Why, how, and when to outsource some or all of your marketing function.
BSMS 33 - Why you should narrow your positioning
Mike and Stijn talk about why saying “no” can help you find early success.
Every large company started small. And most started by doing one thing really well, then built more offerings or repositioned as they grew.
While (understandably) founders don’t prefer restrictive positioning, we’re convinced there is a lot of power in building your initial customer base by providing a specialized service for a small & committed audience.
Today we share some of the stories we use in workshops to illustrate this idea, including:
- A bar in New York
- A club in the Netherlands
We’ve discussed finding your niche before a few times: In episode 14, we talked about how big (or small) your niche should be. In episode 15, we discussed how to position yourself within your niche.
If you’re looking for a tactical rundown, check those out after you finish here.
All right, hello. Welcome to episode 33 of B2B SaaS Marketing Snacks. My name is Richard, I work on the product team here at Kalungi and today we're discussing a super important topic. We love to talk about it, we're talking about narrowing down your positioning and finding your niche. Like I said, really important. Every business should wrestle with this. It's especially crucial for businesses who are just starting out. It's much easier to start a company when you've nailed down your positioning and found your niche than to start out as a "everything business". So today, Mike and Stijn are talking about nicheing down and explaining why saying no can oftentimes help you find early success.
They're sharing some stories and examples and covering the topic from a bird's eye view. And before we jump into it, I will say that if you're a fan of the podcast, you might know that we've talked about some similar things on previous episodes before. In episode 14, we talked about how big or small your niche should be, and then in episode 15, we discussed how to position yourself within your niche. Those are some more tactical episodes so if you're looking for a good tactical rundown, check those out, but check it out after you finish this one. So thanks for listening, here's the episode.
Mike, I was driving the other day and I heard the commercial of Video Only. It's this electronic store that has this interesting positioning that they've done for years now, the slogan is Video Only, and it’s interesting because they sell anything. They're just like Best Buy or Walmart, but they choose to position themselves as one thing, right? Video only, even the word choice. And it's interesting, there's many examples like this. There's another commercial from a nonprofit, Kars4kids, right? It's only really focused on people who have a used car that they are thinking of selling or trading in and people who also are interested in maybe providing help for a charity that cares about children, and that's their positioning. And what's interesting in both these scenarios, I don't believe that the organization behind these are doing anything that's unique for... I assume that Kars4kids is a nonprofit that does all kinds of things for children in need, and this commercial is really only one way to get a very specific action from an audience who happens to be triggered by that slogan, the same with this Video Only commercial.
So yeah, let's talk about nailing a niche because I think a lot of our clients, a lot of the people we work with, they make the mistake that they think to position yourself as a niche provider that you cannot do anything else.
Right. There's this difference between your ideal customer profile and your serviceable customer profile and just because you say in everything, in your website, in your materials, all the things that you put out in the world, just because you say that you are the best for a certain group does not mean that you are not also great for other groups. It just means that that's what you're focused on and I think it's a great topic.
You have this story that you share when we run our go-to-market workshops when we first get started with our clients. I might butcher the story, so feel free to jump in and cut me off if that's the case, but it's essentially this bar in New York that was started on the premise of being a bar for other service workers. So for other bartenders, for people who were being waiters and waitresses, and that's how they positioned themselves. So it was kind of like a club for the people who served other people and they built this really massive brand around just that. And what I think is really cool about the story, because you've shared this a few different times in workshops to talk about this idea of nailing a niche, and so I have on a couple of occasions actually looked up that specific bar in New York to see what their branding is today to just grab screenshots or something that we can add into the deck to embellish the story.
You were not just looking for a drink.
No. Yeah, exactly. And what I found is that they don't actually have that positioning anymore. After they built their initial foundation, they expanded out and now they are just a cool bar, and I think that's actually really cool. It's a really cool progression and a really cool story because it's confirmation that you don't have to always stick to what you started with and you should be expanding out, right? There's also the story about Amazon, right? Amazon started as a bookstore only. Amazon is no longer that. They still have this strong marketplace for books, yes, for sure, but they've also built so many other things on top of it, but Amazon does not say we sell books now, right? At some point you evolve out of the niche, but you use the niche to build a beachhead and then you start to see opportunities to build off of it.
And yeah, it's really hard to have that discipline to limit what you say on your website, and I know we have another topic that we're going to go over which is when you add other industries and how you do that and how you present that information, but to limit yourself in the headline of your website to just say one thing, right? We are the accounts payable automation solution for X industry or X user. That can be so powerful just in the beginning to build that trust with a specific user group who might not feel like they're being catered to or that a solution is not purpose built for them. I think that it's super powerful. It's very, very difficult to do because by doing it, you feel like you're chopping off, or you’re restricting the number of people who might consider your service or your product, but I think it's the exact opposite. You're building a strong beachhead of people that fit your product really well.
It is really, really hard to say no to a part of the market or customers who you think are interested in your product but by doing so, you'll just get a much better connection with your audience. They'll trust you more, they'll be more loyal customers. The Amazon example, Mike, I lived in Europe of course before I moved to the US and I remember, it's not that long ago actually, when I wanted to order things from Amazon in Europe, it was almost impossible. You had to go through the German website to get something in the Netherlands and it's part of them just staying laser focused first in being a bookstore, mostly focused on the US or the North American market and only slowly expanding into other market segments.
Your example of the bar in New York: what I love about that example is that you don't need to be a special bar to choose to position yourself like that and I think that is really critical. There are other niche examples, right? I've not bought them yet and I don't think I'd buy them anytime soon, but I've been at least glancing at this new audio speaker brand called Vivid Audio and there's this guy who used to work at Bower Wilkins who designed these fantastic and extremely expensive speakers. And he started the company for himself, but these speakers cost $90,000, Mike, and there's no way I'm ever going to buy them, but there is a market for that, but this company actually decides not to sell anything to anybody else, right? By putting their price point where it is, they're absolutely excluding themselves from servicing other types of clients.
But the bar example, and by the way, I'm from the Netherlands as you know and when I grew up, I actually was a bouncer for a couple of years in a club. So I was one of those employees who needed to work the nights of Friday night, Thursday night, Saturday night. When most other people actually went out and enjoyed themselves, I was working. But then there was a club in the Netherlands in this case that was open on Sundays and actually on Mondays, they were open on Monday night.
And I think the same with the bar in New York, but this club actually was really open to cater to people who could not go out the rest of the week. It was 50 miles from the city where I lived and people drove 50 miles to actually go to that club, people who worked the rest of the week. So that is also a great example of when you have that specific positioning and you're offering an option for an audience that's very much in line with this unique solution that you get people to make a big effort to buy your product, to come to stay with you.
I think the other example that I sometimes use to make this generic marketing turned into niche communication point is when you're a department store like Nordstrom for example, you probably have more options for people to choose from in clothing and shoes et cetera than most other... And that's by the way, their value proposition. We use this example also in the workshop, when you are the parent of a pair of twins, let's say a couple of twin daughters, 14 years old and you're shopping for them and especially when they're even younger, nine years old and you want to make sure that when you buy something for one, you can buy it for the other as well and you have to have two of everything you buy, then there might be a store that says we are specialized in selling clothes for twin teenage daughters.
And if you walk by that store and your other option is to walk into the Nordstrom, you probably will walk into the store that is specialized in that audience. And that doesn't prevent that store from selling other things as well. People can buy one shirt there, they're not obligated to buy two of each but it's just a way to make it clear to your audience that you're for them and that you can in that sense, provide more value. And I think what happens with most of the companies we work with is that once you get to profitability, once you get funding, especially when you get a seed round or a series A funding, you have just so many options to go cater to other audiences and it's very tempting to do so, but unless you're convinced that the niche market that you have already had success with is not big enough for you to keep growing, then it's very lucrative to just stay focused in both your positioning and maybe also in how you really go to market your price levels, et cetera.
Yeah. And on the other side of it, when you're just getting started and you don't have a lot of resources, let's say you're not funded, you don't have the luxury of creating all of the materials, the demos, the content, the messaging, all this stuff for all these different verticals and industries. Really, you have to stay focused on one and just build out from there and then use the success from that one niche to then start expanding out.
Yeah. And we also talk a lot about things like product led growth or user generated content to be great ways to fuel your marketing, your growth, with the help of your audience.
Right? And if you can enroll people who care about the same things you care about, people who are very into a certain topic or a certain type of solution or all have the same problem, then the chances that they will participate in your community, that they will become maybe content generators in the webinars that you host or give you fantastic feedback to help you improve the product, it's much bigger, right? You can build this community that can really help you improve your solution and build your product.