I was recently coaching a CEO whose product has tons of innovative and unique features and capabilities to offer. Unfortunately, sales are stalled and the business is not moving forward. They are stuck in a doom loop of selecting an ideal customer profile (ICP) then realizing that the buyer is only interested in a subset of the company’s capabilities, so they pick a different ICP in hope of finding a home for their broader set of capabilities, only to find that they still have a mismatch. They have a clear vision of why and how all of their capabilities fit together to deliver a great solution, the problem is aligning it with a clear ICP so they can focus their go to market efforts. It feels like a chicken or egg dilemma - capabilities first or ICP first. You could describe it as a Product / Market fit problem, but it is more an issue of a unique solution trying to convince an existing market to try something new.
What they are really dealing with is the need to select a specific ICP and then package their offering in a manner that helps their ICP understand the value proposition that makes it a compelling purchase. The challenge is that they have defined a solution that is sufficiently different from the competition that buyers do not have a classification system to grasp the offering and define evaluation criteria. Buyers have pre-conceived concepts of the solutions they are looking to purchase. Often it is in the form of an RFP (request for proposal) that has a checklist of features and needs. It is as if they are entering the store and they know what aisle and shelf to find all of the products that can meet their needs. Making a choice is only a matter of comparing similar features and selecting the best fit. The problem is that this vendor’s solution does not neatly fit on an existing shelf in an existing aisle. It is solving the problem differently and in a manner that encompasses multiple related problems that are typically each solved by point solutions that are found on various aisles and shelves.
The original Apple iPhone faced a similar challenge. It was a mash up of a phone, a camera, a browser, a pager, an address book, a calendar, and several other applications. We knew where to buy each of these separate items, but the iPhone was a new class of device. The solution for Apple was in the name. They called it a phone, so it went in the phone aisle, but on a new shelf. They did not try to sell it as a camera or a pager or any of its other functions, but they incorporated all of the additional capabilities into their competitive pitch for why this was the ideal phone. The irony of the Apple example is that the phone features turned out to be table stakes. Making phone calls is a generic capability that is identical for all vendors, and nobody buys a device because it is better at making phone calls. The genius was that Apple redefined what a phone is, and helped us all realize our definition was too narrow. Traditional phone manufacturers could not compete with Apple’s broader definition.
For the CEO I have been helping, and for most mere mortals, we do not have the market power of Apple to redefine a category overnight. However there are lessons to be learned and applied:
First, select an existing well understood and valuable aisle and shelf. By picking the aisle and shelf, you are also selecting an existing ICP who is already coming to the store to make a purchase. You want to be found when they start looking for a solution.
Next, make sure that the new offering has standard competitive capabilities that meet the basic requirements of the selected aisle and shelf. You have to get past the initial screening, so it is important to do the basics. In the Apple example, buyers had to be able to make phone calls in order for the new device to be considered when a buyer wanted a new phone.
Position the new capabilities to differentiate the offering, and focus on the benefits that are uniquely possible because of the broader solution. This is not a features conversation. The buyer has a list of required features based on how all of the other vendors approach the problem, but their checklist does not have line items to compare your new features to other products. However, the buyer will understand new use cases and the benefits of a better solution - benefits, not features. Apple showed us why having a phone with integrated camera, email, and text made the phone more valuable. They did not try to sell us on every feature of the camera or the email or text.
When you identify an existing aisle and shelf it enables you to know who is shopping and what they are looking for. Whether you surveyed your competitive field and decided to pick the aisle and shelf where known competitors are found, or whether you selected a target ICP and decided to be present where that ICP goes shopping, either answer leads to the same place. Stake out some turf on the aisle and shelf where your ICP expects to find solutions, and declare that you are a part of that competitive category. Then, differentiate your offering by demonstrating the unique benefits that can only be achieved with your unique combination of capabilities. The more you can differentiate your offering in a sea of similar products and services, the easier it is for a buyer to purchase from you. Over time, competitive products drift toward commodities. In the arms race to add features and cover deficiencies, products all start to look alike and act alike. The list of standard features grows, and the only differences are subtle or at the edges. When all of the products look alike, the buyer’s journey becomes protracted because they get lost trying to discover the rationale for selecting one vendor and product over another. When markets get to this point, the strongest competitors become ‘do nothing,’ or ‘whoever has the lowest price.’ That is what the phone market looked like before Apple launched the iPhone.
A vendor with a new and unique offering has to rise above the noise. The hard way is to attempt to define an entirely new category of solution and convince potential buyers to pay attention. I contend, the better path is to breakthrough in a familiar category with a revolutionary approach. Notice, I said revolutionary, not evolutionary. This is not 1+ marketing where you present one new feature or one new custom color. If your approach is truly a radical departure from the pack, then the goal is to stand on the shoulders of existing solutions and grab your shelf space in the most prominent position by clearly demonstrating the benefits of your new approach.