new, they’ve never seen it before, we’re going to have to help them understand
0:37:52 why those features are important. If we think about a lot of consumer tech,
0:37:59 we’ve been trained how to do this. Like, if I tell you I’ve got a phone on my camera and it’s
0:38:05 2,000 megapixels, you know 2,000 megapixels is way better than 100 megapixels. You’ve been trained.
0:38:11 We know that. But the first time anybody ever talked to you about megapixels, you had no idea
0:38:16 what a megapixel even was. Companies had to teach you why that was important.
0:38:20 It’s interesting because that’s sort of gone away at this point. Like, nobody’s asking how many
0:38:23 megapixels are in their phone. At one point, it was like a big differentiator.
0:38:31 But that’s a good sort of segue into my next question, which is, how has the digital transformation
0:38:35 over the last 25, 30 years changed positioning?
0:38:42 I think the fundamentals of positioning haven’t changed at all, is my opinion. If you read the
0:38:46 original book on positioning, it was called Positioning the Battle for Your Mind by these
0:38:53 guys, Reason Trout. They came up with the concept. They published a book in 1982. And if you read that
0:38:59 book, the first chapter talks about why do we have to worry about positioning? Why is positioning
0:39:07 important? And they talked about how it’s important because previous to that, in any given market
0:39:13 category, there were only a handful of products. So consumers just made a choice between the two
0:39:18 or three choices that they had. But it wasn’t all that important for companies to really differentiate
0:39:25 between those choices. But in 1982, oh my gosh, we have so many choices now, positioning is really
0:39:31 important because the customer has thousands of choices, hundreds of choices. Now, if we look at
0:39:41 the difference between 1982 to now, that has just exploded. Like, I think it’s much more important
0:39:48 now to really establish that position. It’s much harder now to stand out in a world where
0:39:54 we’re exposed to millions of advertising messages a day. Like, think about digital stuff. I am
0:40:01 constantly bombarded with messages from companies. I cannot avoid it. It’s millions a day compared
0:40:10 to 1982. So in order for customers to really stick out, sorry, in order for companies to really stand
0:40:16 out in a market that is so crowded and so overwhelmed with messages from brands,
0:40:22 we’re going to have to get really succinct on what is this thing? What is the value of this thing?
0:40:26 Who is it for? How is it different from the other things in the market? And we’re going to have to
0:40:32 be so clear about that to break out from the noise. And why you should trust us? Because if we’re a
0:40:36 small company, we’ve got like five employees and we’re competing with Salesforce, but we have one
0:40:41 particular feature that they don’t have and we have our sort of positioning at our niche market.
0:40:45 Well, now there’s still a brand issue because it’s like nobody’s ever heard of you.
0:40:52 A lot of this stuff. So if I go back to that example of that CRM company I was in,
0:40:59 the great thing about that was we managed to establish ourselves in this little bubble
0:41:06 of investment banking. And once we had done two customers in investment banking,
0:41:11 we were the kings of investment banking with only two customers. Because we could walk in and say,
0:41:17 well, you know, Goldman Sachs and Merrill Lynch, what do they got? They got a bunch of call centers
0:41:23 and a bunch of manufacturing. And so we could put a circle around it and kind of make like the rest
0:41:28 of the market doesn’t matter to you, investment banker, like you don’t want the world’s greatest
0:41:34 general purpose CRM. You want the world’s greatest CRM for people like you. That’s how we win in this
0:41:38 thing. If I walk in and say, we’re just CRM, we’re CRM for everybody and we’re just the greatest
0:41:44 CRM ever, nobody wants that. It’s like you’re changing the frame almost like taking up a
0:41:49 photographer. Like there’s this great quote about, you know, what makes a great photograph is knowing
0:41:53 where to stand. And it’s like you’re basically almost picking somebody up and you’re being like,
0:41:58 look at this way. Yeah, this is the this is the Warren Buffett quote, you know, how do you beat
0:42:04 Bobby Fisher? You play him at any game but chess. How do you go about evaluating product positioning?
0:42:12 This is an interesting question. People want me to look at their website and tell me whether or
0:42:19 not their positioning is good. And in B2B, that is almost impossible. Almost impossible. So you
0:42:26 have this thing, it serves a market, I am not the buyer for that thing. So I could look at your website
0:42:31 and say, I don’t have a clue what this is all about. But the thing you sell is for airplane
0:42:36 mechanics. It’s fine if I don’t have a clue about that. It needs to resonate with airplane mechanics.
0:42:42 So you can’t tell just using, you know, what I would call the grandmother test, you know, would
0:42:46 your grandmother understand this? Well, unless you’re selling to grandmothers, it doesn’t matter
0:42:51 if the grandmother understands it. So some people will say, well, we need to dumb this down and we
0:42:56 need to have it so that anybody understands it. I super disagree with that in B2B. If I’m selling
0:43:01 a specialized thing to specialized buyers, it just needs to resonate with them. It’s okay
0:43:05 if it doesn’t resonate with your grandmother. What it does mean is if we’re trying to assess the
0:43:15 positioning, what really matters is when we are, when we have a brand new prospect that comes in
0:43:20 that doesn’t really know too much about us, how long does it take us before it clicks?
0:43:25 And they’re like, Oh, I get it. Oh, I get why you’re different. Oh, I get why that’s good. Oh,
0:43:33 I get why in my career. So I used to be an in-house vice president of marketing. And so the latter
0:43:38 part of my career, I was very focused on positioning. So if the CEO hired me, they hired me because I
0:43:42 could talk intelligently about how we were going to fix this positioning. I would come on board
0:43:47 and what everybody would want me to do is just run campaigns, April, make the revenue go up to the
0:43:52 right. And I was always worried about running campaigns on weak positioning because it’s a
0:43:57 bit like pouring water into the leaky bucket. And so what I would do to assess the positioning,
0:44:03 whether it was good or not, is I would walk over to sales. And there would be people doing sales
0:44:08 people doing first calls with customers. And you hear it in a first call. And it sounds like this,
0:44:15 your sales rep is doing a great job. They have a pitch customers there. And the sales rep has
0:44:21 a pitch that’s maybe a dozen slides long. And they’re saying, okay, here’s what we are. Here’s
0:44:25 what we do. We do this thing. They’re getting into the pitch. And you’ll see the customer. If it’s a
0:44:32 video call, you’ll see the customer and they’ll be making this confused face. And what’ll happen is,
0:44:36 and they’re not saying too much, and a good rep will stop and be like, are there any questions?
0:44:42 Like, are you with me still? And the customer will go, yeah, yeah, yeah, just back it up. Can
0:44:46 you just go back to the beginning, back it up and go back to the beginning, pitch it to me again.
0:44:51 And, and there’s this fundamental disconnect, like, I don’t even know what bucket to put this
0:44:56 thing in. Like, is it a, is it a database? Is it a business intelligence tool? Is it a thing?
0:45:02 Like, you have a frame to figure it, you know, and so there’s something in that positioning
0:45:06 that is just confusing the heck out of the customer. That’s the most common sign you see is the
0:45:11 customers looking at it and they’re like, I just can’t figure out what this thing is. The second
0:45:16 common sign you’ll see with weak positioning is the customer thinks they’ve got it figured out,
0:45:21 but they’re actually comparing you to something that you don’t actually compete with. So you’ll
0:45:25 get to slide three or four and the customer will say, yay, I get it. You’re just like Salesforce
0:45:28 and you’re nothing like Salesforce. You don’t compete in that market. You’re not that. And then
0:45:32 the rep is like, no, no, no, no, no, let me go back. I’ll go back to the beginning. We’ll do this again.
0:45:38 So you’ll hear that a lot. The other thing you’ll hear, and this is almost the most terrifying one,
0:45:45 is in these early conversations with a prospect. The prospect will say, I get it. I get what you are.
0:45:49 I get who you compete with. I just don’t really get why we would pay money for that.
0:45:55 Like, can I just do that with a spreadsheet? Can I just do that with my accounting package?
0:46:00 Couldn’t I just hire an intern do that? Why would I pay money to do that? So they kind of understand
0:46:05 the product, but again, they don’t understand the value of it. Why would I give you money in
0:46:10 exchange for that thing? Who’s in charge of positioning at a company? Good question. This
0:46:17 has traditionally been seen as a marketing function. And even more specifically in tech
0:46:23 companies, we often say this is a product marketing function. But I don’t believe that. I think that’s
0:46:28 not the right way to think about it. If we really think about what we’re doing in positioning,
0:46:34 is we’re getting really tight on who’s our competitor? How are we different? What is the
0:46:41 value we can provide to the customer and who exactly are those customers? If we made a change in
0:46:48 that, that would be a big change in the business. If I think about, again, my CRM example, if we
0:46:55 switch from being general purpose enterprise CRM to CRM for investment banks, that’s a whole
0:47:03 different company. So I don’t think marketing has, first of all, they’re not talking to customers
0:47:12 every day the way sales is. They don’t necessarily understand the differentiation amongst competitors
0:47:19 the way the product team would. And sure as heck, the CEO is going to have something to say about
0:47:25 where we’re selling and how we win in the market. So in the work that I do with companies with
0:47:32 positioning, we do it with a cross functional team. So we bring together product marketing sales,
0:47:39 customer success, support, and we bring everybody together and everybody comes with what they
0:47:45 understand about customers and how we win. And we work through the positioning together as a group
0:47:52 exercise. Now somebody needs to be the steward or the police of that positioning once we’ve said it
0:47:56 to make sure that we are consistent about that in the way we’re using it in marketing and the way
0:48:02 we’re using it in sales. And that’s typically marketing that does that. I also think it’s good
0:48:08 to have somebody be the person that puts their hand up and says, you know what, things are changing
0:48:13 in the market. We maybe need to come back together and check in on that positioning. But I don’t
0:48:17 think that marketing should be able to change positioning or look at positioning or do it
0:48:22 on their own. They could try, but it won’t stick because sales won’t believe in it. The CEO won’t
0:48:28 believe in it. What we actually need is a cross functional team to get together and look at it,
0:48:32 make some decisions, get everybody in agreement and alignment on it, and then we can all go execute
0:48:39 on it in our respective departments. And then marketing can be the steward of here’s the positioning,
0:48:44 here’s how we define it. This is the messaging that comes out of that positioning. And then marketing
0:48:48 be the person that put their hand up and say, you know what, this big acquisition just happened in
0:48:52 our market and we might need to step back and relook at the positioning. It’s interesting that
0:48:57 you say that when you’re talking about a salesperson and the first call, I was thinking, oh,
0:49:03 look, if things don’t go as planned, the salesperson points to marketing, marketing points to the sales
0:49:09 person, everybody points to product. But you even expanded this. You have a cross functional team of
0:49:14 sales, marketing, products, customer success, support, and then you have the CEO involvement
0:49:19 at some point in there too. Exactly. And when things are going well, everybody is a winner and
0:49:25 everybody’s responsible for success. But the minute you have a problem, everybody starts pointing
0:49:31 the finger at everybody else. How do you determine when that’s a positioning problem versus a larger
0:49:37 problem? It’s interesting because, you know, I do this as work as a consultant and sometimes
0:49:42 companies will call me and they think they have a positioning problem and then I have a conversation
0:49:45 with them and I’m like, I don’t actually think that’s a positioning problem because there’s lots
0:49:50 of reasons businesses aren’t successful and positioning is just one of them. So typically,
0:49:57 so sometimes companies will come to me and they’ll say, you know what, every company we talk to
0:50:03 loves us. If we can get them in a meeting, we close all that business. That tells me the positioning
0:50:08 is good. You’re just not getting enough meetings. You’re just doing a terrible job at lead generation.
0:50:14 You should go fix that. You just need to get more at bats. Sometimes what you have is a sales
0:50:19 execution problem. Like there’s something in the way you’re executing in sales that isn’t working.
0:50:25 So my test is often like, so first of all, do you have good, happy customers that stick with you
0:50:29 and love you and are referenceable and whatever? Most of the companies that come to me and say,
0:50:38 yes, yes, we have that. Okay. Do you have confusion at the beginning of your sales process where they
0:50:46 come in and they just don’t get it? That gap between what a customer knows and what a prospect knows,
0:50:51 we can close that gap with good positioning. What role does storytelling play in all of this?
0:50:58 Storytelling is one of these things marketers think a lot about storytelling and obsess a lot
0:51:05 about storytelling, particularly on the consumer side, business to business marketers like to
0:51:09 think about storytelling. I don’t think a lot of B2B companies are doing an amazing job at
0:51:13 storytelling. What’s really funny about that is if you go over to sales, sales doesn’t care about
0:51:18 storytelling. They never talk about storytelling. And yet they’re the ones that actually are face
0:51:22 to face with a customer. And if anyone should be telling a story, maybe it’s your sales team.
0:51:28 Most of the storytelling stuff that you see, or at least what I learned as a marketer going through,
0:51:32 if you go to marketing school and learn storytelling, a lot of what you’ll see is this
0:51:38 hero’s journey structure for storytelling, which is very common in entertainment. It’s the way most
0:51:44 movies are written, a lot of stories are written with this hero’s journey. So in B2B storytelling,
0:51:50 we think about the hero as the customer. So the customer has a problem they embark on this quest,
0:51:55 they meet a guide, that’s us, we’re the guide, and we give them a plan and we help them be successful
0:52:02 and avoid defeat as we have this hero’s journey. The problem with that storytelling arc is there’s
0:52:09 kind of no competitor in there. And if we think about what a buyer is actually trying to figure
0:52:15 out is why pick you over the other guys, a hero’s journey doesn’t really give us an arc to do that.
0:52:21 In the work that I do with customers, we start with positioning. So we get really clear on
0:52:26 what’s the value we can deliver that no one else can, who are the customers that really care about
0:52:34 that. And then we want to build a story around that. The story that we’re trying to tell needs
0:52:39 to answer this question, why pick us over the other guys. So in that storytelling framework,
0:52:45 we need to have a spot in that framework to paint a picture of the whole market and then show where
0:52:50 we fit and where everybody fits. So we shouldn’t actually be just talking about us, we should be
0:52:55 talking about the alternative approaches to the problem, which means we’re going to talk about
0:53:02 competitors, or at least the approach that the competitors take. In the work I do, we take the
0:53:09 positioning, we translate it into a sales pitch. That sales pitch has a storytelling structure
0:53:16 that starts with a conversation around the market. So we’ll talk about, look,
0:53:23 we look at this market in a different way than our competitors. And because we look at it in a
0:53:29 different way, we built the product in a different way. And you’re a customer, you have lots of
0:53:33 choices. There’s other products that you could buy. There’s other approaches you could take to this
0:53:37 problem. Let’s talk about that. We think about this all day. We have opinions about it. We want to
0:53:42 hear what you have to say about it too. So this is the way we look at it. You could do it this way,
0:53:46 this way, or this way. And here’s the pluses and minuses of these different ways of solving this
0:53:51 problem. And this is a conversation with the customer more than me telling the customer stuff.
0:53:58 But at the same time, I’m teaching the customer about what we think is important in a purchase
0:54:04 decision, which most customers don’t know early in their purchase process. They’re trying to buy
0:54:09 accounting software. Half the people doing a purchase in B2B have never purchased a product
0:54:15 like yours before. So they’re doing this for the first time. They’re overwhelmed with information
0:54:20 on the internet. Every vendor says, we’re the best. No, we’re the best. No, we’re the best.
0:54:24 What we need to do in a good sales storytelling in B2B
0:54:32 is help customers understand how to confidently make a decision. In order to do that, I have to
0:54:38 paint a picture of the whole market so they feel good that they understand, ah, if I choose this,
0:54:45 I’m choosing to go big on this and low on this. If I choose this, here are the trade-offs for this.
0:54:49 If I choose this, here are the trade-offs for this. Or you could choose us and here’s the trade-offs
0:54:55 for us. Are we a good fit for you or not? That’s what we should be doing in a good sales storytelling,
0:55:01 in my opinion. And who does that really well, in your opinion? I have a bunch of clients that I’ve
0:55:06 worked with, but one that I think is doing an amazing job of this for a really technical,
0:55:13 complicated product is a company I worked with in San Francisco called Postman. Postman does
0:55:24 essentially a platform for developing APIs. This is a new concept. Nobody had this idea of a
0:55:31 platform for APIs before Postman came up with it. They do an amazing job, I think, of talking about
0:55:38 why APIs are important, so important that you actually don’t want a set of disjointed tools
0:55:44 across your organization to work on them, why that’s important. They’ve coined a concept called
0:55:49 an API First World, and then they’ve done an amazing job of storytelling around that.
0:55:52 So if you go on their website, on their homepage, and you scroll down about halfway,
0:56:02 they have a graphic novel called The API First World, and it’s a graphic novel designed for
0:56:10 technical people to understand this story of, what’s an API? Why is it important? Why do we
0:56:15 really want to have high quality APIs? Why is that important for your business? And why do we need
0:56:20 a platform to enable that? So I think they do an incredible job of that. And they do it in a
0:56:27 thousand different ways. Like if you see the CEO do a conference talk, he’s actually not talking
0:56:33 about the product as much as he is talking about the market and this concept and why we need to
0:56:39 think about APIs differently. But if you are aligned with his point of view on the market,
0:56:44 you’re going to buy this product. But they’ve really done a good job, I think, of developing a
0:56:50 point of view on the market, helping customers understand the context around their product
0:56:56 and the things that you need to understand in order to understand why their product is valuable
0:57:01 and why you might pick it. How important is that from a CEO perspective at conferences and talks
0:57:07 and media to basically put yourself out there and say, I see the world this way, which is slightly
0:57:12 different than most people see it. I think it’s super important. I think this concept of having
0:57:18 a point of view on the market is really, really important. Most founders that I’ve worked with,
0:57:25 if you talk about how the original idea for the product came up, they’ll say, you know, I was
0:57:30 really frustrated. I looked at all the databases and I decided all the databases were doing it wrong.
0:57:35 And if you were smart and you knew what I knew, I had a better way to do it. Yeah, you would build
0:57:41 a database like this. Part of what we need to communicate to customers is we kind of need to
0:57:48 take them on that journey and say, look, we have a different perspective on this. We look at this
0:57:55 problem different. It’s not the problem. We see a problem inside the problem. We have a perspective
0:58:00 on the problem that if you understood it the way we understood it, you would pick our stuff.
0:58:06 Right. So that point of view I think is really super important. And if you can nail that,
0:58:11 it is the key to selling lots of stuff. And how important is it to, you mentioned coin the term,
0:58:17 like how important is it to define the vocabulary by which the customers use ultimately
0:58:23 to make a choice or to own a term so that if it becomes top of mind to them,
0:58:29 nobody else has that term. It’s really important if you are doing something that is truly
0:58:37 innovative, like an emerging thing. So earlier we talked about market categories and most of the
0:58:43 time, if you look at the way the most successful companies do this, they’re going into an existing
0:58:47 market category and they’re serving an underserved corner of that and they’re expanding from that.
0:58:53 About 10% of the time that’s not true. 10% of the time we have something that is emerging.
0:58:57 It’s a market that is emerging. There is no leader in that market right now because that
0:59:02 market doesn’t even exist right now. This is something brand new. You could never even do this
0:59:09 before because technology wouldn’t, wasn’t there to do it. And so it’s emerging. When it’s emerging,
0:59:16 there’s no good vocabulary to talk about it because we’ve never talked about it before.
0:59:24 And often in those cases, what we’re doing is we’re defining or attempting to define
0:59:29 what the boundaries of that emerging market category are. What’s important and what isn’t
0:59:36 important in that emerging market category. And in those cases, we often very much do want to put
0:59:43 some names on things. We may want to specifically name the market category in a way that advantages
0:59:50 us. We may want to name key concepts inside that in a way that helps customers understand
0:59:58 why this is an important key thing that you need to understand in that. And so if you see companies
1:00:07 that have truly done category creation, often they’ve done a very good job of helping customers
1:00:13 understand key things that they needed to understand in order to understand, ah, this is a totally
1:00:19 different problem. I didn’t even know I had this problem. Because if the customer knew there was
1:00:24 a problem and they have that problem, there would be a category of solutions to solve it already.
1:00:28 In emerging markets, we’re often addressing a problem that the customer doesn’t even define it
1:00:32 as a problem. They don’t even know this is a problem. This is just the way the world works.
1:00:36 There’s no way to solve this problem. If we can help them become problem aware,
1:00:42 then, you know, that’s a step closer to that, well, you know, now that you know that you have a
1:00:47 problem, we’re the thing to solve that. How do you think about independent bodies that play a
1:00:53 role? And I’m thinking like in cybersecurity, there’s the Gartner Quadrant. And if you’re not
1:00:58 on there, like people won’t even consider your product, but that sort of limits your ability
1:01:04 to. Absolutely. How do you think about that? I spent a lot of time working with Gartner in my
1:01:14 past roles as a VP marketing. Not every market segment has an analyst or an expert body or
1:01:19 somebody whose opinion matters a lot, but in some segments we do. So I spent a lot of time in the
1:01:25 database market. No large enterprise buys a database without talking to Gartner Group first.
1:01:32 So in that case, we spent a lot of time helping Gartner Group understand what our stuff was about,
1:01:38 why it was important, why they should include us in the quadrant, because we literally needed them
1:01:45 to position us properly to clients that call them and ask for advice. I’ve had other markets that
1:01:50 I’ve been in where the buyers simply don’t call Gartner Group because they don’t care what Gartner
1:01:54 Group has to say about that because Gartner Group doesn’t cover that space. And Gartner Group does
1:02:00 a really good job in enterprise IT. Outside of enterprise IT, they’re a bit less influential.
1:02:08 I think it’s important if we’re a vendor to understand where do our customers look for advice
1:02:14 and where do we need to educate those people or those entities because they’re giving advice
1:02:21 to our customers. Sometimes that’s industry analysts like Gartner. Sometimes it’s service
1:02:26 providers or system integrators like Deloitte and they’ll go to Deloitte and say, “What do
1:02:30 you think about this? We’re doing a big digital transformation. You’re our trusted advisor on
1:02:34 digital transformation. What do you think about these products?” In which case, maybe I need a
1:02:38 partnership with Deloitte because they’re not going to recommend my stuff if they don’t get some kind
1:02:45 of money off of that. So it’s important to understand who influences your buyer. As we go
1:02:53 down market, it’s interesting. There’ll be people like you, like podcasters that people listen to,
1:02:59 people that are experts in things. People ask me my advice about marketing technology all the
1:03:06 time. So in a small way, I’m an influencer there. In the work that I do, companies will often ask
1:03:10 me, “Well, we now need to do all these things in sales. Who do you know that’s really good in
1:03:14 sales? Is there particular technology you should recommend in sales?” The important part as vendors,
1:03:19 I think, is we need to understand who has influence on our buyers and do we need to invest
1:03:24 some energy and attention in making sure that those influencers understand our stuff and our
1:03:29 positioning us well. What are the most interesting mistakes you’ve seen people make when it comes
1:03:35 to positioning? So many things. The first mistake is not thinking about it at all and just assuming
1:03:42 that there’s only one position we could possibly take. Most products, we could position them in a
1:03:48 dozen different markets. And if we really step back and forgot about the history and where we
1:03:54 came from and looked at it with our fresh eyes, we might see something really different. So
1:03:58 we need to think about this in a way customer thinks about it. So not thinking about positioning
1:04:03 at all is the first mistake. The second mistake is, as we talked about before, treating it as a
1:04:09 little marketing exercise. We’re just going to put some new words on the homepage and that’s it,
1:04:14 we’re done. But sales has no idea how to pitch it. Product doesn’t really understand it. It doesn’t
1:04:21 actually represent the truth of our product at all. It’s just nice, pretty words. This is not
1:04:27 repositioning. This isn’t going to move the dial on anything. And then lately, what I’ve seen is
1:04:41 companies that love the idea of category creation are attempting to create a category when they
1:04:47 obviously fit in an existing market category. And it’s kind of wishful thinking that this is a
1:04:52 new category. So they say, no, no, no, we don’t have any competition. This is a brand new thing.
1:04:57 Nobody works like this. And the result is the customer is like, but wait, aren’t you just a CRM?
1:05:03 Why are you using all these other words? I’m just confused. So I’ve seen a lot of companies have come
1:05:09 to me that have attempted to do category creation or pretend that they’re doing this new category
1:05:15 of things. And then it’s been a disaster. Customers are just very confused. They don’t understand why
1:05:20 this is different from the existing things they’re doing. They can’t figure out what bucket to put
1:05:25 it in because they’re trying to create a new bucket. And it’s been a disaster. And then they come
1:05:30 to me and they’re like, now we got to fix this. And how do we do it? When there’s an obvious spot
1:05:37 where they could easily position in a very big sub-segment of an existing market category,
1:05:42 and that would be way easier to sell, way easier to tell the story, way easier to do deals. So I
1:05:49 see a lot of that right now. What’s the difference or maybe what does schools get wrong about B2B
1:05:55 marketing that when you in the academic environment, that sounds good. But in the real world, it falls
1:06:01 flat. Oh my gosh, so much stuff. Most of the research that’s been done in marketing, like when
1:06:06 I went to marketing school, it was so disappointing. All of the research is done on consumer packaged
1:06:15 goods, all of it. And often what you’ll get is a professor inside a marketing department at a
1:06:21 university taking these things that we’ve learned about consumer packaged goods and then stretching
1:06:26 it out and saying, well, obviously this works with B2B exactly the same way. And it’s like, well,
1:06:33 wait a second. So we’ll see things like, I must have this conversation about once a week where
1:06:40 people will talk about, what’s that water, liquid death? You know this one? I don’t drink that.
1:06:45 The marketers are marketers obsessed with this thing called liquid death. And all it is is fizzy
1:06:50 water in a can made to look cool. And they sell it at bars. So you don’t want to consume alcohol.
1:06:55 You’re not into booze. You go to the bar, you still want to look cool. You can order this liquid
1:06:58 death. It’s got skulls on it and stuff. They do all this really creative advertising and all this
1:07:04 stuff. And the B2B marketers look at that and say, why can’t we do that? Right? Why can’t this
1:07:09 just be marketing? Why do we have to worry about product at all? And often you’ll get these marketers
1:07:14 say, look, can we really differentiate on product? Because people can just copy our product.
1:07:20 Eventually everyone will just catch up to us and all the products will be exactly the same.
1:07:27 And if you’re in tech, that is nonsense. That is nonsense. That would be like saying,
1:07:33 you don’t think any of the innovation that Apple’s done matters. They could have just,
1:07:39 it’s just marketing. Do you really think that? So there is kind of this belief that we can take
1:07:46 these things from consumer and apply it to a very considered purchase in a B2B situation
1:07:52 where there are stakes involved, where the person making the decision might get fired
1:07:57 and say, oh yeah, that’s just like buying fizzy water. Oh, at the end of the day, these people are
1:08:03 all people and they’re driven by emotions. We have to connect with their emotions. I agree with that,
1:08:10 but the emotion is fear. It’s not looking cool. It’s not, hey, I like the one with the skulls.
1:08:16 I can’t go to my boss and say, I bought the database with the skulls, man, come on.
1:08:24 I just can’t get away with that. And so I’ve heard a lot of things in marketing classes
1:08:31 where I’ve leaned back and said, okay, man, if we’re selling toothpaste, fine. But if I’m selling
1:08:38 a million dollars worth of middleware, not fine. These rules do not apply. So I think in schools,
1:08:43 we don’t teach enough about B2B. We don’t teach enough about the difference between
1:08:48 a highly considered purchase versus an unconsidered purchase. I don’t think we talk enough about
1:08:54 buying committees. I don’t think we look enough at the research around how difficult it is to get
1:09:01 over indecision in a B2B purchase process and what that means for our positioning, for the way that
1:09:07 we do sales pitches, for a lot of the stuff we do. So I don’t see that covered enough in schools
1:09:15 at all. Every great B2B marketer I know has learned this on the ground, hands on, doing it in companies.
1:09:20 We’re all starting from scratch. What do you know about B2B decision making that you would say most
1:09:29 people get wrong? The biggest one is this idea of customer indecision, that people do not understand
1:09:36 how difficult it is to make a purchase. If you understood the research on that, it’s amazing
1:09:41 anything gets bought at all. There’s a great book out there. It’s by this guy, Matt Dixon.
1:09:47 It’s called The Jewel to Effect. And the research in that is incredible. So when we went into lockdown
1:09:53 in COVID, he took this opportunity to study sales calls because all of a sudden all the
1:09:59 sales calls were happening virtually, everybody was doing them on Zoom. And so they took some AI
1:10:06 and they analyzed two and a half million sales calls. And they did it in partnership with these
1:10:11 companies so that they could look at what happened on the sales call. And then what ultimately
1:10:15 happened? Did we get the deal? Did we not get the deal? What works and what doesn’t work? And
1:10:22 that research is terrifying when you look at it like that’s where this number comes from.
1:10:30 40 to 60% of B2B purchase processes end in no decision. This is the most fearsome competitor.
1:10:37 We have a B2B by far is no decision. And this no decision is not because we’ve made a decision
1:10:41 to stay with the thing we have because we think it’s better. It’s because we look at our choices.
1:10:46 We can’t figure out how to do that in a way that we’re sure isn’t going to get us into trouble.
1:10:51 So we just don’t do anything. If we really understood that, I think we would operate very
1:10:56 differently in B2B. You can see the difference in people that get that and people that don’t.
1:11:02 That’s fascinating. I think it’s really interesting to sort of think of sales cycles. I like the fear
1:11:08 concept. My friend who runs a cybersecurity company, I was like, “Oh, put me in charge of sales.”
1:11:11 He’s like, “What would you do?” I was like, “I would show up with a binder of newspaper
1:11:17 clipping so that companies that got hacked would be like, “My job is that you don’t appear in this
1:11:21 book.” And that would be my entire sale. They don’t care about the technical features. They’re not
1:11:26 buying features. They’re buying the benefit. And when you’re selling something negative,
1:11:31 which doesn’t contribute to revenue directly, you’re basically selling the prevention of
1:11:36 something negative from happening. How do you do that? I was like, “Why wouldn’t that be effective?
1:11:41 I don’t know.” This has been a fascinating conversation. We always end with sort of the
1:11:50 same question, which is, “What is success for you in life?” I feel like I spent my whole career
1:11:56 being a vice president of marketing. I did that for 25, 30 years. And the thing about being a vice
1:12:00 president of marketing, it’s a really hard job. You have to know a lot about a lot of things.
1:12:06 Marketers talk about being T-shaped. You have to know you have to be this deep on so many things,
1:12:10 and then usually you have one thing that you’re really deep on. For most of my career,
1:12:15 I was a T-shaped marketer, and the thing I was really deep on was positioning.
1:12:22 Now I’m a consultant, and I just get to do that thing that I love. And so that has been
1:12:30 such satisfying work. It’s been so satisfying to work with companies, wrestle this thing that is
1:12:39 really thorny, really hard. And when it clicks, it feels like magic. It feels like magic. Good
1:12:44 positioning. When you look at it afterwards, people will say, “Well, of course that’s what
1:12:48 they are. Of course that’s what they do.” And they’re like, “Actually, that was really hard
1:12:52 for us to get there. And if you had asked us two years ago, we had no idea what that is. And now
1:12:57 it’s this and it seems obvious, but it wasn’t obvious.” That is very satisfying work to do.
1:13:04 So I just feel that is success for me. When we get to the end of these projects, and everybody
1:13:09 in the room is like, “This is so much easier to sell. This is so much easier for customers to
1:13:15 understand.” I had a client come to me two weeks ago, and they’re doing the first roll out of these
1:13:20 new sales pitches that they’re doing. And so the first pitch that they did, and they were very
1:13:24 scared to do it because it was a brand new pitch, and it was a really high-profile client,
1:13:30 really big deal, they went in, and it’s a competitive deal. So they know that the prospect
1:13:35 is talk to their two competitors, and then they’re coming to talk to them. And the CEO sent me an
1:13:43 email and said, “After we did the pitch, the prospect CEO pulled them aside and said, “I have
1:13:48 never seen a sales pitch as good at that in my entire life.” We’ve seen a lot of sales pitches.
1:13:54 That was really great. That’s awesome. And so that is the most satisfying thing. And so he’s happy.
1:14:00 I’m happy. Everyone’s happy. You also hit on something in that answer that I think goes
1:14:06 under “appreciated in life,” which is avoiding your weaknesses. So doing the thing that you’re
1:14:11 really good at in structuring your life in a way where you’re not. You’re doing a lot of the things
1:14:15 that you either don’t want to be doing or that you’re not as good at. It’s so amazing. I wish I
1:14:21 had been doing it sooner in my career, although I don’t know if I’d be good at this, if I didn’t have
1:14:27 25, 30 years of being a hands-on vice president of marketing. But this does feel like the reward
1:14:33 phase of my career that I just get to work in my little zone of excellence doing this thing that
1:14:38 has really big impact on companies. I love it. They love it. I’m happy. They’re happy. Everybody’s
1:14:43 happy. If this is all I do for the rest of my life, perfect.
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