3 ways in which Brand Positioning influences us silently

MANHATTAN (3)I’ve usually been averse to buying premium branded apparel. For the simple reason that I could always find equally good clothing which isn’t necessarily a Lacoste or a Tommy, and which is as elegant and durable as that venerable brand.

Garments is a very competitive industry. You are spoilt for choice and there are more brands to choose from for every category than the number of hours in a day. Which is probably the reason you can get a good deal if you shop around enough. In a market where product differentiation is reduced to sticking a label on the shirt, it becomes very easy to ignore the pull of a brand and look for value instead.

#1 Discoverability

My bias towards ignoring a brand took a hit when I went shopping for a set of tyres. Now this is an industry with less than 10 brands. And they are not bought based on the label stuck on them. It was difficult to believe that the Continental, Bridgestone and Yokohoma brands (I left out Michelin on purpose), were slowly but surely getting an edge in the replacement market over time tested Indian brands. The first battle they’ve won over others, is the sheer reach. They are present overwhelmingly in front of you, wherever you go. Most purchase decisions are made by engaging with brands that are easily discoverable. It is only a handful of customers that does serious market research in the quest of finding every product they can lay their hands on before choosing amongst them.

#2 Value proposition (what can I do for you)

What each brand told me was a story. Continental said its new technology, Bridgestone said wide acceptance / long term player, and Yokohoma claimed high performance. In this milieu, I could barely hear what Apollo / MRF / Ceat were trying to say. I came away with the distinct impression that they have confined themselves to being manufacturers of OEM supplies and Truck tyres! Both of these segments do not require them to position their brand to the consumer.

I made my choice, and it was on the basis of brand positioning. No prizes for guessing which way I leaned.

#3 Believability

It’s easy to promise the moon and every seller would like to believe their brand is God. In the courtroom of the consumer however, decisions are swift and ex-party. Which means, you do not get a second chance to be heard. This is where believability or trustworthiness comes in. In my case, it was the dealer who swore by the product I bought. Do we convey trust either directly or through media or through our sales touchpoints? If not, then you are seriously under exploiting your brand’s potential.

Indian Software

This is precisely the problem that plagues software from India. To this day, we are immersed into selling our products by feature and rarely take an emotional position in the consumer’s mind. A brand connects with the buyer at an emotional level. If we want to be world class, saying how good we are will not help. How we can transform the life of the buyer, is what matters. And that is where branding and positioning comes in.

Emportant HR Software

I then thought about what we stand for as a brand. Emportant has a deeply committed team, founders with deep roots in product software and the HR software industry and yes, we’re also new-age and high-tech. So what do we stand for? Our effort will be do bring forth our Brand value to you in the coming months. Brand should also be a truthful reflection of the company ethos. We’d like to be perceived as trustworthy, caring and progressive. We’d like to be quoted as being versatile and easy to adopt. You can help us in this journey. Just write back and tell us what you think about Emportant and be part of shaping our story (click here to share comments). Because we believe that in our story, the best is yet to be told.

Yammer is facebook for Business! – Product Positioning and Messaging!

Yammer is facebook for Business! – This was apparently the Product Positioning choice of its own CEO.  The CEO thinks that this is good shorthand for conveying what his product is all about. It could also be meant in a pejorative way. Users could feel that the user interfaces and functionality are too similar to each other, and so may not be too original!

Here is a funny example of bad product positioning:

This product claims that it can not only clean your skin but also gives you a burst of energy? Sort of Dove Soap combined with Red Bull? What else can it do? Increase your brain power and makes all your kids geniuses?

On the other hand, here is a terrific example of both excellent product positioning and messaging together:

http://youtu.be/lpCJ-H0iUzI

If you watch the ad carefully, you will see the words Born in America on the front of the truck and the camera dwells on it for a few seconds before it moves on. Also you see the word Tundra in huge letters on the side of the truck. This is because their main competitors in this class of truck are Ford, Dodge Ram and Chevy.  They bombard the airwaves with ads that claim that they are tough american trucks implying that Toyota trucks are not. So with this one commercial Toyota is trying to message two things.1. that they are tough enough to tow a space shuttle and 2. that these trucks are not only manufactured in the US,  but designed also in the US! Here are some samples of what Toyota was up against:

Built Ford Tough!

http://youtu.be/Bp6wgu3-uwk

Here is the other big competitor for Toyota – Dodge Ram.

http://youtu.be/s4qNhYBp59k

Product Positioning involves broadly the following:

*   The Product Category or the market in which the product will compete. Could be broad ones like Social Media, Business to Consumer (B2C), Business to Business(B2B), etc. or narrower than that,  like Customer Relationship Management (CRM) for Textile SME companies, for example.

*   Defining the Encapsulation or the Attributes of the product that define the Product Space more completely. Could be Status Updates, Images, Videos, Instant Messaging in the case of a Social Media product or attributes like Prospect Registration, Prospect Emails, Contact Tracking, etc in the case of a CRM product for SMEs.

*   Surveying the perceptions of a sampling of prospects, customers and clients about your product or idea or existing solutions from competitors. This is one area learning up on Lean Startups and how those methods are used could be invaluable..

*    Visualizing or mapping where your product stands in relation to others in the market.

*    Determining your current location in the Product Mapping and assessing how well your product fits the market.

*     Making adjustments to your product positioning and features so that you are comfortable with the new Product/Market fit that the changes would bring you.

Documentum is a great example of how a company changed its positioning a few times to become one of the most successful Document Management Software companies. They first started with a custom solution to store, index and retrieve Training Manuals for Boeing. They then morphed into a Document Management solution for Pharmaceutical companies that required a similar solution to manage a new experimental drug’s FDA approval process. They needed a system to store large volumes of data in documents and spreadsheets, index them and make them available through search easily. In addition they wanted a system where someone could check out a document for editing and check it back in when done. You don’t want two people copying a document, making changes independently and over writing each others’ edits. Their next move was to make this a general document management system that could be useful for many other groups of people – like attorneys and paralegals to store and edit filings for cases. Today they are part of EMC corporation who integrated workflow systems with the Documentum document management system to add to its utility.

The above is also a great example of how a “document management system” category could be merged with another category “workflow systems” to create a super category “Collaborative Environments”  to compete with other products like Microsoft Sharepoint Portal.

 Product Messaging involves the following and follows Product Positioning:

*  Following proper Product Positioning, the proper messaging efforts starts with profiling your prospect, client or customer depending upon what your product is. What is the buyer Persona or Personas?

*  What is your product’s value proposition to each of your buyer personas?

*  Evaluating your product’s value proposition. This is one area where Lean Startup methods come in handy again.  Is it as valuable to your customer personas as you think they are?

*  Evaluating your competitors’ messages

*  Crafting your own messaging

*  Testing your messaging

*  Rolling out your messaging but do testing and refining on a continuous basis

Here’s a great example of how Steve Jobs keeps the messaging about Macs, iPods and iPhones very simple and keeps it to the point!

http://youtu.be/of_8iC6P9Cg

Product positioning is critical to a product start-up’s growth and determines to a large extent what your messaging will be. It may be possible to change the positioning drastically earlier in a start-up’s life  but as you line up customers and revenues,  it may become more difficult to pivot. Clean slate approaches where you change the name of the company and the product is also possible and done often!  This is also when you realize that you need one or two other competitors in a product space to make it a proper category! Categories always make it easier to describe what you are doing  and explain what makes you different. Investors are also comfortable with categories since they provide some validation of the product space. If you have competitors, others may have invested in them and so, reduces risk for them!

I learnt the hard way about positioning in business, about catering to the right segments – Shaffi Mather.

Nurturing Product Managers & Entrepreneurs

More than 3000 product companies generating revenue of $2 Billion – that may sound miniscule compared to $100 Billion IT services industry.  It is pertinent to look at how the eco-system needs to be developed to create $100 Billion Software product industry from India over the next decade. Ambitious ? Yes, but not impossible. There are few fundamental building blocks which needs to be laid to make this as a reality.

Over the years as an entrepreneur and as a mentor, I have interacted with a number of product startups on how they view their startup and more often than not, conversation revolves around one of these questions especially when the startup is in their early/idea stages.  I am beginning to sense few recurring themes during my interactions with product startups ;

  • Problem definition
  • Business Model
  • Competitive landscape
  • Product positioning

 

Problem definition: What problem we are trying to solve?

As a startup, in my mind entrepreneurs tend to focus too much on solving the problem versus spending adequate time and effort in defining the problem they are trying to solve.

In most cases, for a services company, the customers discover the problem and provide it to a services company. Half the battle is won ; the remaining challenge is to find a best-fit solution.

But the product company has to identify a problem that is large enough to solve with their product while at the same time looking for a space which is solveable as a startup…

As product companies we make a few common mistakes in this aspect –

  • We think there is a problem and look around for confirmation ; differing opinions are quickly discarded – a classic confirmation bias problem
  • We spend a very small portion of the time defining the problem and eager to jump to the solution ;

It is key to pullback and spend the effort in defining the problem clearly. It is all the more difficult if it is a new / different area than the entrepreneur’s core expertise. It is essential to observe the domain landscape, network extensively and validate the problem with practitioners before trying to solve the problem.  While it is said that newcomers have an innate ability to look at an existing industry problem very differently, but, it is quite critical to understand what is going on before relooking at the problem with some fresh set of eyes and ears.

Business model : What business we are in?

Business model is the guiding light , will always be in the back of our mind. Granted it gets ignored for certain short term gains at times. As product startups/entrepreneurs, we get caught between the million dollar question : short term survival mode and long term vision.

I am guilty of this dilemma in my startup as well.  We end up choosing a path “for now” over what we will “eventually” do. As we all know, the “eventually” never happens! An example could be  B2B vs going Direct to the consumer or an e-commerce company finding themselves in an identity crisis : Am I in a consumer experience business or a in a logistics business?.

If this cannot be explained in simple English with clarity, it is better to go back to basics and start refining the business model;

Keep asking the questions; Mentors and other startups play a very crucial role in unraveling and validating the business model. As entrepreneurs we either take it for granted or don’t see it all.

Competitive landscape: Who else is working on this problem already?

Ths is one of my pet peeves –  Entrepreneurs tend to have a tunnel vision and do not look around for existing players in their own problem domain. Time and again, I find the entrepreneurs with no knowledge of other startups or product companies who may be doing exactly the same thing or something complimentary in their respective areas be it in India or outside.  Going back to my first comment on problem definition, they would either have a cognitive dissonance or try to portray it as we do this as well as that but that company is not focusing on what we do.

While we as entrepreneurs need to be obsessive and passionate about what we do, we also have to be equally paranoid about what else is happening in our own domain. There is nothing called “Blue ocean” in our times I guess! Someone in the team must be thinking 24×7 about what else is happening in their area and at times it is perfectly normal to be cynical I guess! J

Production positioning: How does our product fit in the marketplace?

As startups, we focus on the here-and-now when building our products, we miss out on how we can be part of an eco-system of connected products / apps.

It means intense research, trying out different apps, looking at product features of others more closely etc. It is worth the effort to look at the landscape and eco-system , understand the product fitment holistically.

It is better to ask (or get asked) some real tough questions around where do we add value to the eco-system, how does our product fit in the existing scheme of things, why would customers pay to buy our product and what is one thing which makes them use our product etc.. during the initial stages of the product development stage.

There is a huge opportunity to look at product positioning and marketing (similar to how Lean Startup approach evangelizes) along with the product development and engineering.

Revenue model and product marketing are two areas I have still not touched upon in this article. Hope to cover it sometime later!

Reduce Data – Programmatic Advertising Platform

Reduce Data is a programmatic advertising platform. Reduce Data helps advertisers buy media efficiently using programmatic means – machine learning, real-time data driven optimization and real-time bidding. Asif Ali is the founder of Reduce Data.Asif has over 15 years of technology experience. He previously ran ZestADZ, a mobile ad network (acquired by Komli in 2011). ZestADZ was a global mobile ad network with presence and advertisers in over 25 countries. Before that, Asif was the CTO / Co-founder of a wireless and enterprise startup – Threesixty Technologies Sdn Bhd, in Kuala Lumpur, Malaysia. ThreeSixty maintained app stores on Carriers, built and rolled out mobile commerce solutions such as prepaid SMS topup solutions and had the top 2 telcos – Maxis, Celcom, Top banks – Public bank and Ministry of Education, Malaysia as its customers. The current team strength I s about 15 with 4 people in US, rest of the team is in India. The team is roughly 40% sales, 40% engineering and 20% operations.

The Company

Reduce Data is an early-stage company offering a programmatic advertising platform. They pivoted recently from being an analytics-focused company to a company that offers an integrated platform for media buying and analytics.

Asif says the idea came about in his last ad network, where he found advertisers unable to effectively measure and optimize ad campaigns across various networks. The scale and size of data that was being generated in advertising was huge and there were very few platforms addressing this scale to drive efficiencies. It is also estimated that nearly 30% of media spends are wasted. Reduce Data was started as an attempt to solve this problem.

Reduce Data is what is called as a Display Advertising Platform. Display Advertising Platforms typically focus on Banner Advertising as opposed to delivering text ads within search results (like the way Google does) – see understanding display advertising for a simple view of the display advertising platform and marketplace.

Any company that needs to buy advertising typically buys media from various platforms (this varies, depending upon their goals). Display advertising is one such kind of platform where media can be bought.

Let’s say if Flipkart wants to buy media to promote its new tablets-only store.

  1. They will sign up with Reduce Data
  2. Either through self-service or with the help of Reduce Data’s team, they will identify and select the right target audience and segment of traffic (for example – Male / Females, aged 25 and above in urban centers only and those who are available within a list of top 10 cities)
  3. Assuming that such audience information is available, Reduce Data’s team will make that available and kick start the campaign.

When a user visits a web page

  1. The publisher (like Times of India) auto requests the ad exchange for an ad
  2. Ad exchange will in turn send this request to Reduce Data and various other buyers to ask them whether they want to buy the user.
  3. Reduce Data, will check whether it has relevant information about the user.
  4. Reduce Data’s machine learning algorithms predict whether the user can be bought and if so at what price.
  5. Assuming that Reduce Data wants to buy the user on Flipkart’s behalf and assuming that this user belongs to the right target audience that Flipkart wants, it will bid and either win or lose the auction.
  6. On a win in the auction, the Flipkart ad is shown to the user.

This automated auction called Real-time Bidding (RTB). This entire process 1,2 and 3 happens in 1/10th of a second.

The Product

Reduce Data provides the best of programmatic and a measurement platform in a single platform to its customers (advertisers and ad agencies). The programmatic ad platform allows them to display ads for their clients on a large number of publishers’ sites, and for the most targeted set of audiences. The measurement platform allows their clients to analyze the impact of their campaigns and make the most efficient utilization of their ad budget. Such an integrated platform allows them to offer a low-cost, integrated solution to its customers.

Some of the features of the platform are:

  1. Programmatic Buying capabilities: Reduce Data is focussed on delivering ROI by leveraging superior programmatic approaches.
  2. Measurement and Programmatic in a single Platform: Advertisers using Reduce Data can leverage Reduce Data’s analytics to measure advertising spends through the same platform they use to purchase ad space.
  3. Rich Media and Video Campaigns: Reduce Data allows video campaigns to be run in addition to other media-rich ad campaigns such as MRAID-compatible (a mobile rich media standard) HTML5 mobile campaigns.
  4. Web and Mobile Advertising: Allows brand advertisers to reach both web and mobile users using a single platform.
  5. Retargeting: Re-targeting enables advertisers to follow the user after a visit to a website. This approach generally enables better conversions and improves ROI for the advertisers.
  6. Audience Segmentation: Reduce Data has partnership with three data providers to enable delivery of highly segmented audiences (available currently for US and UK, more international data providers are being added).
  7. Self Service Console: Reduce Data enables self-service advertising through an easy-to-use, self-service user interface to manage the campaigns and check its effectiveness.

Technology

Core of Reduce Data is a technology platform that participates in Real-Time Bidding as a Demand Side Platform(DSP). Given the fact that the real-time bidding protocol is run across these players for every visit to a site, the turnaround time from a DSP has very stringent requirements. Typically, an Ad exchange expects the response from a DSP within 100 milliseconds; including network latency (turnaround time includes time taken to process the bid request, and time taken for the message to travel from exchange to DSP and back). Hence there are 2 technology challenges they need to solve:

  1. Low response time: The time taken to process the bid request by Reduce Data software has to be very small. Reduce Data currently can process a request in 4-6 milliseconds.
  2. Low network latency: The time taken for roundtrip between Ad Exchange server and Reduce Data server. Hence the location of the servers matter. They have tried to use Amazon Cloud, but aren’t happy with the costs and latencies, and are deploying datacenter infrastructure close to the supply side partners and exchanges.

Differentiators

This is a highly competitive market and many of the features they offer are standard features offered by lots of players. A few features that differentiate them from rest of their competition are:

  1. Measurement Tools: Reduce Data provides an integrated platform which very few players offer. However, integrated doesn’t mean reduced set of features –Reduce Data offers full blown real-time reporting that enables advertisers to effectively measure and optimize their ad spends without having to use a third party platform.
  2. Superior programmatic technology + big data driven optimization
    1. Real-time machine learning systems with various algorithms for various needs
    2. Big data technology driven real-time data processing / analysis capability which is extensively used in the feedback loop to drive highly optimized ad spends

Market

According to EMarketer’s latest forecast, RTB (Real-time bidding, the programmatic advertising) portion of digital display ad spending is steadily increasing, from 8% in 2011 to 19% in 2013, and projected to be around 29% in 2017 – $8.49 billion – a huge opportunity.

Reduce Data has a dedicated Sales team, and even though they have launched very recently, they see 15-16 leads a week, and all their current clients are paying ones. They expect to reach $2-3M revenue within next 12 months.

Building Credibility

They need to build credibility in the market that is filled with competition. To ensure that brand gets built quickly, Asif has moved to US, and is focused on marketing Reduce Data. Through tech meetups, publishing whitepapers, speaking engagements, getting published in print media, and of course by delivering good value to his clients, he hopes to build Reduce Data into a credible player in this space.

India offering

They recently launched an India offering too. This is a smart move from them because this helps them to position themselves as a big player in this space which has presence in multiple countries. India being an important market, some exchanges like Facebook Ad Exchange, tend to give preference to companies that have India presence when they let DSPs connect.

Future releases of their platform are likely to focus extensively on improving algorithmic and data processing capabilities.

Competitive Landscape

This is a highly competitive market. There are a large number of very well-known DSP in the market: Adroll, Dataxu, Mediamath, Turn, Google (InviteMedia), AppNexus, Komli Media, etc. Since all of them connect to same Ad exchanges (and hence have the same access to ad inventory) and offer similar functionality, it is hard to distinguish between them. Competition is based on pricing and ease-of-use. Such a crowded space with little differentiation will mean that prices will be squeezed and this will impact new players like Reduce Data.

If we do try, we can see 2 areas of competitive differentiation (other than pricing, of course!):

  1. Inventory access: Though all DSPs aim to connect to all Ad Exchanges, some have better access than others. For example, Facebook hasn’t allowed all DSPs to come on their Exchange, and so it might disadvantage a few DSPs. Similarly, some publishers (too specialized, localized, etc.) may be available only some specialized exchange, and not all DSPs may be connected to them.
  2. Effectiveness of data-based decisions: DSPs use data to make the decision about which impression to bid on. Decisions depend on proprietary algorithms, data available about the user and processing power, and this distinguishes different DSPs.

As the space evolves, vertical integration is a possibility – DSPs getting acquired by (or acquire) upstream or downstream players. Such a consolidation is more imminent as RTB grows at a rapid pace and become critical to display advertising.

The Road Ahead

Display Advertising is undergoing significant changes over last few years, with technology creating never-before opportunities for innovation as well as disruption. Demand-Side Platforms have the potential to make media buying and campaign management extremely effective and provide significant ROI to the advertisers. Reduce Data is in a very competitive space with large and well-known competitors. This industry will evolve along 3 dimensions:

  1. Data-driven decisions: One of the promises of DSP is to offer compelling value using deep data analysis. Reduce Data needs to continue to focus on its machine learning and big-data capabilities.
  2. Tools: Brand safety, Measurement, ROI calculators, more variety of algorithms etc. are keys to interest brand marketers to switch to new platforms and Reduce Data will continue to innovate and rollout various tools as per the needs of the marketplace.
  3. Media focus – DSPs tend to focus either on Video, Online or Mobile and that is going to continue for a while. Reduce Data will eventually need to choose a sweet spot for itself in one media.

One of the things going for Reduce Data is the credentials of its founder: Asif has deep experience in the advertising space from his prior company (which he sold to Komli). Another is the fact that they are an engineering driven organization and are focussed evolving the platform faster than the incumbents in the marketplace.

If they execute well on these dimensions and leverage their technology focus and industry connect, they have a real good chance of becoming a force in this fast-evolving space and carve out a name for themselves.

iSPIRT ProductNation Branding RoundTable: Why Product Branding is important for Startups?

As usual, the 16th iSPIRT RoundTable was a great learning experience. Many thanks to Avinash Raghava & iSPIRT for conceptualizing it, and to Helion Ventures for sponsoring the venue and the snacks.

Dhruv Shenoy of Knowience Consulting, a well-known Marketing Guru, was the facilitator, along with Rajan from Intuit. Thanks, Dhruv and Rajan, for an educational and entertaining session.

I used to think that product branding is only for large companies and startups and early stage companies don’t need to worry about it.  So I was skeptical at first – but I trusted Avinash’s judgment in putting together this session.  And it was an eye-opener.  Dhruv explained to us what “brand” is and why it is important for products at any stage of maturity.  Building the product without doing an exercise in defining the brand can lead to lot of wasted time and money.

Branding consists of three high level activities “What to say”, “How to say” and “How do we reach the target customer”.  This round table focused on “What to say”. Future round tables will cover the other two high level activities.

Starting with the definition of “Brand”, we covered “Customer Insights”, “Product Proposition”, “Target Audience”, “The Six Tenets of Product Branding”, “Brand Essence” and “Brand Positioning Statement”.

After reading this article, give a shot at creating a Brand Positioning Statement for your product.  From my personal experience, I assure you that it is time well spent.

What is a brand?

We normally look at only commercial products, but the concept is broader.  Mother Teresa, Lord Ganesha, Santa Claus are also brands. So are Diwali and Valentines’ day.  Or even the concept of “Brand India”.

The three key attributes of a brand are:

  1. Most Unique (not overlapping with others).
  2. Most Relevant
  3. Large following

For example, among the 33 Crores of Hindu Gods, which God is known for removing obstacles and hence needs to be worshipped first?  Everyone knows it is Ganesha. Ganesha satisfies all the three conditions above.

Brand is how consumers identify the product and recall it. Brand is built over a period of time by the consumers/target audience.  The manufacturers can do brand building activities keeping the above three attributes in mind. Brand building takes time. For example, Gmail built it over several years to overtake Yahoo.

To be successful, the product should not be a commodity. It should be a brand. For example, rice is a commodity and is talked in terms of Rs. 43/kg or Rs 50/kg. But Kohinoor Basmati is a brand.   A brand kindles attributes about the product in the mind of the consumer.

Brand creates a promise. This needs to be delivered by the product. Otherwise, it will backfire badly.

So how do we go about creating a brand for our product?  The first step is to get customer insights.

Customer Insights 

It is very important to realize that there are thousands of things going on in the customer’s mind.  How do we get into the mind of the customer and grab mindshare?  Even if you have a great product, if the customer cannot identify and recall it, you have lost the customer.

To understand how to get the customer’s mindshare, we need to get customer insights. Customer insights are at a deeper level and not just at the level of product benefits/features.  These deeper insights should be used to differentiate your product and get the customer’s mindshare. 

Here are some examples of customer insights:

(Disclaimer: All the statements about different brands and products in this article are hypotheses made by RT participants as an exercise for better understanding.  They may not reflect reality)

  • SalesForce:  Before SalesForce, companies had to make large investments in Software and have it installed and maintained on premise. This was keeping SMEs away from expensive Software. They could not afford to make such investments to see value. Subscription based, on-cloud service appeals to this customer segment.  SalesForce targeted this customer insight.
  • Dove: As women get into early 30s, they have the insecurity that they are looking older.  Dove promises that they will look younger.
  • LinkedIn: Man is a social animal and wants to keep in touch with his contacts.  In the offline world, the mindshare of friends (whom you meet at home in a relaxed environment) is different from mindshare of professional contacts (whom you meet in a coffee shop with some agenda).  LinkedIn’s insight was that what you do offline (meeting people, networking etc), you can do online also in a separate way. Online life mirrors real life.
  • Instagram:  People want to look like professional photographers. People are taking photos from their mobiles and sharing, but the photos were not looking professional.  Instagram lets you do that from your mobile.
  • Scooty: Kinetic Honda is very heavy for young girls.  They need something lighter without gears.
  • Gmail: Other mail providers were limiting the max space. Gmail came up with 10GB space.

Focus on only one thing from the customer mindshare point of view.  Which part of the customer’s problem are we solving? Focus on the deeper benefit.  David Ogilvy said “Interrogate your product till it confesses its strengths”.  What can my product do that others can’t? Without this, your brand will not have recall value.

If we have multiple product lines, then we should have a main mother brand (e.g. Microsoft) and the sub brands for individual product lines (e.g. MS Office).

Study the market dynamics and focus on customer insights.

  1. Customer Insights should be the foundation of business planning.
  2. Remember that customer attitudes are never static.
  3. Customer insights are the key to building a discriminator.

How do we go about getting customer insights?

  1. Usage.  This is the best way – find out how the customer is using your product and take feedback.
  2. Observation.  For example:  shopping insights, product usage analytics, surveys, research.
  3. Probe. Ask open ended and close ended questions and analyze responses.

The best way to get consumer insights is to go back to the people who are using your product and find out why they are using it.  This will also give you insights on your product differentiation.

Ask customer to describe your product.  It can illuminate you on what you think your customer thinks (apologies for the thought twister).

Once you’ve got the customer insights, the next step is figure out which insight you want to target.  And that brings us to “Product Proposition”.

Product Proposition 

How will my product be different with respect to the competition?

  1. Filters down from consumer insights.
  2. Discrimination starts with the product.
  3. Brand builds on product promise.

Here are some examples:

  • iPod: iTunes + iPod. Buy one song instead of an album. Biggest storage capacity.
  • Nissan Sunny:  More legroom for people sitting in the back seat. Longer car in the same category (i.e. at Sedan cost).
  • Google:  With earlier search engines, you had to think what to type. Google addressed this with “Search the way you think”.
  • Flipkart: Hassle free delivery.  Very fast.
  • Maruti Car:  How much mileage? Value for money.

It is very important to be unique on some dimension – even from the day you conceptualize the product.  And, the product proposition has to be very simple to have recall in the customer’s mind.  One rule of thumb is to aim to explain your product to your child/grandmother.  Typically, this can be done.

Think of what is keeping your customers awake at night.  And use that to grab the customer’s mindshare. For example, let’s take my company’s product – KeyMails – which solves the problem of email overload for Microsoft Outlook users. The insight could be that the target customer is worried about missing an important mail. So, something like “Never miss an important mail” could be one approach to branding.

Think in terms of “Unique Atomic Unit” about your differentiator.  For example, with facebook it is “update status”; with twitter, it is “very short message”.  Spend some time thinking about what the unique atomic unit is for your product.  Do it now.

Go to market with the differentiating “hero” feature.  Other features are needed, but they do not form part of go to market strategy.  Example, Scooty is a vehicle that has good mileage and a good engine, but they focus on their differentiating factor of being usable by girls.

Once you have the product proposition, the next step is to understand the target audience.

Target Audience

You need to have answers to the following questions about your target audience:

  1. Why should we understand the target audience?
  2. Who are we talking to? And why?
  3. What are his/her attitudes to the category?
  4. What defines him/her?

For example, for Naukri, the recruiter thinks he needs their service if he needs to hire 200 people in a month. If it is just for one or two positions, consultants might work better. This customer attitude is important to know.  Online recruitment is for scaling.

You need to create a persona for the target customer. In the initial stages of a startup, it is better to have only one target persona.  Having multiple target personas causes confusion.  Pick the persona that is most promising.  The persona needs to change and be refined as you get more data.  For example, though Practo is a general purpose solution for doctors, they first picked dentists and later expanded to other segments. “Everybody is my customer” does not work.

Give the target persona a name – say Molly/Tom/Rohan and write down as many attributes as you can about the persona – what is the annual salary, spending habits, attitude towards buying products similar to yours etc. This helps in identifying who is a target customer and who is not. This will also help in decision making – for example, if you want to add a feature – ask if Rohan will like that feature. And base your decision on the answer to this question.

You can have multiple target personas once you become more mature.

What if there are multiple people who are involved in the buying decision for the product? Who should you focus on? Your pitch should be to the buyer. You have to talk to the users and the influencers too, but the pitch must be to the buyer.

With this background, it is time to introduce the six tenets of product branding.  This is a concise summary of the discussion so far.

Six Tenets of Product Branding

You need to study and arrive at your understanding of the following six pillars.

  1. Market Dynamics
  2. Target Audience
  3. Consumer Insights
  4. Competitive Environment
  5. Key Brand Benefit.
  6. Reason to Believe.

If even one of the above is not satisfied, you might not get the results. For example, one of the most common reasons for failure is that brands do not address the “Reason to Believe”. It is easy to make tall claims, but the consumers must clearly see the reason why they should believe your product’s differentiator.

All the learning above are inputs to two tangible outcomes for your brand – (a) Brand Positioning Essence and (b) Brand Positioning Statement.

Brand Positioning Essence 

“Brand Positioning Essence” typically consists of two to three words.  It is that one aspiration of the core target audience that the brand would like to uniquely own.  For example, “Feminity Restored” can be the essence for a soap targeting middle age women.

Take a few minutes now to think about those two or three words that communicate the essence of your product.

Brand Positioning Statement

Create a Unique Brand Positioning Statement that covers the six tenets above.  A template for your statement is given below:

My product is a ________ (market dynamics) for ______ (target audience) who are ______ (consumer insights) and my product does _________ (key brand benefit) because ____ (reason to believe).

Here is a shot at KeyMails brand positioning statement.

“KeyMails solves the problem of email overload for business people who use Microsoft Outlook, and who do not want to miss important mails; by ranking the mails in the order of importance to the user, by automatically learning from the past email behaviour and easy and minimal configuration.” 

I request other participants to write down their unique positioning statement for the benefit of the readers.

For your reference, here is the silde deck used by Dhruv for the round table.

Conclusion

Branding is a must for any product, whether it is in a mature stage or early stage.

Particularly for product startups, the “brand” of the product is important. It is more challenging when the product is still evolving and the startup is trying to figure out the product-market fit and a minimum viable product.  However, brand is in the mind of the customer and it is evolving. It can change with product market fit, but it has to be present at every time.  You always need to have a differentiating factor that addresses a deep need for your target audience.  And your brand positioning can and must change as you change product strategy.

It is similar to your business model.  It is not advisable to start building a product without having a business model and business plan.  Sure, it will change and evolve over time – but at any point in time, you do have a business plan.  Same thing with branding.

If you’d like to share your knowledge on product branding, please do write them in the comments section.

Tweetable Tweets

Branding is as important to startups as it is for mature products. Tweet this.

Brand creates a promise. This needs to be delivered by the product. Otherwise, it will backfire badly. Tweet this.

Thousands of things are going on inside the customer’s head. How do you get mindshare for your product? Tweet this.

Even if you have a great product, if the customer cannot identify and recall it, you have lost the customer. Tweet this.

Customer insights are at a deeper level and not just at the level of product benefits/features. Tweet this.

Focus on only one thing in the customer’s mindshare. Without this, your brand will not have recall value. Tweet this.

The best way to get consumer insights is by asking people who are using your product why they are using it. Tweet this.

Ask your customer to describe your product.  It can illuminate you on what you think your customer thinks. Tweet this.

Go to market with the differentiating “hero” feature.Tweet this.

Create a persona for your target customer. Give a name like Tom and write down Tom’s attitudes. Tweet this.

Brand positioning essence is two or three words that you’d like to own in the customer’s mind. Tweet this.

Create a brand positioning statement addressing the six tenets of product branding. Tweet this.

Emotionalizing the software products… uh…what?

I recently delivered a workshop on building winning products. The audience identified that it was important the customers loved a product in order for it to be a winner. It also came up that consumers increasingly want to buy things that thrill and delight in addition to simply doing what they were designed to do. Today, things around us from Gillette razors to Apple devices exude desirability and emotionally engage consumers. People look at their possessions as a means to provide them self-expression and extend their personality. They also crave for great experience in the journey of whatever problem they are trying to solve. They find the mere discreet functions and features unexciting.

The new focus on emotional experience is consistent with the psychological research that confirms that people value emotional experiences more than even the product functionality. Statements like this from users, “there is shortcoming in my iPhone, but still I love it”, are commonly heard now-a-days. Indeed, “Form follows function” has given was to the more emotion led approach to design: “Feeling follows form.”

Why build emotional connect

Technology people live in a rational world and they think the rest of the world too. This is however, far from truth. Emotions drive peoples’ attitudes and behaviors. Rational thought can lead customers to being interested in the product and be happy with tangible gains from its functionality. However, it is emotions that drive customers’ desire to own the product, pay any premium and recommend it to their friends. Emotional engagement promotes loyalty and revenue growth thru word-of-mouth. There is a proven ROI in emotionalizing software.

How does this impact software? Well the software is becoming an ever growing component of the plethora of devices and services that proliferate around at home, workplace and other places. This means software has enormous possibilities for creating emotional experiences for the consumers. It makes it imperative that software developers fulfill this consumer expectation.

How to build emotional connect and satisfaction

People think about and experience life through a set of deep rooted metaphors. The metaphors help them make sense of the plethora of experiences through these metaphoric lenses.  Emotional experiences happen thru the five senses – vision, hearing, smell, taste, and touch. Software products and services are abstract in nature. Unlike other products (devices, autos, homes etc.) they can mostly leverage only vision and hearing for the emotional experience.

Keeping the challenges in mind, here is a set of steps that the author found useful in this endeavor.

  1. Develop customer empathy to gain deeper understanding of the customer, their needs, wants, deep desires and values.
  2. Understand that people respond to feelings, remember stories, and take actions based on deep rooted metaphors. Therefore
    1. Identify metaphors people live by. Metaphors vary by culture. Metaphors change with time.
    2. Use metaphors to create the symbols, icons, colors, texts, workflows etc.in interaction design.
    3. Use storytelling techniques in internal and external product communication like product vision, requirements, specifications, prototypes, press releases, product positioning statements, tag lines, advertisements and documentation.
    4. Keep customers and their pain points and value props alive thru the product development where daily engineering and feature decisions can easily lead to overlooking who the customers were and what they wanted.
    5. During product development
      1. Personify user / customer during software development. Use personas.
      2. Build not features but complete scenarios of customer problem solving.
      3. While making engineering / business decisions constantly ask – will that persona like the change? Does the decision breaks down any end-to-end scenario?
      4. Post product development
        1. Create emotional connect at every touch point like sales transaction, support and upgrades.

We shall delve deeper into each of these steps in forthcoming blogs.

iSPIRT Playbook Roundtable: Positioning and Messaging – Lot of it is common sense!

If your grandmother does not understand your message, then you might as well not communicate is the crux of what was discussed during this Roundtable facilitated by Shankar Maruwada and Nandita Sinha.

This roundtable discussed the ‘What’ of the positioning and messaging and not the ‘how’ of the positioning. There was very little theory except perhaps setting the context and the entire session was practical.

To illustrate the significance of positioning and messaging, one of the participating companies gave an elevator pitch thinking the rest of us are his prospective customers. Then people spoke about what stuck in their minds about the pitch. It varied from ‘I lost him’ to ‘I was thinking of a completely different business model’. The person who gave the pitch looked at all the responses to understand if there were any surprises and what needs to be the part of their messaging.

Discussion on the first pitch led to the understanding of the following:

  1. The curse of knowledge forms a part of all the messaging – what is easily understandable for us is not understandable for the market.
  2. Often times, people start to have internal chatters – they start to think even before the pitch is complete and the attention span is just about 30 seconds.
  3. Most messaging is at a conceptual level and addresses the left-brain of their audience, which does not persuade people to make decisions. Try addressing to their emotions, their right brain and the easiest way is to do these through stories.

Using the first pitch as an example, Shankar explained what goes into creating a tight message and it was

  • Identify the customer segment. You can have one overall messaging of your offering and can have multiple messages for multiple segments
  • Setup is the context of your offering. It can be some challenges that your customer segment faces or the industry faces. There can be multiple setups to your messaging
  • Explain the benefits of your solution. How your offering is unique to the customers need will be the persuasive part of your pitch. Setup combined with benefits is what would make the message that you communicate
  • Features and supporting credibility will have to come after this phase of setup and benefits

After this, one more exercise was carried out where all the participating companies were asked to write down 3 setups and 3 benefits while avoiding features. All the pitches were discussed at length and I am sure all those who attended the Roundtable went back a lot wiser about messaging.

Shankar emphasized on a very important fact that you may not crack your messaging in one sitting and it has to be an iterative process. He also asked people not to think in words and instead begin with stories, then move on to thoughts and then switch to words. This is the best way in which you will get to do your messaging right.

This Roundtable was attended by 9 companies with 12 participants and 2 facilitators. This roundtable kicked off to a hilarious start, during the introductions most people in the room claimed that their Saturday night favorite drink was either butter milk, tea or coffee.

I am looking forward to more such sessions.

Product positioning and sales strategy must be approached the way an army fights a war

To position the product, you must first have clarity on the addressable market and its breakdown in terms of different industries or user communities (let’s call both of them as ‘verticals’ for simplicity). Then analyze which of them can benefit the most from your product, where your maximum contacts are, and which has the least competition.

You can accordingly initiate preliminary sales efforts with well-known contacts in verticals that appear to have the best potential. Initial sales in a start-up are opportunistic—you take the business that you get. Yet, over time, you can only gain by firming up your target client base and tailoring your product to them.

Product positioning and sales strategy must be approached the way an army fights a war. It may not be easily apparent which verticals to focus on. In similar situations, armies launch probing attacks to detect weak lines of defence, before deciding on the exact battle plan. Founders can test the market with different customers, who would help them to develop insight into which industries, user communities or geographies have the best potential.

Once weak links are identified, choose initial battles to be on your terms. In the 1971 war, the Indian army avoided enemy troops that were concentrated in cities in East Bengal. They quickly captured the countryside, surrounded the towns, until the enemy surrendered. Similarly, a start-up must spend its limited sales budget to target the right customers.

Positioning and sales are influenced by different factors, some of which are listed below:

Target Market

  • Your product may have the potential to solve similar set of problems for different verticals. However, limited finances will stop you from ad- dressing all of them. Focusing on one or two verticals can result in a more specific solution, thereby increasing total value delivered by the product. This improves the probability of converting opportunities to sales.
  • The best target segments are not necessarily the obvious ones. For example, a vertical may be large but should be ruled out if it has entrenched competitors, less appetite for IT products, remote location etc.
  • Conduct some research by talking to potential clients in various verti- cals, industry experts and reviewing market surveys.
  • Sometimes, you may simply stumble on the right vertical. Initial clients provide the momentum and knowledge base related to a particular industry segment.

Delivery Model  

  • Sales strategy depends on the kind of product: enterprise software for companies, consumer software, web downloads, hosted solution (SaaS) with subscription fee, or an ad-based ‘free’ web portal.
  • Your product may support more than one delivery model. Thus, vendors may target big companies with full-blown enterprise software, while providing a SaaS version for SMBs. Many companies offer a free downloadable ‘lite’ version of the product, which can be upgraded to a paid full version. A free website may charge a subscription fee for advanced capabilities or special content. 

Initial Support

  • Does your product work out of the box with almost no support? Or does it need some customization and training? Is the product serving an obvious need, or does it require substantial education before a client decides to buy the product? The answers will influence the sales model.  

Geography

  • Is your product specific to India or global in scope? Even if global, do you plan to sell in India first? Does your city and region have sufficient opportunities to sell the product?
  • Except with SaaS, targeting and supporting customers outside India can be very expensive. It is best to follow an ‘expanding universe’ model, where initial focus is in your immediate area, followed by proximate locations, and then a global market.

Product positioning is closely tied to licensing model and pricing. We will consider each one individually.