How to create an effective product positioning strategy

How to create an effective product positioning strategy
Building an efficient product positioning strategy is essential for growth!

Almost 50% of startups fail because their product doesn’t meet a market need! From identifying your target consumers, how to develop your solution, until crossing the chasm to a much bigger market, many slips can occur.Here are incredible strategies and concepts to help you build a successful product positioning strategy and increase your market share with no complications!

What is the chasm?

In his book Crossing the Chasm, Moore divides the consumers into five categories: the innovators, early adopters, early majority, late majority and the laggards.All these groups present particular patterns of behavior and adoption of new products and innovation, being the first two more volatile and the others, long term consumers.The chasm is, according to Moore, the gap between these two groups: early adopters and the early majority.It’s really important to pay attention to the early adopters because they are the ones more open to new technologies, but interested in their practical applications. They’ll provide you with necessary adjustments to your product.

Approaching the markets

As each of these groups has different behaviours and different expectations regarding the products they acquire, how you approach them will play a huge impact on your product success.Innovators are up for the adventure. Even if you present them a proof of concept (POC), they’d still be interested in understanding how it works and which benefits come from this new product.As early adopters look for practical solutions. They need something that can solve a problem, and that’s why they’d be more open to a Minimum Viable Product (MVP). This is crucial! Here you will find all you need to move on with your first MVP and no headaches!With an MVP you can collect data and consumers’ insights to move on with the development of an entire product and fix any issues. Because that’s what most people want: invest in a product that performs well and not feel they’re wasting their money in something uncertain!You could start with a Beta version of your product and see people’s reviews and how they react; run surveys with the first customers, and experiment with A/B testing. We recommend the Lean Startup methodology, as you’ll see below.

Accelerating development with Lean Startup Methodology

Lean Startup helps to accelerate the development of your product through experimentation.

To make the development phase faster, you can turn to the Lean Startup methodology, which is based on investigation and experimentation.There are two simple ways to deliver your product without spending much time and money. The first one by focusing on design and targeting market feedback; the second, by copying an existing app and developing your prototype, focusing on the features.It’s from consumers’ insights into the POC and MVP that you’ll develop the market requirement document and start to plan the necessary improvements in the next stages of product development. In the development stage, keep the application simple to use and avoid adding unnecessary features. This will save you time and money!In fact, you could pre-sell your solution to gather the necessary funds to move on with development. Knowing that some people are willing to pay for your offer is really encouraging and a great sign that you are on the right path. Plus, it will make others interested as well.We could say that the startup project ends at the chasm, but it doesn’t mean the work is over.

Product positioning: Niche is THE key!

Focusing on a niche is essential to become a reference in market!

When positioning your product, you must look at a specific group of people with a particular problem to build a reputation for your product and services and become the leader of the segment.To get a more pragmatic overview, you can use frameworks like the SWOT and Pestel, to identify threats and strengths; or Benefit Segmentation and Cohort Analysis, based on consumers’ perceptions and experiences.Evaluate your competition and identify your unique positioning. What your product can offer that will make your consumers’ life easier, simpler, better? Take into consideration existing attitudes, habits, past experiences and cultural values. That’s how you’ll become the reference!Ever stopped to wonder how a group of students built the most used social media of all time? Exactly. Facebook targeted students at Harvard University. When it was consolidated, they started focusing on other Ivy League institutions. It doesn’t matter how small this niche is, but how representative it is to solve that pain and how it matches your objectives.

Be a pirate! The AARRR Framework.

Use your metrics to establish clear goals for your product.

Apply the AARRR Framework, aka Pirate metrics. It stands for Acquisition, Activation, Retention, Referral, and Revenue. This framework will help you answer a few questions that you should be asking already at each stage of the funnel and think clearly about strategies to improve your business and grow!


Which channels are bringing the most qualified leads at the lowest cost? You can easily track that with analytics tools, such as Google’s, Kissmetrics and Mint. Besides, every social media has its own analytics tool with basic demographics and audience behaviours.


How’s your customer experience? Are they able to find/do what they want and need? Do they come back after the first visit?Again, pay attention to what your customers say about your product - and about the competitors as well.


How many of your activated customers are really staying and how many are leaving? And why? If the number of those leaving is higher, go back to Activation and review your customer experience!


How many of your customers became the advocates of your brand and product? How can you incentivize them to refer your solution to others?Offer discounts, make give outs campaigns, incentivize a community of like-minded people, create a waiting list, allow users to share their thoughts.


Customer Lifetime Value (CLV) - Customer Acquisition Cost (CAC) = How much money you are making. What strategies can you use to increase your CLV and decrease your CAC?Look for content that keeps existing clients engaged with your brand; offer omnichannel support; create long-term subscriptions for a discount price; develop limited editions. Really look for ways to keep them interested and make business with you.One of the best things you could do to attract new consumers and keep old ones engaged is to use fads to drive growth.But remember that your product should correspond to a real need, and fads are a momentary habit that creates a fizzle in the media. To understand it better, have a look at our article about trends and fads.

Guide them to change

Your product should be designed in a way it’s simple to demonstrate its usage in daily tasks. The benefits should be clear even if the product is not physically present. People should feel compelled to use your product because it offers them something no other is capable of. That’s what we call the Unique Selling Proposition (USP). Show consumers what makes your product stand out from the competition!Remember Steve Jobs’ keynotes of each product? That’s your aim! Turn the product into a desire, and make consumers curious to know more about it and the countless possibilities your product offers!Have a look back at your product positioning analysis and really think about the User Experience (UX) and how you want your customers to feel and interact with your solution. UX takes into consideration all the design elements and how information is structured. Where the user is and where he/she needs to go or do to get what they want and need? Bear that in mind!Do not forget that most people are led by the subconscious when it comes to making the final decision, so you need to commit to providing them with good experiences and positive emotional feelings. This video will show you how!

Follow the map

Use a Roadmap to keep your long and short-term strategies on track.

Of course, none of this is effective if you don’t roll up your sleeves and really study your market, pay attention to your consumers and competition, with a clear vision of where you want to get.Now that you know all the necessary things, our biggest recommendation is to build your Roadmap. This amazing and simple tool will help you plan all the long and short-term goals of your project.It’s perfect for starting businesses for its flexibility, it provides a framework for planning and coordinating technology development.And if you are ready to go further in the development and learn how to manage your tech project take our 0 to million users course to start with the right foot! Access for even more free content on startup management6d

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