1. Choose your focus go-to-market segments
Imagine you’re scaling a SaaS company and searching for a CRM. You’re looking at two options:
- A CRM that gets your sales organized
- A specialized CRM that help to organize your sales, track recurring revenue, and the churn rate
Which one will you choose? The second one seems like a natural choice for a SaaS company.
That is the power of market segmentation.
Most B2B companies skip this step and create a customer avatar that’s essentially the lowest common denominator of their potential customers. This leads to two most common mistakes that rob B2B companies of revenue: one-size-fits-all positioning and broad targeting.
Market segmentation benefits:
- ROI: focus your scarce resources on prospects who are a better fit for your product, more accessible and easier to sell to, stay longer, are more profitable, generate more revenue and give you more referrals
- Better client-message fit: personalize campaigns using segment-specific USPs (e.g. the CRM that helps SaaS companies track recurring revenue and churn rate), segment-specific terminology, case studies, and testimonials
- Virality: word-of-mouth spreads more easily in a well-connected segment and it gives you a chance to partner with industry influencers and network organizations
B2B tech example with insider tips: Choicely succeeded where much larger companies with huge existing customer bases failed. They successfully market a native no-code app builder and even build virality into a complex B2B product.
What did they do differently?
Instead of trying to market a generic app builder, they focused on media, sports & entertainment segments and built features that supported visuality, interactivity, fan engagement, and being social, and community-driven.
An inherent virality in their product. An easy answer to one of the biggest sales objections. And as a side-effect, they have been called by some investors “the most entertaining tech company”.
For insider tips, check out the interview with Choicely’s CEO Kaius Meskanen.
Note that choosing focus go-to-market segments is about focusing your efforts and stacking the odds in your favor — not about positioning yourself exclusively as the “ for ” (which is one of the 12 marketing positioning strategies presented below).
- Export a list of your customers from your CRM / accounting software, including the total amount you invoiced
- Segment them by industry, revenue, team size, products or services they bought from you
- Define what segments have the highest LTV and generated more revenue than other segments
- Pick the most promising segments and potentially brainstorm additional market segments, ending up with 5-10 segments to evaluate
- Make a copy of the market segmentation template below
- Below the standard criteria outlined in the template, outline other criteria: person’s and company’s characteristics that make them really care about your unique approach and features. E.g. amount of purchase orders and invoices in different formats, technology stack, size or growth of a specific department, the background of the decision-maker, ad spend, etc.
- For each segment:
- Describe the real reason companies in this segment (would) buy your product and what challenges you solve for them
- Rate every segment on all criteria
- Pick a segment or two (depending on your resources) to focus on. Note that you’ll need a separate ICP (next step) for each segment you choose
Step 2. Develop an Ideal Customer Profile
Ideal Customer Profile helps you capture the information you need to target and qualify prospects who are more likely to convert, stay longer, generate more revenue, and give you the best referrals, testimonials, and case studies.
An ideal Customer Profile is a list of characteristics that your best customers from a specific market segment have in common.
It describes who they are, their challenges and goals, the value they get from your product, their buying process, objections, and purchase criteria, and why they choose your product instead of competitors.
Common mistake companies make is to produce a generic version for all segments — or base it on their biased interpretation. You need up-to-date (post-COVID) data from in-depth interviews with your best customers from the target segment.
Check out our detailed guide on how to develop an ideal customer profile.
Step 3. Analyze your competitors
The essence of positioning is about how your customers perceive your brand or product in relation to competitors they’re comparing you to.
You’re usually compared to two types of alternatives:
- Your direct competitors — global or local market leaders, or products in a similar price and feature range
- Other alternatives, like Excel or ‘hire an intern’
The latter is especially important if you’re operating in an emerging category, of which most of your prospects are not aware of. For example, when Drift was starting, most marketers were not using chatbots on their website, so they had to position against lead generation forms.
- List competitors that you’re coming up against in your sales
- In your ICP interviews, include questions like: What have you tried in the past to deal with the challenge you’ve just described? What did you find lacking – and what do you think the right solution should have been? What other solutions did you consider in the past (and why did you choose us)?
- Analyze the competitors’ marketing positioning strategy. Do they have a niche focus? How do they differentiate themselves? What arguments do they highlight on their main web pages? How do they call themselves? Analyze their reviews: what do their customers really like about them and what are their main complaints?
- Make SWOT analysis. Considering what matters to your ICP the most, what are your strengths and weaknesses, where do the competitors fall short (opportunities) and how do they beat you (threats)?
Step 4. Pick your market category (w/12 positioning strategies and examples for B2B tech and service companies)
From the perspective of your client, a market category is what they’ll label your business or your product with.
“Oh, it’s a CRM system”, or “ah ok, they’re a marketing agency”, they may say when they learn about you the first time.
Each category comes with a set of expectations (about features, prices, business models…) and determines which competitors you’ll be compared to.
You cannot avoid being “put in a box”, or labeled with a market category. It’s how your prospects deal with thousands of solutions and products fighting for their peace of mind.
But you can influence how your customers and prospects perceive your brand or product in relation to others in the category. That is what a positioning strategy is all about.
Here are the 12 most common positioning strategies and examples for B2B tech and service companies — with insider tips from their founders and marketers.
Strategy #1: Head to head: winning with superior experiences
This strategy makes sense in large, mature markets where market leaders stay on top despite poor customer experiences. Think banking or telecommunications, where, as Bain puts it “Experience is the new product”.
We all know of examples like Uber or Revolut where the superior experiences were enabled by tech innovations that ended up being new categories in their own right.
But there are also B2B tech and service categories where this strategy makes sense.
B2B Tech Example with Insider Tips
Nextiva is an all-in-one cloud communications platform that supports any channel (virtual phone system, text, video, email, and instant messaging) and any related workflow through a set of customer service, sales, and team collaboration tools.
Since virtually any business needs a communication tool like Nextiva, the market is huge and ripe with competition. The “all in one” positioning is not unique either.
And yet, Nextiva managed to grow from $70M to $200M in revenue over the last 2.5 years without external investments.
The way Nextiva differentiates is by providing a superior customer experience. The company was founded based on the idea of having the best customer service ever.
But Nextiva takes superior experience beyond the Amazon-style customer service, to provide unmatched reliability (they are the only provider in the industry that hasn’t had outages in more than three years) and a frictionless implementation process.
Tune in to listen to insider tips from Nextiva’s director of growth marketing Gaetano Di Nardi.
Strategy #2: Change the battlefield: pivot to an adjacent category
What we often don’t realize is that the choices we made early about our product category can box us in unfavorable ways.
The good news is, categories today are much more “fluid”, the borders between different categories are not always clear, and categories and are evolving faster than ever before.
So you might still choose an adjacent category.
B2B Tech Example
In “Obviously awesome”, Dunford gives an example of her own startup that started as a “database”. But by being positioned in the database category, their prospects expected their product to have everything that Oracle’s database had, but better. They could never win head to head against Oracle.
By focusing on their main differentiator (fast analytics of large amounts of data), they discovered a market category without a clear leader at the time: the data warehouse market.
This shift in positioning got them out of competing with Oracle and is aligned with their strengths. It also allowed them to raise prices because they shifted away from the database (a commodity) to a data warehouse, which commanded premium pricing due to a smaller amount of offerings on the market.
Strategy #3: Vertical positioning: “Big fish, small pond”.
Your goal is to win in a well-defined segment of the market.
You do this by targeting buyers in a subsegment of the broader market who have different requirements that are not being met by the current overall market leader.
2 B2B tech examples
Cumul.io’s founders decided to build a solution in a bloody red ocean of analytics tools, dominated by incumbents like Tableau and Microsoft (Power BI).
Focus on SaaS companies looking to add analytics and dashboards to their own applications or platforms.
While Tableau and Power BI deliver powerful business analytics tools and dashboards, they miss key puzzle pieces necessary to integrate stunning, interactive dashboards right in their application with just a few lines of code.
The results? With pricing starting at four figures, they managed to acquire 200+ customers in 30 countries — without any outbound sales or marketing. For insider tips, check out the interview with Cumul.io’s CEO Karel Callens.
In another example, our client leveraged this strategy to grow their average deal size by a factor of 10, while their competition was a fraction of what they faced before.
Their survey technology was innovative, provide better response rates, and had a few corporate clients. But it remained a struggle to build traction in the ‘usual suspect’ markets like employee engagement.
After a veteran CEO joined their team, they decided to take a step back and review their existing customers. The most promising use-cases seemed to be in the healthcare market.
The team embarked on a difficult journey that resulted in a unique competitive advantage:
The first step was to find an early adopter. After speaking to many healthcare providers, they managed to sign a pilot project with an innovative hospital.
The startup then parlayed that first success into a few more projects with other hospitals.
Finally, they were ready to go after their real target: pharmaceutical companies. Again, through a pilot with an ‘innovator’, they slowly started signing bigger deals.
They still had to overcome all other barriers to entry, like getting required certifications and corporate approvals.
In addition, they had to invest even more in building specific features to increase the value of their offering and transform “an app” into a solution.
But once they were in, the rewards were great too. Like I mentioned above, their average deal size grew by a factor of 10, while their competition was a fraction of what they faced before.
Strategy #4: Niche down
This strategy is for B2B business in a highly competitive category with hundreds or thousands of competitors and developed subcategories.
You are choosing both a target segment (e.g. one or two verticals you want to focus on) and your specialty or unique features (or expertise area for professional services).
For most service-based businesses — this strategy is a must. We’ll dive into more details about marketing positioning for service-based companies below.
But this strategy can help B2B tech companies too, especially if they’re active in categories with hundreds of competitors.
B2B Tech Example
That’s why Salesflare, competing against 600+ companies in the CRM space, is so clear about both their best fit market segments (marketing agencies and tech startups), and their product differentiation (quick to deploy & easy to use, thanks to their unique automation features).
Learn more about their strategy in an interview with SalesFlare’s CEO Jeroen Corthout:
Strategy #5: Positioning for B2B services.
Most service providers — especially professional service providers — tend to jump on most requests from potential clients, and sometimes take on projects they have no deep expertise in.
This is often driven by the fear of missing out. If I say no, I’ll miss out on this project, the thinking goes.
Unfortunately, this is a road to mediocrity.
Because such a mindset leads them to become a “jack of all trades, but master of none.” Which is the exact opposite of carefully selecting an expertise area and becoming a go-to expert in your niche.
B2B service example #1 with insider tips.
Sweet Fish Media is a great example of a very tight positioning, both vertical (focused on B2B SaaS companies with 50-5000 employees) and horizontal (they’re a podcast agency for B2B brands).
Tune in to the interview with the founder, James Carbary to learn how they pivoted into this narrow positioning, and how it helped them achieve 50-100% growth, year over year.
James is a big inspiration for us in running our own podcast, and the author of a best-selling book Content-Based Networking: How to Instantly Connect With Anyone You Want to Know
|Jack of all trades
||Niche Trusted Advisor
|Expertise Broad: knows quite a bit about different topics (and can “talk your ear off” about them).
Develops deep expertise around a narrow topic.
Quickly recognizes patterns and can diagnose root causes of problems.
Does what the client asks, much like a waiter in a restaurant, “takes orders”.
Clients perceive them as “one of many” “Ah, so you are a software development company? If I need one I know how to find them.
verage pricing in the industry; gives discounts or accepts unusual payment practices; often based on “time for money”.
Creates custom project proposals and plans, figures things out on the go, has little control of their own agenda Has standardized proposals and an efficient process refined through repetition.
Ends up in situations where they’re in over their head. Sometimes relies on “fake it till you make it” while feeling insecure, inappropriate, and having to learn on the customer’s dime.
|Mainly tactical knowledge, some of it without hands-on experience in a context like yours.
Often, a topic that is of strategic importance to their ideal clients.
Recommends specific solutions proven to generate the desired results with other similar clients.
Much like a medical doctor, diagnoses the problem, prescribes the steps, and guides the clients through a proven process.
Clients perceive them as a top expert with a unique approach; uniquely positioned to solve their specific problems.
Commands premium, value-based pricing, above the market average. Builds IP and overtime monetizes it through other means than “time for money”.
Controls own agenda and leaves a minimum of 30% of their time for deepening of their expertise and developing the business.
Feels confident in their knowledge and ability to create an impact for their clients. Feels congruent with own values, fulfilled with a sense of purpose, and driven by the desire to build something bigger than themselves
B2B service example #2 with insider tips.
FullFunnel.io’s marketing positioning is full-funnel marketing (horizontal) for B2B tech and service businesses with complex and long sales cycles (vertical). While we could also help other types of B2B businesses, we focus solely on this niche.
In one of the most competitive markets out there — marketing consulting — FullFunnel.io doubled their revenue during the “lockdown quarter” compared with the same quarter the year before.
We also rarely have to compete when submitting proposals, and this unique positioning allowed us to build considerable IP, and launch a unique Full-Funnel B2B Marketing Academy.
For insider tips, tune in to this short interview with the founder, Andrei Zinkevich.
B2B service example #3 with insider tips.
iNostix won bids for enterprise projects against the big 4 consulting companies on a regular basis — and got acquisition inquiries from 3 out of 4 of these companies (iNostix was acquired by Deloitte in 2016).
Their positioning was sharp, and they invested heavily in communicating their positioning with their market. Their founder and CEO Luk Smeyers published 200+ articles, and spoke on 100+ conferences — and all of it around their narrow specialization.
Tune in below to listen to Luk’s insider tips, who went on to start The Visible Authority — where he now teaches other consultants strategies to grow their revenue by transforming them into visible authorities:
Strategy #6: Challenge the status quo by going all-in on unique features.
It’s important to realize that this strategy is NOT about adding more features than your competitors.
It is about:
Understanding what matters to your best customers that is not well-supported in the market
Going further than anyone in the market to develop specific, often unique features or combination of features
Communicating about it
B2B tech examples with insider tips
These are the two examples I used in the intro — but now I want you to draw your attention to specific steps they took to make this strategy work (and share insider tips from one of them).
The first example was Instapage, positioned as a landing page tool with unique post-click optimization and experimentation features for Google and Facebook advertisers.
Note the latter part of the sentence.
Instapage focused on their best customers — first Google advertisers — to provide them something no other landing page tool provides. When running Google Ads, it’s extremely important to align the landing page with the search term and the ad copy used to send the traffic to this landing page. Previously, no other tool had support for this.
The second example was lemlist, which went beyond any other cold emailing tool in helping their customers better response rates. Note all the actions they took to implement their positioning strategy:
Implemented a unique set of personalization features such as personalized images, video thumbnails, and landing pages
Implemented unique deliverability features such as lemwarm (automatic warm-up of email accounts)
Went way beyond other providers in educating their market on how to get higher response rates (e.g. lemlister of the week, their community, etc)
Check out the interview with Vuk Vukasinovic, lemlist’s head of growth where he shares other insider tips:
Strategy #7: Challenge the status quo by addressing a common objection.
This strategy also relies on a deep understanding of your best customers. What are their most common objections and how can you address them?
The best-known examples of a company that made it big by addressing common objections are in B2C (but I will provide a B2B example below):
CarMax became America’s largest used-car retailer by understanding that customers don’t want to haggle over price or risk buying a lemon.
The price on the car is the price you’ll pay, their salespeople aren’t compensated on commission and have a strict quality certification and inspection process that ensures every car they sell is reliable
Domino’s pizza understood that people don’t like waiting too long for their food to be delivered. So they pioneered a guarantee: you’ll get a hot, fresh pizza delivered to your door in 30 minutes — or it’s free.
B2B tech example with insider tips.
If you listen to Expandi’s story below, you’ll notice how much effort their co-founder and CEO Stefan Smulders spent understanding the common problems and objections of their ideal customers in the market of LinkedIn automation tools — and how he used this knowledge to carefully develop a unique positioning for his product.
LinkedIn was cracking down on automation tools, and many customers were concerned about their LinkedIn accounts being suspended. Expandi offers the safest tool for LinkedIn automation.
Lead generation agencies struggle to manage multiple clients in a single tool. Expandi offers a unique set of agency features that make it easy to manage multiple LinkedIn accounts
Acceptance and response rates on LinkedIn are going down – and LinkedIn penalizes people who do many connection requests that people refuse.
Expandi offers advanced personalization and list building features that allow you to implement personalized, trigger-based outreach campaigns.
Note also how well Expandi executes their positioning strategy in both product and all customer-facing activities: from a unique brand voice, through a content strategy unique in their category, to their approach to serving their customers that none of their competitors have.