February 24, 2018

Archives for October 2017

Making a Big Mistake in Product Positioning?

Recently, I was at an entrepreneurial networking meeting and I saw this written on a whiteboard.

Common Misconception in Product Positioning

Common Misconception in Product Positioning

I apologize for the low quality image, but it shows a process of where your start with your product, then you determine how to position in your product in the market, which then drives your promotions for your product.

When I see positioning presented like this, I want to cringe, as this is such a common misconception of positioning.   The common mistake is that positioning occurs after the product is defined.   My response to that is, “how do you know what product you should build if you don’t know what position you want to achieve and with what market segment”.   That determination of target market segment and desired position can result in completely different products based upon those two key decisions.

So allow me to share some additional background.   The early definition of positioning by Trout and Ries clearly stated that positioning occurs in the mind of the customer.   And I agree, that ultimately, the customer (the market) owns how they want to position your product in their mind.   But our goal as product managers and product marketers is to select our desired position and effectively use our Ps of marketing (Product, Price, Place, Promotion) to influence our product’s desired position in the mind of the customer.

The mistake that people make, including some very smart marketers, is that they look at positioning as being primarily driven by promotions.  While in some consumer markets with commodity type products, where you are focused “principally” on making an emotional connection to your brand, this might be true.  But in most markets, you must leverage all of your Ps of marketing to build and support that position in the market.  Thus before you completely define your product, pricing strategy, promotion strategy and channel strategy, you need to first decide upon your positioning strategy.

Many people will argue my above point by stating that they are lean and they are iterating themselves to Problem/Solution Fit or Product/Market Fit.   And I agree that in opportunities where they is uncertainty around the problem and the right solution, you have to iterate through various positions before you arrive at the right Fit.

Why do I say iterate through positions (Positioning)?  If you read the standard format for the positioning statement (as created by Geoffrey Moore), the components include both your value proposition and your competitive differentiation.   Those are key decisions that you can begin to iterate through before you even know what your solution is.  Theoretically, I can, and should, define and validate my product positioning before I even know what my product (solution) is.

My Message – Start by defining and validating your desired product positioning before you formalize your product solution!

Please see more about my thoughts on positioning and go-to-market strategies on my SlideShare presentation.




Product Management Lessons From The Street

The more time I spend in Product Management, the more I look at day-to-day experiences through the lens of a Product Manager.  Almost daily, I encounter an experience with a product or service where I’m either really impressed or very dissatisfied with the experience.   From those experiences, I see the application of important lessons for Product Managers and Product Marketers.  I’m going to use this series of posts to share with you those experiences and the lessons that we can learn.   I hope you enjoy these posts as much as I enjoy writing them.

Product Management Lessons From the Street – Posts

  1. How Much Profit Is A Poor Online Experience Costing An Offline Service?
  2. What Can Airlines Learn From the 3Ps of Services



What Can Airlines Learn From the 3Ps of Services

The airline industry consistently ranks as one of the most disliked industries in the United States, along with health care, the postal service and telco providers.  But does it really have to be that way.   Are there some simple things the airlines can do to improve on this status?  Let me relate a story that show how a simple application of the 3Ps of service (the new 3Ps in addition to the traditional 4Ps) might make a difference.

If you’re not familiar with the Ps of marketing, the traditional Ps of marketing are product, price, place (distribution channels) and promotions.   With the increase in service oriented products being offered, there are 3 new Ps that have grown in importance – People, Process and Physical Evidence.

Several years ago, I was on a flight to Chicago, and toward the end of the flight, I realized that something was different about that flight.  I was experiencing some of the best coach class service that I had experienced in recent years.   And I started to think about why this time was different.  After thinking about it for a few moments, I concluded the following made the difference:

  • In most flights of that length (2 to 3 hours), the flight attendants come through the cabin once to offer a drink, and then they congregate in the back galley to chat or read (and do some of their paperwork).  If you need anything else from them, you have to push the call button or go to the back of the plane.
  • On this flight, the flight attendants passed through the aisle multiple times offering water, not just the once.

When I had a chance, I went back to the flight attendants to compliment them on the excellent service.  They were grateful for the compliment and noted that many flight attendants don’t have the same attitude toward service and do the minimum required.

That got me thinking about how the new 3Ps of marketing applied in this case.  But before I share my thoughts, I want to emphasize a couple of points.

  1. First of all, I don’t want to want to bash flight attendants in general.   I believe the challenge for most flight attendants are problems with the policies of the airline companies and the industry in general.
  2. E.g., when the industry states in their announcements that the flight attendants are there primarily for your safety, that already sets some expectations on service.   I think this statement is primarily a US industry statement, as I find other carriers in other countries have a much stronger orientate toward service.

So let’s apply the 3Ps.

  • Process – I’m going to start with process, as this seems the most relevant.   The airlines definitely have lots of process in place around safety, security and some of the service work.   It can’t be too much more difficult to enhance some of the process around customer service and set expectations around passing through the cabin and offering water on a more regular basis, instead of sitting in the back chatting.
  • People – Some airlines are well known for having hiring practices that make sure they hire people that really enjoy serving and engaging with customers.  I’d like to think that all airlines try to do this, but it’s clear some airlines treat this with a higher importance than others.   But you also have to give the flight attendants the right training to understand and apply the customer service processes and in the importance of doing that.
  • Physical Evidence – In my specific example, the water or selection of drinks would be the physical evidence of the service provided.   So this brings up another interesting point.  On another flight (a 3+ hour flight), I went back to the galley to get some water, and was speaking with the flight attendants about coming through the cabin more often, instead of making us go to the back.   This flight attendant stated that they were supposed to go through the cabin more often, but if they did, they would end up serving more water, and they didn’t have enough water on board the flight.  So they were controlling the consumption by making it a little less convenient to get water.   I don’t know if not enough water was just for this flight, or is a common situation because the airlines are trying to control costs (or possibly weight).

As I think about the application of people and process in this particular example, it has really has almost no cost associated with it, but yet it can reap so many benefits in developing a more positive image around an airline, and the industry.

What are your thoughts about this?

How Much Profit Is A Poor Online Experience Costing An Offline Service?

Several weeks ago I took my son a theme park at which we held season passes.   So the night before, I decided to purchase some “extras” online before arriving so that we could get right to fun upon arrival.   As much I tried to make these purchases ahead of time, the site proved far too confusing to complete an online transaction.

So here’s what happened.

  1. First of all, I logged into my online account that I already had, and for some reason, I was not seeing the discounts that season pass-holders should get.  As I looked through my account, I realized my annual passes were not registered to my online account.   How could that be?  I purchased the annual passes through my online account, so how could it not have my pass already registered?   In the end, after of many minutes of frustration, I finally found a place to where I could enter a long and almost unreadable number from my annual pass to register my annual pass with my online account where I had purchased the annual pass.
  2. Next, the theme park actually has two sections (main theme park and a water park).  I had purchased annual passes for both parks, so I assumed that I could purchase the “extras” for both parks via that one online account.  Wrong again!   As I desperately searched for the “extras” to the water park, I discovered those extras could only be found on a website for the water park, and not via the main theme park.   So I went to that water park website where I tried to login using my online account, and ….., it wouldn’t login.  It appears that I had to create another account on that website to make online purchases.   At that point, I finally gave up in frustration and decided not to purchase any extras at that time.

So my question for this theme park, and for you, is, even if you are an offline service, what is your poor online purchase experience costing you?  Without thinking about it, I would automatically want to say this organization must invest in creating a much improved online experience.  But should they?   Is it actually costing them, in revenue, brand reputation, etc?

If I were in their position, I would want to ask and answer the following questions.

  • What percentage of people who fail to buy extras online, never purchase these extras upon arrival?  Or purchase fewer extras onsite?   Can I track these attempts and connect them to onsite purchases (for a season pass-holder, I think yes)?
  • How much does our poor online experience impact our brand reputation?   Does it keep people from coming to our park or keep season pass-holders from renewing annual passes?  Does it impact our online reviews?
  • How can we test the impact of improvements before we make them?   Can we do this via small incremental investments?   If large investments are required (in this case I think the park needs to make some major integration investments), how can I measure this?  Through customer interviews, customer surveys?  By answering some of the above questions?

While there are other questions we could ask, the main thing is that this park, and your company, need to consider these possibilities and then put metrics in place to determine how improving the online experience will benefit the organization.

BTW – my son and I had an amazing two days at this theme park, in spite of the of the poor online experience.  Would I have purchased more extras than I did?   Probably