As an entrepreneur, there’s no greater fear than developing a product or service that no one wants and no one is willing to pay for.
That’s why understanding your product and how it fits into the market place is critical, and a well-developed positioning statement will best help you get there.
Cornell University describes a positioning statement as a “concise description of your target market as well as a compelling picture of how you want that market to perceive your brand.” Here are ten great reasons for doing the work necessary to build this foundation for your new business:
10. A positioning statement helps you see your competition clearly. Listing who comprises your competition and how you differ from the various players will help you identify opportunities and focus on what makes your product or service better than anything that already exists in the marketplace.
9. It helps you determine what customer problems your product or service will solve. To have your business be successful, you must understand the benefits your product or service provides to customers so that you can better define your specific place within the market. Don’t overlook asking your team and your friends about their thoughts on this one—they will think of things you may not.
8. It helps you identify your target customer. While we would all like to think that the world will be beating down our doors to access what we offer, there are some people who are going to need your product or service more that others. Thinking through the various customer segments will help you define your target customers and market your product or service, cost effectively, to the “lowest hanging fruit.”
7. It makes you think creatively about what you want your business to accomplish. We all want to make money of course, but what else do you want your product or service to deliver? A greener environment? Cost savings? Thinking through the emotional connection you can have with customers through your product or service will help you further identify and connect with your target audience.
6. It helps you focus. If you try to have your business be everything to everyone, it won’t mean much to anyone. Understanding your core functions is critical.
5. It makes you prioritize. As you start a business, your head will be full of tasks you must accomplish. Developing a positioning statement helps you get your thoughts in order.
4. It helps you start your planning. With priorities in place, planning the tasks necessary to get your venture off the ground is much easier.
3. It makes you think about the industry you are about to enter. Looking at your strengths, weaknesses, competition, target market and other business issues, gives you a 360 degree look at the industry your about to enter and minimizes the challenges you might meet along the way.
2. It helps you fine tune your market fit. Understanding your industry as well as what makes your product or service unique helps you seize your niche in the marketplace.
1. It helps ensure a successful product launch. As A.A. Milne said, “Organizing is what you do before you do something, so that when you do it, it is not all mixed up.” Proper planning prior to a launch can help prevent poor performance.
Okay, there were ten great reasons why you should develop a positioning statement for your new business. For more, watch this video, in which Anita Newton walks you through how to put a positioning statement together: