6 Steps for a Successful Tech Product Positioning

If building products is complex, positioning your product is even more complex. No matter if you're a startup or a Fortune 500 company, and no matter if you're launching your first or 10th product. How you position your product sets out what you do. 

What is it, where do you start, and how do you position your product?

Let's take a deeper look.

Product Positioning: What is it?

Tech product positioning is a principle that defines where your product fits in the marketplace and how it is differentiated from both direct competitors and other potential substitutes. 

It is less about a market competition to push a product into an existing market and more about market definition relying on identifying and latching onto specific targeted groups.

From a brand growth point of view, it is the ability to define what you are, your value proposition, and what segment of the market you're carving out to attack.

It is no longer enough to launch the best product in the market, but it needs to be a "must-have." And this customer perception of your product depends on their personal experience, advertising, reviews, and social media. 

Here's how good product positioning can influence potential customers' perception with a complete product experience (CPE).

Why is Product Positioning Essential?

  • Makes your product stand out by leveraging points of difference.
  • Amplifies messaging and storytelling.
  • Helps you cut through the noise, allowing you to speak directly to the individuals you wish to attract.
  • Justifies why your prices are higher or lower than those of your competition.
  • Sets off an emotional response from your target audience, winning their trust quickly and making purchasing easier and faster.
  • Cut through the vagueness, talk specifics, and compete on value rather than price.
  • Makes your design intuitive, meeting your customers' expectations in terms of taste and preference.

The Earlier Product Positioning is the Better

While both rely on in-depth target market understanding and identifying pain points, product planning differs from product positioning. Product planning refers to the upfront building of a tech product, while product positioning is the first step in the go-to-market strategy. 

Even before building the product, defining product positioning ensures a high-level definition of target market segment desires and an optimal product/market fit achievement. 

Of course, this is easier said than done. But it all comes down to conducting extensive market research to gain deep insights about customers' pain points and needs, even before they realize them. If you can come to this understanding, product launching will be a breeze, and messaging will derive directly out of the positioning you established early on.

6 Steps to Create an Effective Product Positioning Strategy

Step 1: Analyze the market context

This step isn't just a framework to see how many people will love your product, but what they'd do if it did not exist, who your competitors are, and what value they derive from you.

  • Identify demographic trends
  • Identify technology trends
  • Watch out for rules and regulations
  • Stay updated about the economy and sociopolitics. 
  • Watch for new and disruptive competitors.
  • Keep an eye on potential uncertainties 

Step 2: Understand customer expectation

Pick up trends and needs through customer surveys, market research, and social listening

Step 3: Determine the market's maturity

If you are entering a relatively new market, you must first establish the problem before discussing your offering. In an established market, simply presenting your solution will be sufficient, but you'll have to convince people with your value proposition, not with features, but with benefits. 

Step 4: Determine customers' state of mind

To determine in which state your customers currently are, answer the below questions:

  • Are they unhappy/unsatisfied with their current solution?
  • Are they attracted by what you have to offer?
  • What are their major concerns? 
  • Will they need to change a "habit" when switching to your offering? 

Step 5: Analyze your competitors

In this step, determine your competition and compare and contrast their offering, market position, marketing strategies, strengths, and weaknesses with yours. Here's how you can do that: Competitive Analysis: What is It and Why It Matters for Tech Product Leaders.

Step 6: Craft a positioning statement

 After you've studied the market environment of your product inside out, you will be able to create a positioning statement. It is a one or two-sentence declaration of your product's unique offering to customers and it covers: 

  • Who is it for
  • What is the need
  • Your offering
  • The solution
  • The benefits

Take a look at Slack's positioning statement:


What's next?

Now you need market research using a combination of qualitative and quantitative input from surveys, focus groups, polls, and interviews before carrying out your marketing plan. 

Positioning is a complex topic, but when it comes to successfully bringing a product to market, there are no shortcuts. Customers do not have a single-minded focus. It's the companies responsibility to stand out, go beyond presenting features and benefits, focus on the customers, and differentiate their products. 

Elke Nijhoff - Product Marketer & Strategist