Market Point of View: Do You Have One?

03/08/2011

One thing that I believe that startups can do pre-launch to market themselves is to start talking about the problem (in a broad sense) that they intend to solve and their “point of view” about a market.  Being able to articulate a point of view about a market is a good starting point for building your messaging so I thought it would be work diving into this more in a post.

What is a Market Point of View?

A market point of view is essentially your philosophy on how a market should best be served. It’s the big picture idea that underlies why your product is different (and better) from what is out in the market today. Prospects that share your point of view about how a market’s challenges are best solved will clearly understand the value that you deliver with your product.

Here are some examples of differing points of view about a market:

Best of breed vs. integrated one size fits all – At several of the companies I’ve worked at this was our main difference in philosophy about the market.  We were up against large competitors that offered tightly integrated solutions with functionality that spanned several markets.  There were obvious benefits for customers that wanted all of the pieces and preferred dealing with a single vendor for the whole solution stack.  Our point of view however, was that some customers would be better served by a more narrow offering that did only one thing but did it very well. We noticed that some customers didn’t need the breadth of functionality our competitors offered and were wary of having so much of their infrastructure locked in with one vendor. While our competitors were going broader and broader with their feature set across markets, we were going deeper and deeper with products that served individual markets in the best way possible. It was exactly this point of view that clearly differentiated us from our competitors and made us successful.

More is more vs. radical simplicity – You see these two philosophies play out in mature markets often. More mature products will add more and more features to offer prospects the most feature-complete solution possible. Of course this richness generally comes with a price in terms of added complexity. It’s at this point in a market where you will start to see competitors popping up that have a point of view that simplicity trumps bells and whistles.

High volume/low price vs. amazing customer service – Most online retail businesses have traditionally been about selling as much as possible for as little as possible. Zappos has proven that an online retail business that focuses primarily on customer service can also be wildly successful. When they first began talking about this point of view, it wasn’t obvious that customers would potentially pay more for customer service. Sure their competitors were serving their customers but it wasn’t a core part of how they defined their business. After Zappos proved that a business could be successful with this philosophy, other businesses in other markets began to follow their model.

Startups get to Start with a Clean Slate

This is, interestingly, the stuff that mission statements should be made of.  Unfortunately most mission statements are nothing more than meaningless, generic fluff about something the company wishes they were rather than an articulation of an underlying corporate philosophy that guides how they approach their market today.  It’s one thing to adopt a tagline that says you are customer-oriented, but quite another to build, grow and manage your business that way.

In this respect, startups have a massive advantage over larger companies. Established companies have philosophies are set in stone over years of operations. Many have had their point of view watered down or twisted by rotating sets of senior management to the point where often they don’t really have one or have so many different ones, it doesn’t matter.  Changing what a company stands for in any real way is a massive undertaking and in my opinion, almost impossible.

Startups on the other hand have the benefit of learning from everyone that has come before them and starting with a clean slate. Who are we? Why should we exist? What type of customers would we like to serve?  Every possible option is available. The answers to these questions can be developed and tested long before you have a company or a product to launch. Is there another, fundamentally different way to solve a particular problem in your market? What types of customers would want a product that does that? How valuable would that be to prospects? How might it be feasible to create a product and/or a company that way?  The best way to test your point of view is to let it lose on the market and see how the market reacts.