Combine These Two Advanced Positioning Strategies to Successfully Market a Disruptive Businesses

Most companies dream of being the first product to their market, with no competition to speak of. This is especially true in the rapidly progressing field of technology, where the moment a new company shows even the tiniest hint of success a plethora of copycats appears seemingly overnight. However, in his book Crossing the Chasm, Geoffrey Moore shows that, in order for a disruptive new product to successfully cross over from the early market of Visionaries (or “Early Adopters”) to the mainstream market of Pragmatists (or the “Early Majority”), a company needs to do something that seems counter-intuitive — create competition for their product.

Your initial reaction to this is probably disbelief. You’re thinking that having a monopoly on the market by being the only viable company in your category is the most lucrative place to be. And if you were talking about an established mainstream market you’d be correct. The problem is that when you are launching a new disruptive product to the masses, you are asking large, risk-averse organizations to change how they operate, and this isn’t something they do lightly.

The mainstream market wants to buy from the leading company in a market that is established and mostly stable. They’re not looking to try all of the latest gadgets hoping to get lucky and find one that helps them solve a critical business problem. Mainstream buyers want to have confidence and reassurance in the products they purchase, especially new ones, and if you don’t have any competition then to the Pragmatist buyer the market for your product will appear immature, risky, and it will be difficult for them to trust that your business will last. Prospects who don’t feel optimistic about the rewards their organization will get from buying into your new disruptive product or service won’t write checks to your company, they will wait for the market to mature before deciding to make a purchase.

The key to successfully crossing into the mainstream market with a disruptive product or service is using two advanced positioning strategies to referencing existing companies and technologies in order to contextualize your marketing efforts and reassure the more conservative mainstream buyer that you’re offering a legitimate solution to their problems.  The two positioning strategies are called a “Product Alternative” and a “Market Alternative.”

The Market Alternative is where you paint your product or service as a solution to the prospect’s problems in a given area. If you’re trying to sell the first computer-based word processors, then the market alternative would be typewriters. You would try to use the terms, expectations, and branding for typewriters to define and differentiate computer-based word processors. Using the Market Alternative provides context and allows your product to stand out by highlighting where it is superior to the older technology (You mean I can delete something when I make a mistake?! Awesome!), while not overwhelming the prospect with an entirely new set of terms, images, and experiences.

Another way to think about it is which budget for existing products or services you’re trying to capture from your prospects. Continuing with the word processor example, you’d be trying to get your prospect to spend whatever money they would have budgeted for a new typewriter on a word processor instead, therefore that is your Market Alternative.

The Product Alternative is where you position yourself as the market leader for your category of new disruptive technology. You show that, of all the different brands selling computer-based word processors, your particular product is the best choice for the prospect. This is where, if you’re Microsoft, you highlight all the ways Word is superior to Corel’s WordPerfect.

Developing the Product Alternative is more familiar to most businesses, where their primary strategy is trying to attract customers simply by outperforming the benchmark set by the leading company in their field. However this approach alone is not enough. Without setting up a Market Alternative first, your prospects won’t see a reason to change over from the technology they’re currently using. Just like our post about selling benefits before features said, in order to make the sale first you have to make your target audience understand why they need your product at all, and why it’s better than just continuing to do what is working well for them now. If they don’t feel that their current situation needs to be improved, you won’t have much success selling to them.

After you’ve made them realize the potential upside to changing to your new disruptive technology, presenting the Product Alternative will help you reinforce that investing in a product like yours has a large upside. By showing you have competition it makes your prospects believe that you are part of a maturing market and not a passing fad. And finally, once they’ve committed to themselves to buy a product from your category, the Product Alternative also helps them see that your brand is the best choice in the category and they will buy from you.

Tell us what the Product and Market Alternatives are for your business, and how you can position yourself using these terms, in the comments!