In physics, the position of an object determines everything about its interaction with the world around it. A satellite in low orbit moves differently than one in high orbit. A boulder at the mountain’s peak has different potential energy than one resting in the valley. Position, in physical terms, establishes the conditions under which all future events unfold.
In commerce, positioning works similarly: where you place your business in the competitive landscape fundamentally determines how customers perceive you, which rivals you confront, and what gravitational forces you can feasibly exert. Your company’s essence—that distinctive spirit we explored previously—remains potential energy until properly positioned.
This positioning challenge resembles the strategic thinking behind real estate development. A brilliant architectural design (representing your company’s essence) requires the right location to achieve its full potential. Place a luxury boutique hotel in an industrial zone, and its elegance goes unappreciated. Position it in a vibrant cultural district or scenic overlook, and suddenly its value multiplies. The same building, with identical features, becomes transformatively more valuable through proper positioning.
With a clear essence established, the next critical challenge is translating that internal spirit into an external position that customers can readily understand and value.
April Dunford, whose work “Obviously Awesome” has revolutionised positioning for modern companies, describes this challenge elegantly: “Positioning is the act of deliberately defining how you are the best at something that a defined market cares a lot about.”
The key insight here is that good positioning creates a context in which your unique attributes become obvious strengths rather than irrelevant differences. Your company’s essence may be clear to you, but unless it’s positioned in a context where it creates distinctive value, the market won’t recognise its importance.
It’s important to note that positioning happens at multiple levels within a business. While we often discuss positioning in terms of the entire company, the same principles apply to specific products, services, or even individual value propositions. A large organisation might have an overarching company position while maintaining distinct positioning for different offerings in its portfolio. Smaller businesses might have tightly aligned positioning across the company and its offerings.
For example, Apple as a company is positioned around the intersection of technology and liberal arts, with an emphasis on beautiful design and intuitive user experience. But its individual products each have their own positioning: the iPhone as the premium smartphone that “just works,” Apple Watch as the health and connectivity device that seamlessly integrates with your life, and Apple TV+ as the streaming service focused on quality over quantity. Each product positioning supports and extends the company positioning while addressing specific market contexts.
This multi-level positioning approach allows businesses to maintain coherence while adapting to different market segments and competitive landscapes. The key is ensuring that each level of positioning—from company to product to feature—remains aligned with your core essence while addressing the specific needs of its target audience.
Consider Aesop, the Australian skincare brand founded by Dennis Paphitis. Its essence centres on botanical ingredients, intellectual curiosity, and meticulous attention to detail. But in the crowded personal care market of the 1980s, those attributes could easily have been overlooked. Paphitis made a crucial positioning decision: rather than competing directly with mainstream beauty brands, he positioned Aesop at the intersection of skincare, design, and literature. Stores resembled apothecaries or design boutiques rather than cosmetics counters. Products featured quotes from Shakespeare and Gertrude Stein. This unique position created a context where Aesop’s essence could shine brilliantly.
The result? Aesop became the obvious choice for design-conscious consumers seeking a cerebral approach to skincare. The positioning amplified and contextualised the essence rather than diluting it, establishing a “radical differentiation” that made the brand instantly distinctive.
In astronomy, the “Goldilocks zone” describes the perfect distance from a star where conditions are “just right” for life to potentially develop—not too hot, not too cold. Similarly, optimal positioning in the market requires finding your own Goldilocks zone: not too close to dominant competitors who might overshadow you, yet not so distant that customers fail to understand your relevance.
A.G. Lafley and Roger Martin’s “Playing to Win” framework offers valuable insight here through their twin questions: “Where to play?” and “How to win?” The “where to play” decision is fundamentally about positioning—choosing the specific arena (market segment, geography, product category, etc.) where your essence can become a competitive advantage.
For Brewdog, the Scottish craft brewery founded in 2007, the positioning challenge was formidable. Founders James Watt and Martin Dickie entered a UK beer market dominated by centuries-old breweries and multinational conglomerates. Their essence—rebellious, uncompromising passion for craft beer with bold flavours—could have been swallowed in such a landscape.
Watt and Dickie found their Goldilocks zone by positioning Brewdog not as yet another beer brand, but as insurgents against the entire brewing establishment. They created a new category they called “punk beer,” directly challenging the traditional bitter and lager segments that dominated British pubs. Their provocative marketing, crowd-ownership model, and extreme flavour profiles were deliberately positioned to attract younger consumers disenchanted with legacy beer brands.
“The craft beer market didn’t exist in the UK when we started,” Watt has explained in interviews. “We weren’t competing with other craft brewers; we were fighting against apathy and industrial beer dominance.” By finding this positioning sweet spot—not trying to out-traditional the traditionalists, but not so experimental as to alienate the average consumer—Brewdog grew from a garage operation to a £2 billion company in fifteen years.
Drawing from classic positioning theory pioneered by Al Ries and Jack Trout and refined by subsequent thinkers, we can identify four distinct positioning approaches, each with different advantages and challenges:
This approach positions your offering as an improved version of an existing solution. The advantage is immediate relevance—customers already understand the category and can quickly grasp your superiority.
Fever-Tree, the premium mixer company founded by Charles Rolls and Tim Warrillow in 2005, executed this strategy masterfully. Rather than creating an entirely new beverage category, they positioned their tonic water as a superior alternative to existing mixers. Their insight was simple but powerful: while consumers had become increasingly discerning about premium spirits, they were still using low-quality mixers.
Fever-Tree’s positioning as “the better mixer” meant bartenders and consumers could immediately understand its purpose while appreciating its differentiation. By emphasising natural ingredients and authentic flavours—a direct contrast to artificial sweeteners in mainstream tonics—Fever-Tree grew from a UK startup to a global brand with a market valuation exceeding £2 billion.
This approach carves out a specific subset of an existing market and dominates it completely. Rather than competing broadly, you narrow your focus to serve a particular customer segment with unmatched precision.
Rapha, the cycling apparel company founded by Simon Mottram in 2004, exemplifies this approach. While major sportswear brands offered cycling clothing as part of broad catalogues, Mottram positioned Rapha exclusively for serious road cyclists seeking premium quality. Every product detail, from merino wool blends to minimalist aesthetics, was tailored to this selective audience.
“We weren’t trying to be everything to everyone,” Mottram has explained. “We knew exactly who we were for—the dedicated cyclist who appreciates quality and authenticity.” By narrowing focus rather than broadening appeal, Rapha became the obvious choice for discerning cyclists worldwide, culminating in a £200 million acquisition by Walmart heirs in 2017.
The most ambitious approach is creating an entirely new market category where you can be the definitive leader. Rather than competing within existing classifications, you establish a novel framework that advantages your unique capabilities.
When Airbnb launched in 2008, it didn’t position itself as a better hotel booking platform or a niche accommodation service. Instead, founders Brian Chesky, Joe Gebbia, and Nathan Blecharczyk created an entirely new category: a global marketplace for short-term living spaces in private homes. This positioning allowed them to sidestep direct comparison with hotels while creating a context where their unique attributes—local authenticity, diverse spaces, host relationships—became obvious strengths rather than strange anomalies.
“We’re not in the business of providing beds, or even homes,” Chesky has noted. “We’re in the business of providing belonging.” This category-defining position enabled Airbnb to grow from air mattresses in a San Francisco apartment to a $100+ billion public company, creating a market that previously didn’t exist.
This strategy involves shifting the perception of competitors rather than directly promoting your own attributes. By changing how customers view alternatives, you indirectly enhance your own position.
Oatly, the oat milk company founded in Sweden, masterfully employed this approach when expanding globally. Rather than merely promoting itself as a new plant milk, Oatly subtly repositioned dairy milk as an environmentally questionable choice for environmentally conscious consumers with campaign lines like “It’s like milk, but made for humans” and transparent carbon footprint labelling.
Creative Director John Schoolcraft explained their approach: “We didn’t want to just sell a product; we wanted to start a conversation about food choices.” By repositioning cow’s milk rather than merely promoting oat milk, Oatly created a context where its sustainability credentials became compelling differentiators, driving its growth from niche health product to mainstream alternative with a multi-billion dollar valuation.
Effective positioning isn’t purely theoretical—it requires a systematic approach to translate your strategic choice into market reality. April Dunford’s comprehensive positioning methodology provides an excellent roadmap, which we can explore through several interconnected components:
Before positioning a product or company, you must deeply understand who already loves what you offer and why. This goes beyond basic demographics to uncover the specific problems, priorities, and perspectives of your most enthusiastic customers.
When Slack was developing its positioning, the team didn’t just assume they were building “a better email replacement” or “another enterprise chat tool.” Instead, they studied their early adopters intensely, discovering that their most passionate users valued Slack not just for messaging but for its ability to create transparency across teams and integrate their workflow tools in one place. This insight fundamentally shaped their positioning as a collaboration hub rather than just a communication tool.
Understanding your best customers provides the foundation for all subsequent positioning decisions. For multi-product companies, this analysis might reveal different “best customer” profiles for different offerings, informing product-specific positioning within your broader company positioning.
Once you understand your best customers, you need to consider which market categories might be appropriate homes for your offering. This involves creating a shortlist of potential categories where you might compete or, in some cases, identifying the need for a new category altogether.
When HubSpot launched, they could have positioned themselves within existing categories like “email marketing software,” “lead generation tools,” or “marketing automation.” Instead, after analyzing their best customers and unique approach, they created a new category called “inbound marketing platform.” This category creation reflected how their customers actually used their product and distinguished them from outbound marketing tools.
For your business, exploring categories might involve asking: Do we fit within an established category? Should we position ourselves at the intersection of multiple categories? Or do we need to define something new entirely?
A crucial step in Dunford’s positioning framework is identifying what customers would do if your solution didn’t exist. This reveals your true competitors, which might differ from who you initially thought you were competing against.
For Monzo, the UK digital bank founded in 2015, this analysis revealed something surprising. While they initially saw traditional banks as their primary competition, customer research showed most early adopters were using Monzo alongside their existing bank accounts, primarily as a spending management tool. Their real competitive alternatives weren’t other banks but budgeting apps and spending trackers.
This insight led Monzo to emphasise features like instant spending notifications, categorisation, and budget controls—positioning themselves as a financial visibility tool first, and a full banking replacement second. This approach helped them acquire their first million customers in record time while differentiating from both traditional banks and other challenger banks.
Understanding your true competitive alternatives prevents the common positioning error of fighting the wrong battle. This analysis should happen not only at the company level but for each significant product, service, or value proposition you offer. The competitive set for your flagship product might differ substantially from the alternatives for a new service line.
The second component involves identifying the characteristics that set you apart—your genuine points of differentiation.
When Glossier founder Emily Weiss launched her beauty company in 2014, she conducted a thorough attribute analysis. While the beauty industry focused on transformative claims and aspirational imagery, Weiss identified Glossier’s unique attributes as community-driven product development, transparency about ingredients, and a philosophy of enhancing rather than concealing natural beauty.
“Beauty isn’t about experts telling you what to do or corporations telling you what you need,” Weiss has explained. “It’s about what works for you.” By accurately identifying these distinctive attributes, Glossier could position itself not as just another cosmetics brand but as a beauty company built around customer participation and authenticity.
For multi-product companies, each offering may leverage different unique attributes while still connecting to the company’s core essence. A skincare line might emphasize natural ingredients and sustainability, while a makeup line from the same company might focus on buildable coverage and inclusive shade ranges—both supporting an overall brand essence of authentic, inclusive beauty.
The third component translates attributes into customer value, backed by evidence. It’s not enough to be different—your differences must matter to customers.
Stripe, the payment processing company founded by Patrick and John Collison, differentiated itself through developer-friendly implementation. But the brothers didn’t position this as a technical nicety; they translated it into clear business value: faster integration (in minutes rather than weeks), higher conversion rates, and access to emerging payment methods without additional work.
They then backed these claims with specific proof: documentation showing how integration required just seven lines of code, case studies demonstrating 30% higher checkout completion rates, and testimonials from developers who had implemented the system in a single afternoon.
This value translation needs to happen for each product or service you offer. A company selling both B2B and B2C solutions would translate similar attributes into different value propositions for each audience. The value of “intuitive interface” might translate to “reduced training costs” for a business customer but “saves you time and frustration” for a consumer.
A crucial step that bridges your unique value and your target audience is mapping exactly how your distinctive attributes deliver specific benefits to particular customer segments.
When Peloton was developing its position in the fitness market, they didn’t just identify that they offered convenience (working out at home) and quality instruction. They mapped these benefits to specific customer segments: time-constrained professionals who valued efficiency but wouldn’t compromise on quality; fitness enthusiasts who wanted data-driven workouts; and people who enjoyed the motivation of group classes but preferred privacy. This detailed value-to-segment mapping helped them craft messaging that resonated precisely with each audience while maintaining a coherent overall brand position.
Effective value mapping answers questions like: Which segments care most about each aspect of our value? How does the same attribute create different value for different customers? Where is the overlap between what we do uniquely well and what specific customers uniquely value?
For businesses with varied offerings, this mapping needs to happen at both the company and product levels. The company’s overarching value proposition might appeal broadly, while individual products deliver specific value to distinct segments. The key is ensuring alignment between these levels of value mapping to maintain positioning coherence.
The final component involves determining who values your differentiation most—your ideal customer profile.
When Gymshark founder Ben Francis was scaling his fitness apparel company, he made a crucial positioning decision to focus specifically on the 18-25 year old fitness enthusiast segment rather than trying to compete with Nike or Adidas across all demographics. This precise segmentation allowed Gymshark to tailor everything from product design to marketing channels toward this specific audience.
“We’re not trying to be the biggest,” Francis has noted, “we’re trying to be the most connected to our specific community.” By focusing on young fitness enthusiasts who valued both performance and aesthetics, Gymshark grew from a screen-printing operation in a garage to a £1 billion+ company in just eight years.
For businesses with multiple offerings, different products or services might target distinct customer segments while still aligning with the company’s overall positioning. A software company might have an enterprise solution for large corporations, a mid-market offering with different features and pricing, and a streamlined version for small businesses—each positioned appropriately for its target segment while maintaining coherence with the company’s essence.
Once you’ve worked through the previous elements, you need to synthesize your positioning into a clear, compelling statement that can guide all your marketing and communication efforts.
A well-crafted positioning statement typically follows this structure: “For [target customer] who [need or opportunity], [Company/Product] is a [category] that [key benefit]. Unlike [competitors], [Company/Product] [primary differentiation].”
When Zoom entered the crowded video conferencing market, they distilled their positioning into a clear statement: “For business professionals who need to connect with others remotely, Zoom is a video communications platform that delivers happiness through frictionless meetings. Unlike traditional video conferencing services, Zoom offers a consistent, high-quality experience across devices with one-click simplicity.”
This statement wasn’t just an internal marketing document—it informed product decisions, sales training, marketing campaigns, and even customer support protocols. It explicitly named their target (business professionals), the category (video communications platform), the value (happiness through frictionless meetings), and the key differentiation (consistent quality and one-click simplicity).
For companies with multiple offerings, each product might have its own positioning statement that nests within the parent company’s broader positioning, creating a coherent hierarchy of positioning that maintains alignment while addressing specific market needs.
The final vital step in positioning is testing your approach with real customers and refining based on feedback. Even the most thoughtfully crafted positioning needs validation in the marketplace.
When Drift launched its conversational marketing platform, CEO David Cancel insisted on testing multiple positioning approaches with customers before settling on their final direction. The team conducted interviews where they presented different positioning concepts and measured which resonated most strongly with their target audience. This testing revealed that while their internal team was excited about the technical capabilities of their chatbots, customers were most compelled by the idea of “conversational marketing” that could remove forms and friction from the buying process. This insight led to their category-creating positioning that fueled their rapid growth.
Effective positioning testing might include:
This testing and refinement shouldn’t be a one-time event but an ongoing process as the market evolves. The most effective positioning is dynamic, continuously informed by customer feedback while remaining true to your essence.
For products at different lifecycle stages, your testing approach may vary. New products might require more extensive testing of fundamental positioning elements, while established products might focus testing on refinements and messaging variations.
To apply these positioning principles systematically, consider using the following canvas—adapted from frameworks by Dunford, Neumeier, and Lafley/Martin—to clarify your strategic position:
Essence Review: Summarise your company’s core “why + how” in one sentence Example: “We exist to make professional-quality tools accessible to everyday creators.”
Competitive Alternatives: What would customers use if you didn’t exist? Example: “Amateur-focused brands or prohibitively expensive professional equipment”
Unique Attributes: What makes you meaningfully different? Example: “Pro-grade components, modular design, transparent pricing, creator community”
Value Translation: How do those attributes create customer value? Example: “Allows hobbyists to produce professional-quality work without overspending on features they don’t need”
Ideal Customer: Who values this differentiation most? Example: “Serious amateur creators who have outgrown entry-level equipment but can’t justify professional prices”
Positioning Approach: Which of the four approaches best leverages your essence in this market? Example: “New Category: ‘Prosumer Creator Tools’ — bridging the gap between amateur and professional equipment”
Positioning Statement: Synthesis of the above elements Example: “For serious amateur creators who have outgrown basic tools, [Company] provides professional-quality, modular equipment at accessible prices, unlike either entry-level brands that limit your capabilities or professional gear with prohibitive costs and unnecessary features.”
Execution Plan: How this position will be expressed through product, marketing, sales, and culture Example: “Product: Emphasise modularity and component quality; Marketing: Showcase amateur work that looks professional; Sales: Focus on upgrade paths rather than one-time purchases; Culture: Build community among serious amateurs”
Perhaps the most challenging aspect of positioning is what it requires you to forsake. Effective positioning demands sacrifice—the willingness to focus on some customers at the expense of others, to highlight certain attributes while downplaying others, to compete in specific arenas while avoiding others.
When Basecamp founders Jason Fried and David Heinemeier Hansson positioned their project management software around simplicity, they deliberately abandoned features their competitors offered. “We leave things out on purpose,” Fried has explained. “Making decisions about what you won’t do is as important as deciding what you will do.”
This willingness to disappoint some potential customers in service of delighting your core audience represents the true courage of positioning. It requires the conviction that by meaning something specific to the right people, you’ll create more value than by meaning little to everyone.
The most compelling companies don’t fight for attention; they position themselves where their brilliance becomes self-evident. They find their proper place in the competitive cosmos—not too close to massive competitors, not too distant from customer understanding—and from that carefully selected position, they begin to exert their own distinctive gravitational pull.
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