Episode Transcript
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Brian: Hey, everyone. And welcome to Bright & Early, the podcast for people building early-stage startups. I am your host, Brian Rhea. I talk to entrepreneurs, product people, designers, and marketing pros to learn what works, what doesn’t, and why. Giving you at least one thing to apply to your business, first thing tomorrow.
My guest today is April Dunford. April is the author of “Obviously Awesome: How To Nail Product Positioning So Customers Get it, Buy It, and Love It”.
he is a positioning consultant, entrepreneur, board member, angel investor, and advisor. April was an executive at seven successful tech startups and three global tech giants, where she launched 16 products along the way. April, welcome to Bright & Early.
April: Hey, thanks so much for having me. It’s great to be here.
Brian: It’s good to have you on. We were just talking offline a second ago, that you have had quite the whirlwind of a year touring and supporting this book.
April: Yeah.
Brian: So, what’s it been like [crosstalk: 00:01:09]?
[00:01:09]
April: It’s been too much of April sitting in airports, that’s what it’s been. No, it’s been fun. You know, I was saying earlier that I decided one of the things I was going to do to support the book was to do a lot of public speaking. And so, I basically said, “Anybody this year, if you asked me to speak at your conference, and I can make it work on the calendar, I am going to go do it.”
And, at the beginning of the year, I didn’t have that many things but, then, as the year went on, it kind of snowballed. And, I’ll finish up this year doing more than 40 talks, which, to me, feels like a lot.
Brian: It’s a bunch.
April: And it’s all over the world, too. I have been all over Europe. I am in South America next week. I have been all over the United States and Canada.
It’s been pretty fun, but it’s also been a little exhausting, yeah. I am kind of looking forward to next year, where I get to go back to a little bit less travel and more just working with clients and less flogging a book.
Brian: Well, so I can speak for myself, it doesn’t surprise me that once the book got out and people started talking about it, that it caught on. Because, as a business book, it is exactly as long as it needs to be. [laughter]
[00:02:26] April: I am glad you appreciate that. [crosstalk: 00:02:27] I worked hard at that. I am telling you, the original manuscript for that book was way longer, like, maybe three times longer. And I treated writing this book a bit like launching a product. So, I went and did customer discovery interviews. And so, I said, “This is a– I am writing this book, who is my audience?” And I decided the main audience that I was trying to get to were startup founders. So, I went and talked to 50 startup founders and I quizzed them about books and reading. And I said, “Hey, what kind of books have you read in the last couple of years? And what did you like about them? And where do you read? And how did you read?” And things like that.
And here is what I learned, startup founders want to read. They like to read. They hear about books all of the time. They make lists of books they are going to read. [laughter] And then they pick a couple of them, they load them on their Kindle. They get on a long flight going somewhere, they get exactly halfway through a book, and then they never finish it.
And so, yeah, I decided that my book was going to be– I like the way you put it, like, exactly as long as it needs to be and not a word longer. So, no fluff, no filler, no repeating the thing 19 times, so you get it. It’s going to be exactly as long as it needs to be. And it’s designed so that if you’re in North America and you’re on a cross-country flight, you should be able to sit down and finish it [laughter] before you hit the ground on the other side. And that was a bit of a risk because people kept telling me it’s not long enough, and it needs to be so many words.
Brian: [crosstalk: 00:04:11] Like, is your publisher telling you that it wasn’t long enough? Or–
[00:04:15]
April: Well, so, that’s a whole other thing. So, I ended up self-publishing but I worked with– I talked to a bunch of different publishers and, yeah, the publishers have a real idea of how long a book should be. Even though I self-published, I worked with some folks that helped me with that and they all come from traditional publishing. And they were also a little worried that the book was way too short, and “I don’t know if it’s going to be long enough.” And a lot of this comes from the book is supposed to sit on a shelf and the spine needs to be a certain width to put the title on it. I was like, “My dudes, nobody is buying my book that way - like nobody. Zero people will buy it that way.”
So, I think there is a lot of, like all industries, I think there’s some kind of things that are taken as a given that deserve to be challenged. And the length of the book and the way a book is structured, I think, is one of those things. So, I spent a lot of time trying to make the book easy to consume, trying to make it skimmable. Trying to make it exactly as long as it needs to be with all of the meat there and without a lot of filler because my people are really, really busy.
Brian: No, it’s really good. You do the thing where you lay out the steps. You give some supporting use cases, but without it being like a full chapter of case studies, like, I loved it.
April: Thank you.
Brian: So, how did the idea for the book initially begin to form in your mind? When did you have the first thought of, “I think I might have a book here”?
[00:05:49]
April: Yeah. So, this book has been a really long time coming. So, I originally started thinking about positioning– My thinking about positioning goes all the way back to the beginning of my career in tech, which is like 25, 30 years ago. But I started thinking deeply about positioning once I got to startup number three and I started to realize, “Man, every time I come in to a startup to run marketing; the first thing we end up doing is monkeying around with the positioning.”
And I have a degree in Engineering, so I am a bit of a self-taught marketer. But I read a lot of books, I took a lot of courses and there didn’t seem to be a lot of good stuff written about positioning. There’s a book that everyone reads, if you go to marketing school, it’s called “Positioning: The Battle For Your Mind” by these guys, Ries and Trout. And it’s a great book, I highly recommend it. And what they do is they define what positioning is, but they don’t give you any clues how to do it. So, the idea is you are supposed to call them and they were going to do it for you because they were an agency.
And that frustrated the heck out of me because I was working at this dinky little startup. We had no budget. We are not going to hire those guys - they work with Coke. [laughter] And so, we were like, “All right, I am not gonna hire them. But so, how do I actually do this?” And I sat across from all of the smart marketing people I know having coffee, saying, “How do you guys do positioning?” Like, I am doing this in every company and I am not the only person that’s asked this question. And everybody seemed to be kind of making it up as they went along, just like I was. And I thought that was crazy.
And so, I started thinking about, “Well, there must be a methodology to do this.” And, eventually, I pieced together one that I was using myself. And then somebody asked me to go to a startup accelerator and teach a class on positioning. And then you have this terrible thing that happens where you think you have got total mastery over the subject. And then you stand in front of a room full of people that know nothing about it and you try to teach it for two hours. And, at the end, they are all like, “So, what’s positioning again?” [laughter] And you are like, “Oh, I failed.” So, that took me a while to figure that out. But then, so, first, I had to figure out the methodology, then I had to figure out how to teach it. And then once I got comfortable teaching it, it was around that time that I switched to doing consulting work instead of being in-house as the VP of Marketing.
And so, while I’m doing consulting work, I would have people come to me that I just couldn’t help. Some of them were really early-stage companies and with no revenue, and they’re bootstrapping and they can’t hire a consultant. They can’t buy coffee. [laughter] And so, those folks, I would be trying to help them by sitting over coffee meetings but there is only so far I could get with them. And I kept thinking, “God, I wish I just had this all written down. And I could just slide across the table and say, “Here is the manual. Come back when you’re done.” And so, and then, eventually, I got the idea, “Well, I should just write this all down in a book.” And then, that’s how I would help folks like that or folks that–
You know, I get calls from places– Like, last week, I was talking to this company in Malaysia. And they are amazing but they can’t afford to fly me out to Malaysia to do this consulting work for them. So, again, the book is a way that folks can teach themselves. And at least they’ve got something to go on, even if they can’t hire me directly as a consultant to help them. So, that’s where it came from. But it’s been a long road, like, years, decades actually.
Brian: Yeah. So, you lay out in the book The 10-step Positioning Process, just like this methodology that you’re referring to. So, in the book, first, you say that you need to understand what positioning is and how important context setting is for strong positioning. And so, I want to dig into that specifically. On Page 20, you say, “When customers encounter a product that they have never seen before, they look for contextual clues to help them figure out what it is.” So, that makes sense initially. Or it just makes sense - period. So, can you talk a bit about context setting, and how it’s done well, versus how it can be done wrong?
[00:10:20]
April: Yeah. So, when I first started talking to people about positioning, I’d have this problem, in that, nobody knows what positioning is, so– Or worse, they think they know what it is and then their thought on it is muddy. And so, I used to have to always start by defining what positioning is. And so, I’d say, “Look, here is what positioning is. Positioning defines how your product is the best in the world at delivering something that a well-defined set of customers cares a lot about.” That’s a lot of stuff to unpack. [laughter] That, it includes who is my competitor? What’s my secret sauce? What’s the value of that to customers? Who are the customers I am trying to get to and what’s the market category? That’s a lot of stuff to unpack.
So, if I am talking to a founder that doesn’t have a marketing background, and most founders don’t; I would have to use analogies and other things to sort of get it across. And so, one of the things that I settled on that works really well is a good way to think about positioning is it’s a bit like context setting for products. So, if you look on the research of this stuff, if customers encounter a product they know nothing about, they do kind of try to figure out what it’s all about by looking at its context. And, specifically, for products in a market, they will pay attention to the words you use around it, particularly related to market category.
So, if I say to you, “I have got a product, and it’s really amazing, and it’s a CRM.” And that’s all I tell you, that’s it market category, CRM. I guarantee you, you made a whole bunch of assumptions about that product and I didn’t tell you a single feature, not a single thing about it. So, who is my competitor?
Brian: Salesforce.
April: Salesforce, right. Name me two or three features that I would probably have.
Brian: I’ll be able to add some contacts to it, and then notes, and activities on that contact.
[00:12:26]
April: Exactly. Now, here is where it gets really interesting. So, I can do things like, what’s the title of the person that buys my product? Probably Sales Manager, right, Vice President of Sales. How about this; what’s my price? And I didn’t tell you anything. I didn’t tell you the pricing. I didn’t tell you anything. But I bet you, if I tried to tell you my price was more than Salesforce, who is the leader in that market category, you’d be like, “Whoa, that sounds expensive.” [laughter] So, I set all of these expectations in your mind just by saying, “My thing is a CRM.” And it would be the same thing if I said, “My thing is email,” a totally different set of assumptions, different competitors, different price point, different features, different everything.
Now, so, here is how it works. If I do a good job and I position my product in a market category and the assumptions that it triggers about my product are all true. Great, I just saved my sales and marketing teams a lot of work. I don’t have to tell you who my competitor is, it’s assumed. I don’t have to list every single feature, half of that stuff is table stakes.
However, it works the same way if you do a bad job of it. So, if I position myself in a market category, it triggers a bunch of assumptions about my product that are not true. Then, my sales and marketing team is going to have to make a significant effort to undo the damage that my positioning has already done.
So, and most of the time, we pick market category without even thinking about it. It’s, literally, like a default. We’ll say, “Well, you know, I woke up in the morning, the founder decided he was going to build a new kind of jazzy email.” And, three years later, we’ve got a product in the market that does a whole bunch of stuff. We’ve got all kinds of things around the email space, and some of it’s chat, and some of it is team collaboration, and all sorts of other things. And you’re still calling this thing email. Is it really an email? Is it? Because if you don’t compete with Gmail and Outlook, maybe you’re not email. If your key features don’t look like email, maybe you’re not email.
So, a lot of times, companies, they don’t understand position because they have never done it deliberately. They have just kind of said, “Well, we’re email. What else could we be?” And the reality is every product on the planet, I could position it in a handful of different markets and you would think very different things about it, depending on how I positioned it.
Brian: And so, the reason that that’s important, you touched on, is that you want to– That people are going to make those assumptions, whether you want them to or not.
April: That’s right.
Brian: And so, as founders and entrepreneurs, we need to be very deliberate about the category and that we get the context that we get set into, [crosstalk: 00:15:16] we need to be deliberate about doing it.
[00:15:22]
April: Yeah. So, I can give you an example. So, I had this– And this what I use, I have been using this in my talks recently because it’s a good one. So, I had this company, and they called me and they said, “Well, we built this thing. We’re ex-lawyers, and we got this idea for a product for lawyers.” And what the thing is it’s email for lawyers. And then they jumped into the demo, and they start showing me the demo for this thing. And it’s cool, it’s got kind of an inbox and stuff. And, at some point, I interrupt the guy and I said, “Hey, how does the calendar on this email [inaudible: 00:15:57]?” And the guy says, “Oh, we don’t have a calendar.”
And I am like, “What? [laughter] How? What? How do you replace Gmail and Outlook if you don’t have a calendar?” And he said, “Oh, we don’t replace them. We don’t actually compete with Gmail and Outlook.” And I am like, “How can you be email and not compete with them [inaudible: 00:16:12],” okay. And then I was like, “Okay, back up. So, you have got all kinds of happy customers. Why do people love you so much?” And the guy says, “Well, we have got this patented thing, it’s this feature. And what it is, is we call it,” they had some name for it, but it was like super-secure context-aware file sharing.
So, you have lawyers, and they are collaborating with clients and they need to share documents. This thing looks at the documents and it looks at the history of communication and it does some fancy AI stuff or whatever. And it figures out who needs to have access to those documents. And it automatically gives you access, in a super-secure way, so that only the people who are allowed to have access to the documents can have them. And it actually sounds really, really cool, and it solves a big problem for lawyers, but it is not email.
If I wanted to solve that problem, and how do I collaborate on a document in a secure way? Would I buy an email? Would I look for email to solve that problem? No, I wouldn’t. So, what I have got is this really, really cool product masquerading as crappy email. [laughter] So, now, imagine I take that same product, the exact same product, and I pick it up and I plunk it down. I haven’t touched features, functions, nothing. I am just going to recontextualize it and stick it in a different context. Let’s call it “Team collaboration for lawyers”. Well, okay, if I walk in and say, “Hey, I have got this thing, it’s team collaboration for lawyers.” Now, my competition is Slack-ish, right. And then, that’s better in a lot of ways.
Slack doesn’t do anything in particular for lawyers, so you must have something, some collaboration stuff specific for lawyers. And, “Oh, that’s exactly what we have, our secret sauce feature.” It fits right in the middle of the context of team collaboration. Of course, you have got a super-secure and context-aware file sharing thing. It makes sense, right. I know who it’s for, it’s for lawyers.
And, then the other cool thing is when you look at stuff like pricing; the terrible thing about being positioned in the email space is everybody assumes your pricing is really, really cheap, like free, basically. But if you say it’s team collaboration, the expectation is, “Oh, I am going to pay some money for that.” And so, it changed the pricing on that [thing 00:18:27].
My joke that I tell when I talk about that story is that while we were talking on the phone about pricing, me and the guys on this team. I was like, “Theoretically, you could say we have got a really special thing, like special team collaboration that does something over and above just for lawyers. So, you could, theoretically, charge more than Slack maybe by saying, “We have this special thing.” And then I said, “Ooh, you could like get the lawyers on the phone and then you tell them look, “We have got special, special pricing just for the lawyers. So, what we decided is, we are just going to price it by the minute.” And then just wait until the lawyers complained and go, “That’s not fair.” And you say, “Yeah, I know.” [laughter] Anyways, they didn’t do that. But I was joking, but kind of not joking. Part of me was like, “What would the lawyers say?”
But anyways. But that’s the thing, I can have a product that is actually really innovative, really great, really valuable, really differentiated. But if I have got it sitting in the wrong context, people can, literally, miss all of that good stuff and say, “Ugh, you don’t have a calendar - you suck.” [laughter]
[00:19:43]
Brian: That’s a great example that makes immediate sense, like the value perception between email for lawyers versus secure team collaboration for lawyers. I’ll pay for security. Email, that just better be fast, free, and always up.
April: Exactly, I don’t have a problem with email, man. I think if you went to the lawyers and say, “Do you want a new email?” They’d be like, “No.”
Brian: Yeah. The other thing you do, in the book, you have some fun at the expense of the traditional positioning statement of, “For people who __”.
April: Yeah, I hate that thing.
Brian: Yeah, so like one example, like, “For people who like to drink water, Lacroix is surprisingly delightful hydration and [crosstalk: 00:20:21]. Unlike tap water, which sucks, Lacroix doesn’t suck.” [laughter] So, you dig into that in the book. So, how does that traditional positioning statement steer people in the wrong way?
[00:20:36]
April: Well, here is the thing. The first time I really dug into the positioning statement, I learned it in a class in university. And then the university professor, so I am doing this self-study thing on marketing because I have an engineering degree and I don’t know what I am doing. So, I thought I better take some marketing classes, right. So, I am taking this class and [inaudible: 00:20:58] the prof gets up, and they have got a class on positioning. I am like, “Great, I am finally going to learn this positioning thing.” And he puts the positioning statement up there.
And if you’re unfamiliar with it, it’s like a mad libs kind of fill in the blanks sentence. And it says, “Our product is a __, that does __, unlike __.” And you right in, “This is my market category. These are my competitors. And these are my whatever.”
So, at the time I took this class, I had just repositioned a product and we had originally envisioned it as a personal use SQL database. And we repositioned it as an embeddable database for mobile devices, a pretty big shift. So, I am sitting in the class, and the guy puts up the positioning statement and he is like, “Okay, so this is what you do. You add this thing. And you take your market category and you write it in here. And you take your competitors and you write it in here, and then you’re done.”
And then he starts moving on to the next topic. And I am at the back of the class, “Going, no, no, no, wait, wait. [laughter] [inaudible: 00:21:56] stop right there.” And I put up my hand and I said, “Hey, man, I just did this thing, and we positioned it and repositioned it from this to that. And how could I have saved myself all that energy? Like, you have got a blank there that says ‘market category’, but how do I know which market category is the best one? Like, there must be a methodology for that.”
And the guy did this thing where he kind of stopped, and he had glasses on, he was an old guy. He put his glasses down his nose and he looked down his glasses at me. And he did this thing where– I said, “Well, how do you know which one is the right one? And he just looked at me and he says, “Trust me, April, you’ll just know.” [laughter]
Brian: No.
[00:22:41]
April: And I am like, “My dudes, I have a degree in Engineering, nothing in my life has worked like that up until now. I didn’t just know advanced calculus. I didn’t just know C++ programming. I didn’t just know the mechanics of deformable solids. And I am pretty sure, like I am working at a startup and half the people have a Ph.D. in Database Science and we didn’t know.” So, at that point, I decided, “Oh, no one knows, like, this is actually crap.”
And the worst part about the positioning statement is doing one, I think, is not only kind of useless, it’s actually harmful because it tricks you into thinking that you’ll just know. So, it kind of tricks you into thinking “Well, all I have got to do is fill out the blanks. And so, the right answer should be obvious, and it should be the first thing that pops into my head,” which is very often not true. So, the positioning statement, in my mind, it’s a bad one.
I did one at IBM. The first time I had to do one, professionally, I was working at IBM. And, at this point, I used to mock the positioning statement all of the time. And, at IBM, they have this really famous product release process. In fact, they teach other big companies how to do it as a consulting engagement. And so, I was releasing a new product there and I was in charge of it. So, they give me the big binder and it’s the process. And there’s a step in there called positioning. And I am “Oh, boy, we are going to see how a world-class, Fortune 500 gets this done.” And I flipped to this section and it’s, literally, like, one page and it’s a fricking positioning statement. And I was like, “I am not doing this.” [laughter]
And so, my boss came in and I was like, “Paul, I am not doing it. That’s stupid.” And I give him the whole big rant, “I am not doing it. This is a stupid thing. And this is why, and blah, blah, blah.” And my boss, he was a cool guy. My boss was like, “Uh-huh, uh-huh, yeah, mm-hmm. Yeah, you know, April, do you like working at IBM?” [laughter] And I was like, “Yeah, yes, I do. I like working at IBM very much.” And he is like, “And do you like your paycheck? Is your paycheck okay here, April?” And I was like, “Yeah, my paycheck is okay.” And he was like, “Shut up and fill out that stupid form.” So, I did it, and that’s what everyone was doing, was filling the thing in.
And so, and we filled it in. And ours was as stupid as– So, I was working on a database at the time, and it was like, “For people that buy databases, my database is a database, unlike Oracle that does other database stuff.” Like I, literally, rage filled the thing in. And we put it in the binder no one ever looked at it again. I mocked fill it out and nobody noticed, that’s how useless it was. So, even there, it wasn’t working.
So, my attempt to build a methodology around this comes out of that; that’s not a methodology for anything. It’s not even a good way to capture positioning, even if all you wanted to do is write positioning down, it doesn’t give you enough stuff on that. So, the positioning statement, in my opinion, is just [crosstalk: 00:25:40].
[00:25:43]
Brian: Is there, though, at least something to the idea that, okay, let’s assume that it can be garbage and useless. But if we’re going to say, “As an exercise, Team, let’s fill out 10 of these or even five.” And it at least makes you think about competitive alternatives, unique attributes, your market. It makes you think about your market category. Is there something to the exercise? Or would you say, “No, no, no. Take those good things about the exercise and apply them over here,” like [00:26:20]?
April: This is exactly where I got to. So, where I got to, from doing this positioning statement, and hearing about it over and over again in classes, and trying to do it at IBM. The valuable piece of the positioning statement is it identifies the component pieces of the positioning that matter. So, positioning has five component pieces. Those component pieces are, essentially, the blanks in a positioning [statement 00:26:44], right. So, we have got market category, competitive alternatives, unique capabilities, value, and who is my target customer. Those are my five pieces.
And so, the way I looked at it, is I said, “Look, the positioning statement, I don’t know where it lost its way.” But at least if I just wrote down those five blanks and said, “Look, solve for these, and you have got a good positioning.” So that’s the basis of my methodology, [it 00:27:15] comes from me thinking like that. So, I said, “Look, all I have got to do, I have got to break it into five pieces. And I am going to teach you how to solve for the pieces.” It’s the question that my professor couldn’t ask, “How do I know what the market category is?
Brian: How do I know what to put there?
[00:27:25]
April: “I don’t know, there must be– You know, let’s figure it out.” So, then, I said, “Okay, well, I can solve– Some of these are easy to solve for and some of these are hard to solve for, but I’ll figure out how to solve for the five.” And you figure out how to put them back together and, voila, perfect positioning.
Now, here is where it gets tricky. If you look at the five component pieces, and you start scratching into it, you realize that the component pieces each have a relationship to each other. And then, this is the thing that the positioning statement also does not make clear. So, let’s pick one, like, let’s pick value. The value that you can uniquely deliver to clients is completely dependent on your unique capabilities or features, right. Your unique capabilities or features are only unique when compared to a competitive alternative. So, all of those things flow from each other. My target customer segment is completely dependent on the value I could deliver. That’s how I define that. It’s the people that care the most about my value.
And then, the last piece, which is market category. Market category is another way of saying, “What is the context I can wrap around my product that makes this value obvious to these people?” So, I have got to have value and I have got to have target segments. So, if everything is related to everything else, well, where do I start? [laughter] And so, for a long time, I thought, “This is actually– There is no good place to start because everything depends on everything else.” It’s a spiral. You take a crack at one of them and you work your way through, you test it, and you see if it works, and then you try again.
For three or four years, I attempted to do positioning that way. Until I had a bit of an epiphany, I noticed that if I did not start with competitive alternatives, I often got to positioning that looked really good but it fundamentally didn’t work because it was non-differentiated.
Brian: Interesting.
[00:29:23]
April: And so, if what you really want is positioning that makes it obvious how your product is uniquely awesome, then, I have to start by thinking about competitive alternatives. Then I say, “Okay, if these are the actual alternatives, this is what I have that they don’t have. And these capabilities translates into value like this.” Then, I can say, “Okay, this is my value. These are the characteristics of the customer that makes them really, really, really care a lot about my value.”
Now, I have got value and customer, so I can figure out what’s the market context I want to wrap around my product that makes this value obvious to these people. So, you’ve actually got to flow through the five components, in that order, in order to end up with positioning that’s differentiated. So, that’s what my methodology does.
Brian: And is it something that you have observed regularly, that it really needs to flow in that order to have good positioning?
[00:30:19]
April: It has to. It has to. You can start anywhere else. Where founders want to start is capabilities because that’s the thing we understand the most deeply. We know our own product better than anyone else, right. And we generally understand [crosstalk: 00:30:35].
Brian: And we [have dreamed up some 00:30:36] whiz-bang new tech that nobody else has done.
[00:30:39]
April: Right. [laughter] We have got cool shit, it’s amazing. And so, I can talk feature and function all day. So, what I want to say is, “Oh, my gosh, I have got these features and they are amazing. Look at how amazing they are. And here is the value that that can deliver, therefore, these are the people we are going to sell to. And, therefore, this is our market category.”
And that’s all great, except you completely [Audio Skips 00:31:07] missed the part where customers don’t see it like that. Customers are never looking at you in a vacuum. Customers have the problem today, and they are solving the problem today with some sort of solution. And that might be a spreadsheet, or an intern, or another software, and you have to displace that. So, it doesn’t matter your whiz-bang features or whatever. What matters is, are you better than the thing I am doing right now?
And how this gets you into trouble is when you’re listing, “Here is all of my whiz-bang features.” Generally, your definition of whiz-bang has a baked-in competitor that you’re thinking about. You’re just not really explicitly calling it out.
Brian: Yeah, for sure. For sure.
[00:31:46]
April: And that competitor is never Excel. [laughter] And, yet, if you go to customers, quite often, the competitor you’re trying to displace is Excel, or hire an intern, or do this was a bunch of really painful manual crappy processes. So, that’s why you have to start with that.
Now, the starting point, as competitive alternatives, we often mess this up because we don’t even define that very well. And where I see startups, in particular, mess this up is it’ll go like this, I’ll say, “Hey, what are the competitive alternatives to what you do?” And they’ll say, “Oh my gosh, there’s all of these little startups.” And they’ll list them out. And there’ll be all these three-person startups in the Valley that have raised some money and they sound cool, but nobody has ever heard of them. So, there’s a bunch of them, there’s our competitors.
And I’ll say, “Okay, so what do you got that they don’t have?” And they’ll say, “Well, our big differentiator and the reason people pick us is ease of use. When you use one of those things, it takes 15 clicks to get a thing done. You use ours, and it takes like two. So, we are way better and our big differentiator is ease of use. And the value of that is saving time and blah, blah, blah.”
Then, you go to look at their customers, and you look at what were they using or what would they do if this thing didn’t exist? Where you say, “Hey, customer, if this team gets hit by a bus. What would you do instead?” And the customer says, “I don’t know, hire an intern or use a spreadsheet.” And so, you’re out there with a webpage talking about ease of use and value propositions that talk about ease of use, but you are never going to be easier to use than the intern. The intern is super-easy to use. The spreadsheet is super-easy to use. There’s a thousand reasons you that you don’t want to use a spreadsheet, but ease of use is not one of them. That’s the only reason why we use spreadsheets, we know how to use them and they’re easy.
Brian: Is it– Would it be more effective, then, to position it as saving money by saving time? [crosstalk: 00:33:39] There is something to cutting 15 steps to 3, [crosstalk: 00:33:44].
[00:33:43]
April: Well, again, you have got to think about it. So, are you saving time, right? Are you saving time? So, here is the thing. Depending on what your product is, it could be ease of use, because you could say, “Oh, there’s so much of this stuff that we have to get done, it’s actually hard to train the intern.” “Ah, so,” but that’s different than saying “four clicks versus one click.” It’s not the same, right. So, sometimes it might be that.
But, more often, it’s things like, “The reason you want to use ours versus the intern, is the intern makes mistakes because the intern is manually entering data in and a mistake gets made.” And then what’s the result of the mistake getting made? Oh, later on, down the line, somebody skilled has to do some rework, or we miss an order, or we get dinged on our taxes because the intern messed it up. And so, then you say, “Well, what we have that that doesn’t have is, we can save a profile.” And so, it’s not just ease of use, it’s less rework, and which may translate into saving time. But you actually have to start with what’s the alternative? And then what do I have that they don’t have for feature-wise? And then take that feature and translate it into value. That’s the trick.
[00:35:47] Brian: What are your thoughts on– What would your thoughts be on starting with the target market, though? Like, let’s say that I have a bunch of friends who own fly fishing shops. And I happen to know that they are using extremely outdated technology. “And so, I’ll bet you if I dig into there and interview some of those folks, I’ll do competitive alternatives next. But I am going to start with this market that I know well.” What are your thoughts on that sequence?
[00:36:16]
April: Well, so here is the thing. I get a lot of companies call me and they are exactly at that stage. They are like, “We have got a thing. We know this market because we have been around it and we know something about it. We have got this idea for a product and we’re launching next week. And so, let’s do some positioning around it.” And my response back to them is that what they have right now is a positioning theory.
They have got a theory and their theory is, “This is the alternative, an ugly practice. This is what we do better. [Audio Skips 00:36:53] Here is my solution to this, and I assume I know what that is. The people I am going to sell to are the fly fishing shops. And, therefore, my market category is a solution for fly fishing shops,” or whatever it is. [laughter] And so, I would say, “That positioning is fine. How would you know it’s not fine? You haven’t sold anything to any customers yet. You have done a bunch of customer discovery. You have tried to validate as much of your assumptions as you can, but you don’t know.” So, in those cases, I say, “You should just run with it and see how it works.”
Most of the time, what happens is, you get it out in the market and, it turns out, a lot of your assumptions were wrong and you just couldn’t tell until you got it out. And you might have features in there that you didn’t do discovery on that it turns out drive people crazy. Or you have some little feature that you didn’t do discovery on that everybody loves and it’s a surprise. And so, you’ll end up mucking with your product, you’ll put things in, you’ll take it away. At the same time, your market is not stagnant. So, your competitors are doing things, and things are coming in and out, and there’s new alternative showing up and stuff’s happening.
And so, the best time to actually look at your positioning and think about tightening it up is when you have actually been in the market for some time and you have got some traction, to the point where you can start seeing the patterns in, “These are the sorts of people that love us. And this is why.” And once you have got some of that, then, you can back up and do this, “Okay, alternatives, features, value, whatever, whatever [crosstalk: 00:38:31] in that way.” At the beginning, like I said, you’re always positioning even if you don’t think about it or even if you haven’t rationalized it, or anything else.
So, you’re fine to go out to market with your positioning theory but be prepared that, in almost every case, the positioning ends up changing as you start getting more experience with that market and you see what works and what doesn’t. In fact, most of the time I counsel early-stage startups to keep their positioning a little bit loose for that reason. Because you actually want to get exposure to a wide swath of customers, so that you can then figure out, “Well, who really loves my stuff, and why?”
Brian: Yeah. You have a section on that that I really appreciated, where you were talking about loose positioning. And it felt reassuring and realistic to say like, “Yeah, there is a better way to do this than most people are doing it. It’s this 10-step process. At the same time, the founder, you are going to iterate on this, this is not going to be [crosstalk: 00:39:40].”
April: Oh, yeah, totally.
Brian: Yeah. “We do this exercise. We have our positioning now and forever, and, therefore, we can go.” It was, I appreciated that that piece of the book.
[00:39:51]
April: Yeah. And things change all of the time, right. Markets don’t stay the same and your product doesn’t stay the same. Your customers don’t stay the same. And so, it doesn’t make sense that your positioning would stay the same either. So, even after you have nailed your positioning, your positioning can get messed up.
So, I have had products– It’s funny, I was telling a story, I wanted to tell a story at a conference about the first product I ever positioned. And so, I looked up to see where is that product now. Because we eventually got acquired, and then that company got acquired, and then that company got acquired by SAP. And so, this first product that I ever repositioned, we repositioned it, and at its peak– I have no idea what the revenue is on it now because SAP does not report it separately. But, at its peak, it was a billion-dollar business, just under a billion dollars. And if you look at the page, the landing page they have for that product, it still exists today. It is 20 years later, and it’s not that different from how we positioned it 20 years later.
They talk a lot more about [crosstalk: 00:41:07]. We had positioned it as an embeddable database for mobile devices. They are talking a lot more about Internet of Things. But so, the words have changed, but it’s pretty much positioned the same.
Brian: The function, yeah, yeah.
[00:41:22] April: At the same time, I have another product that I worked on a few years after that one, where we positioned it and we thought the positioning was so good. The positioning was good, it was beautiful. It worked amazing for six months. And then, six months later, a big competitor entered the market with 10 times the funding that we had, with a feature– That ours was patented, so we thought it was really defensible and no one could copy it. These guys showed up with a patent on a different thing that did pretty much the same thing. And so, we were like, “Oh, shit.”
Brian: There goes that moat.
[00:41:57]
April: Yeah. And we [Audio Skips 00:42:00] kind of a dramatic shift in positioning to get out of their way because we couldn’t beat them. And then that lasted, and then that worked pretty good too. And that lasted for about eight months, and then that company got acquired. And they basically got taken out of the market. And then we were like, “Ooh, now, we can actually do some stuff that we couldn’t do six months ago.” And so, we ended up doing a little shift in the position to take advantage of that.
And then we, ourselves, almost got acquired. We had a deep partnership with someone, we were about to be acquired, and then our partner got acquired. And so, all of this positioning we had where we were aligned with this partner, we had to take a step back and shift that again.
So, on the one hand, I got a product where the positioning hasn’t changed in 25 years. And on the other one, I have got a product I worked on for, I think, I was only there two years. And in that two years, I think we repositioned that sucker like four times. [laughter] So, you don’t know, the lesson in this is that it’s not static, and you need to keep your eye on it. Sometimes, it lasts for a long time and sometimes it hardly lasts at all.
[00:43:11]
Brian: Well, thank you so much for your time and everything you have shared with us today, April. How can listeners find and follow you online?
[00:43:19]
April: So, I have a website, it’s AprilDunford.com. You can go there. And I don’t– I tweet a little bit on the Twitters, I am @AprilDunford. You can find me there. And I am on LinkedIn and all of those other places. But I am not super-active on social, except maybe Twitter, which I do quite a bit of Twitter when I am bored at the airport. Which, this year, is a lot.
Brian: It’s been a lot. [laughter] My guest today has been April Dunford. April, thank you so much for your time.
April: Yeah. Thanks so much for having me.
[00:43:54] [Music Plays]
Brian: Alrighty, let’s do some closing thoughts. And today is a snow day, here, in Boulder. And so, my kiddos are home from school this morning. You might hear some, you might hear some footsteps up above my home office, here. So, if you do, please excuse that little interruption.
Just for starters, I thought it was kind of interesting, April talking about how writing the book was like, it was very much like launching a product. And she did some research and some positioning research beforehand. And so, then it should be no huge surprise that after it was released and given some time, the snowball effect or the flywheel kind of came into play there. And, as time went on, it became easier and easier for her to continue booking engagements, to the point where there were too many. And so, I just thought that was interesting to hear her talk about that.
One fascinating thing, just about the whole approach April’s whole approach to positioning. It’s interesting to me because, according to her point of view, the same code base, or the same exact product that you have in your hand, that’s actually five or maybe even 10 different products. If you’re able to completely change the way it’s perceived, it may not be that you need to add more features, burn the thing down, and rebuild it. It might not be that you need to actually change anything if you’re failing to, if you’re struggling with traction. It’s just that you’re in the wrong context. That your potential customers are putting you in the wrong category and comparing you to the wrong competitors so that you look weak in comparison to them. And so, you think that you need to add features, or change this, or change that. It might actually be that your positioning is off that.
That assumes that you have done what April did with her book and what you ought to do. Which is do some good customer research beforehand and understand that there is a market for what you are building. If there is a market for what you’re building and you’re struggling to find traction in that existing market, then, yeah, probably your positioning is off. You may have some missing features. You might have a bad onboarding experience. Like, fill in the __ of what could be a hundred things. But if there is an existing market and you’re having trouble, then, something is going on.
If you’re struggling to get traction because you are creating a brand new category, truly, a brand new product, truly a brand new category, it’s probably not positioning. You might just be biting off more than you can chew unless you have tremendous, tremendous funding and a long runway to spend a lot of money, not only on building the new thing but on educating the public. So, just keep those things in mind.
Let’s see, that thing of email for lawyers versus secure team collaboration for lawyers, I think was a real– I am so glad that she shared that particular example. I think that’s a wonderful crystallization example of this idea. The exact same code base. The exact same product, slightly different headlines, slightly different positioning. And all of the assumptions that you make, the table stakes that you assume that have to be in place are completely different.
There was also an element of this conversation that reminded me of something that Patrick McKenzie, @patio11, if you’re not following him on Twitter, you ought to. That he said, very recently, and he was basically applauding this article, I will link to it in the show notes, called “The ‘Marker’ Guide to Content Marketing for Non-Hucksters.” The article is totally about writing and how to position yourself in your writing, so it’s talking about positioning as a personal brand. And Patrick McKenzie is calling attention to this one particular idea that he lays out and says, “Right at the intersection of two hard and valuable things.” And so, it’s a great article, check out Patrick Mackenzie’s tweets about this. If you are individually trying to write, trying to position your individual self, it’s a great article about that.
It directly ties to and it has so much overlap, conceptually, with the way that April talks about product positioning. That it feels like those truths mirroring one another and reinforcing each other just elevates how important and how potentially impactful and meaningful this approach can be. And so, I highly, yeah, I totally recommend you check that out.
And so, back to product positioning. It’s super-important because, whether you like it or not, potential customers are going to put you in some context. And so, you ought to be the one who is in charge of that. There was a really great interview recently on Indie Hackers with the CEO of Less Annoying CRM, that is the name of the company. The CEO is Tyler King. The company is Less Annoying CRM. What is so funny is Tyler says in that interview several times, like, “We’re terrible marketers. Wea re bad at marketing. You know, because we’re not good at marketing, we decided to focus on whatever.”
I would bet you that April Dunford would give Tyler King a very big pat on the back and say, “That is phenomenal positioning.” Already to be saying, the name of the company is Less Annoying CRM. Well, you already– Even the example she was using in this interview was of CRMs. And so, who are your competitors? Well, you know who they are? Why are you better? “Well, they are annoying and we’re less annoying.”
And so, this tiny, little– It’s not even tiny. This small, little company that most people have not heard of because they don’t make a big splash on Twitter. And, until very recently, showing up on Indie Hackers, it’s just not the sort of– It’s not that company that you would see parading around and garnering all of this attention. And yet, they have got millions in ARR, and many thousands of customers in an extremely crowded and very mature market. I mean, CRMs, what better example is there in the SaaS space of a crowded mature market? And they have done it with phenomenal positioning.
And so, it’s important to– The flipside of all of that a great product that’s well-differentiated, and it has good features, and it offers the value that other things don’t. If it’s in the wrong context, if it’s competing against the wrong things, it’ll fail. And the component pieces that April talked about that are important; market, category, competitive alternatives, unique capabilities, value, and your target customer. That was really interesting to mention that they are all, the interrelatedness of those components is really interesting and it kind of puts you in a constant cycle.
And that if you want obvious positioning, start with the competitive alternatives. What are you displacing? And are you better than the current and existing solution? I felt myself try to disguise it, effectively or not, I am not sure - you be the judge. But I tried to disguise it in the interview because I initially reacted against her suggestion to say, “You have got to start with the competitive alternatives.” Because my gut to that was, “No, no, no. I am not sure, I think you want to ignore your competition, and do your thing, and focus on your customer. So, you would want to start with your target customer.”
As I listened back to it and get gave it more thought, April is not saying start with your competitors. She is saying be sure that you are starting with and thinking about the competitive alternatives. So, not competitors by company name; competitive alternatives by existing solutions, spreadsheets, interns, yes, a competitor product. And so, but the distinction between competitive alternatives and thinking about starting with your competitors is a very important distinction. And the more I thought about that, the more I appreciated it and the more enjoyed it.
And then, finally, super-important and good advice early on, keep this especially loose. This is not something you’re going to etch into stone and then carry on with you for two years or even one year. It’s a theory, as she said. You are gonna have a positioning theory that you need to get out there, and test, and iterate on, and change. And so, especially when you’re early, even a mature company, in an established market, is going to need to reposition on a regular basis because things change. If you’re early, it’s going to be even more dynamic than that.
And so, I think this is harkening back to my closing thoughts on “Shape Up”, with Ryan singer, to say this is really, really good advice. This is a good framework. But the author is not handing this down as absolute dogma, “That you are going to do this thing, and then you’re set, and it’s all good.” No, no, there is some flex in here, follow this framework. If you do this, you will be in a better position than you were before, I can almost guarantee it. Also, be prepared to flex, and to change, and adapt in some ways that are going to be very unique to you and the problems that you’re facing and solving.
So, let me know what you all think. I am @BRhea on Twitter, that is B-R-H-E-A. It is always so good to hear from y’all when you reach out and let me know what you liked and what you didn’t like. You can also go to BrightAndEarlyPodcast.com. If you’re liking the show, just let a friend know, it would mean a lot to me. And I will talk to ya’ll next week.