Positioning and Differentiation Strategy

Why ending positioning at "wordsmithing" leads to failure

Plenty of teams think of positioning as a matter of the tagline or the hero copy on the website. But the work of polishing words is merely the final step of the decision that is positioning. What should be decided before that is the fact of whose product, and what, yours is being compared against.

If you skip this order and start from copywriting, you get a situation where sales talks by comparing against competitor A, marketing runs ads from a different angle, and the product team builds features assuming yet another customer profile. Each department may not be saying anything wrong, yet the company has no consistent stance as a whole.

Segment, competitive alternatives, unique value — the three elements that make up positioning

In the framing proposed by product marketer April Dunford, positioning begins with identifying the optimal customer segment. Working from the premise that no positioning resonates with every customer, you first narrow down to the customer profile where your strengths stand out most.

What you consider next is the competitive alternatives. The alternative here does not refer only to rival companies' products. Viewed through the lens of "what the customer would do if they did not use your product," it is not unusual for manual work in a spreadsheet, or hiring a dedicated staff member, to be the "real competitor." Only once this alternative is clear can you show, within the comparison, where your unique strengths lie. Strengths need to be articulated not as a list of features but as the value those features bring to the customer.

How to assemble a positioning statement

In practice, it is easy to work by fitting the pieces into a template like the one below to create a provisional statement, then reviewing it internally. The following is an illustrative example and does not refer to any real product.

For [target segment],
[product name] is unlike [competitive alternative]
in that, through [unique strength], it delivers [value to the customer].

Example:
For PMs at small and mid-sized firms managing multiple projects across teams in parallel,
this product, unlike tracking progress in a spreadsheet,
cuts the time spent on reporting work through cross-team automatic aggregation.

This statement is not something to use as-is as customer-facing copy; it is a draft for aligning internal decisions. The words for sales materials and the website are then honed anew from here.

Connecting positioning to Go-to-Market and the roadmap

Once positioning is decided, how you choose channels changes. If the competitive alternative is "manual work," a path that lets customers experience the ease of replacement through self-serve from a free trial tends to fit; if the alternative is "an existing contract with a major vendor," you need a sales-led path that approaches the decision-maker directly. This distinction is covered in Go-to-Market strategy and launch in practice.

The same choice ripples into the roadmap. If you are aiming to win switchers from manual work, ease of onboarding and reducing the effort of initial setup become the core of differentiation; if you are aiming to win switchers from a major vendor, security certifications and enterprise-oriented administration features take on priority. How to position positioning within the flow of strategy and roadmap is also organised in The difference between product vision, strategy, and roadmap, and how they connect.

A common mistake — positioning that becomes a feature price list

The most frequently seen mistake is lining up your unique strengths as an enumeration of features. A list of features loses its force the moment a competitor implements the same features, but a strength spoken of as value to the customer does not crumble so easily. Another mistake is taking the target segment too broadly. Positioning that claims to serve every company size and industry tends, as a result, to become words that resonate with no customer at all. That said, narrowing the segment too far creates a different tension — the market becomes too small — so the degree of narrowing needs to be judged together with the stage of the business and its funding situation.

The next step

Positioning is not something you fix once and leave; it is a subject for periodic review as competitors move and your own strengths change. When you review it, interview the sales front line on which alternatives you are actually being compared against, and confirm whether this has drifted from your original assumptions. How to put the connection to the roadmap into practice as a concrete prioritisation procedure is covered in Building a roadmap and prioritisation in practice, so do take a look. For the whole of GTM in practice, see also Go-to-Market strategy and launch in practice.