Hi, I’m James. Thanks for checking out Building Momentum: a newsletter to help startup founders and marketers accelerate SaaS growth through product marketing.
Inbound marketing. Robotic process automation. Customer success. Conversational marketing. Revenue intelligence.
We’ve all heard these categories bounce around, coined by their relevant organizations. Building a category is sexy: take the Play Bigger book, Drift’s meteoric rise in the B2B SaaS discourse, and Andy Raskin’s narrative work as proof.
But most startups worry too much about defining the category they’ll create and eventually win in time, and not enough time thinking about the frame of reference that will give them the upper-hand right now.
What’s the difference?
A category is about coining the ‘new game’ that the ‘winners’ are able to play, that ‘losers’ aren’t.
A frame of reference is the perspective through which a product is positioned
A product can be in a category and have a frame of reference. Hubspot is a marketing automation platform (frame) in the inbound marketing category.
I think early-stage startups can deliver better, quicker results by nailing their frame of reference, instead of contemplating their category design journey.
In this post:
Focus on your frame of reference
April Dunford’s book explains how a frame of reference works with a great example.
Imagine a muffin made from the healthiest ingredients you can find: nuts, wholemeal grains, and all the quinoa/acai/superfoods you can imagine. Let’s call it a diet muffin.
Now imagine two customers:
A young bodybuilder really into their fitness who meticulously plans every meal
A busy middle-aged mum on the go
Both are equally as likely to buy the product – it’s tasty, nutritious, and can help them with their goals and meets their jobs to be done.
But do you think the bodybuilder is likely to buy ‘a diet muffin’? Or are they more likely to purchase a ‘paleo energy snack’?
Conversely – is a busy mum going to feel like a ‘paleo energy snack’ is what she needs? Or does a ‘diet muffin’ resonate much more with her?
How to determine your frame of reference
There are many elements that can determine or influence the frame of reference you use:
Who your customer is
What they search for
What they think they want
Market trends
Competitors, their capabilities and their frames of reference
Analyst research
Here are some tips on how to deduce the most accurate and potentially successful frame of reference for your product.
1. Don’t be obsessed with creating a category
For the majority of startups, it’s highly unlikely you need to create a category in the first place. At least right now.
April Dunford suggests there are three ways to ‘win’ a frame of reference:
Head to head: position to win an existing market
Big fish, small pond: position to win a subsegment of existing market
Create a new game: position to win a category you create
Remember, a market is a group of similar customers with similar characteristics that are looking to solve a similar problem. Markets are not defined by vendors – they are defined by the customer.
If you are competing directly for a customer, go head to head or look to win a niche part of the market. These strategies don’t require the effort involved to design and launch and market a category – you can ride the coattails of a defined market frame of reference already.
If you definitely want and need to own a category, check out my short post on category design.
2. Know your customer
If I’ve said it once, I’ve said it a thousand times.
The literal definition of positioning is “to occupy a space in the mind of the customer”. It is absolutely crucial to understand what else is going on for them, so we can identify the space we can own.
Look beyond the immediate problem area you are solving. Look to the key jobs, pains, gains, and triggers that your personas and stakeholders have. What are their aspirations? What do they really struggle with? What are they accountable for?
Remember, buyer personas are discovered – not created. Talk to your customers and learn not just who they are, but what makes them tick.
3. Focus on value
Value are elements that your customer wants to attain that is useful, worth the effort (cost, time, energy), and urgent.
Let’s use the diet muffin example above.
A bodybuilder does not value diet foods that will help them lose weight. But a bodybuilder does value food that provides increased energy with minimal health impact.
The mum does not value the nutritional benefits of paleo food… but does appreciate a healthy, nutritious snack she can eat whilst out-and-about.
Same product, different value for different customers.
Tune out the tactical and biased internal voices clouding your value messaging judgement, and instead rely on what comes out of your customer’s mouth. Adapt your messaging to their interpretation and beliefs – don’t force your internal product narrative on them.
Even successful category creation relies on the same principles. Category creation must recognize, name, and define an emerging belief and practice that already exists. Gainsight recognized the customer success approach, and coined it. Drift did the same with conversational marketing… but may not be so successful with its new ‘revenue acceleration’ approach.
Nothing lasts forever
We’re not writing the Hitchhiker’s Guide To The Galaxy; the answer to life, the universe, and everything cannot be summed up in two digits.
As you learn more about your customer and the market, and as your product and competitors adapt, your frame of reference is going to evolve. Today you might be an ecommerce customer service helpdesk; tomorrow, a DTC customer happiness solution.
Revisit your positioning regularly – every six months. Test and iterate with your ear to the ground – don’t just make big internal assumptions. Be led by your customers.
The goal of defining the frame of reference for your product – whether entering an existing category or designing a new one – is to build momentum. A successful frame of reference allows you to focus your message for an audience, and build confidence in your execution.
And, if you’re a regular reader you’ll know that focus + confidence = momentum.
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