7 Signs You Have A Positioning Problem

7 Signs You Have A Positioning Problem [And Why Familiarity Kills Businesses]

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familiarity

There is a new status quo emerging in the business world and it can all be summed up with one word: “Familiar”.

Competitive rivalry tends to force business owners to slavishly copy what has worked in the past, casting their services ever wider with the hope of catching new clients in the process.

From a market perspective, the familiar is invisible – a category which is typically is dominated by incumbents who compete on price, essentially then re-enforcing the feeling of familiarity in the eyes of consumer and this is especially true in markets where there is intense competition.

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Related: Why Flame-Grilled Chicken Franchise Galito’s Opened Up Shop Right Next To The Competition

How Customers Choose

Customers are always hiring a business, product or service to solve a problem for them, but the challenge for them is to articulate their problem and understand the costs of switching from one business, product or service to another.

It’s about risk. Often, it can be less risky for a customer to maintain the status-quo than to change it and that can be said for choosing a new type of yoghurt, switching banks and especially choosing between your own business and one of your competitors.

From a customer’s perspective, there are always quantifiable and unquantifiable switching costs. Quantifiable switching costs are things like price and taste but then there are the unquantifiable switching costs like your child crying because he/she doesn’t have his usual yoghurt in his lunch box.

This same dichotomy can be applied to literally every single type of product and service that business offers. 

Why Positioning Matters

For business owners who do not have a compelling positioning and message in the market, your business will not grow. In today’s cluttered brand and communications landscape, there are three things that determine whether your brand will have any notoriety in the market: Distinctiveness, credibility and salience.

If your brand is not doing anything unique it will lack distinctiveness. If it lacks credibility your prospects will not believe you and if it lacks future salience it will lose relevance and without relevance you do not have a business.

Positioning your business is about helping your market make sense of what you do but most importantly, it’s about positioning your business in the mind of your target customer in such a way that your business becomes distinctive and ridiculously attractive.

7 Signs You Have a Positioning Problem

1Your prospects cannot tell you what you do

There is a simple litmus test for this. Phone three prospects and ask them what they think you do as a business? If you fail to get three of the same answers you have a positioning problem.

2You are losing business to your competitors

Let’s say you have two competitors trying to sell similar things to the same market. If there is any parity whatsoever in terms of the competitor’s value propositions and their price, then the prospect will invariably revert to the competitor with a more unique positioning in the market.

In my experience, many business owners lose out to a competitor who simply tells a better story in the marketplace and the competitor with a more compelling story that talks to a differentiated positioning will always win out. So, if you are losing business to your competitors and are feeling the pinch, then you probably have a positioning problem.

3Your brand is underperforming against objectives

When your positioning is not suited to the market you are serving it will typically have a negative impact on the brand and sales power of your business.

Brand power refers to the notoriety or salience of your brand in the market that you operate in. There is a difference between awareness and notoriety – your market may know who you are but is your brand noteworthy? Sales power refers to the ability of your business to make a sale. If your business is underperforming against its brand and sales objectives, then you probably have a positioning problem.

If your business does not occupy a unique position in the mindset of your prospects it will significantly hinder your ability to make a sale, and ultimately grow your business.

Related: How to Create a Winning Mindset, to Crush the Competition

4Your positioning doesn’t reflect what you do

In today’s rapidly changing business world, the needs of your customers are constantly changing. To address these changing needs, business owners must change what they do to continue to serve the changing needs of their customers. Enter the pivot.

In most cases, this means a shift in strategy, but what you have then is a situation where your positioning no longer reflects what you do as a business, so if you haven’t addressed your positioning in the market in the last two years, then you probably have a positioning problem.

5You are competing on price

The importance of positioning is directly proportionate to the degree of competition in the market. As a market matures, more competitors enter the market which puts pressure on incumbents to maintain their market share. This manifest into things like declining volume sales and an ever-increasing margin squeeze.

To counteract this effect, the knee-jerk response is to react by competing on price and when that happens, it almost always ends in failure. But why compete on price when you can compete on value? A reworked positioning of your business in the marketplace is the conduit to the re-enforcement of value that you represent in the market and can change the perception of the market about your business.

Perception goes a long way to ensuring that you can continue to charge a premium for your products and services and remain ahead of a price hungry competitor. So, if you are competing on price and not value, then you probably have a positioning problem.

6Your communications do not support your positioning

There is nothing worse than a confused customer. If your messages from a sales and marketing perspective are not congruent across all channels it confuses the hell out of them because they are not on message; all your communications need to support the story that supports your positioning.

If your communications are fragmented, then you probably have a positioning problem.

7Your employees are not inspired by what you do

A business is simply a group a people working towards a common goal. Your positioning must act as a north star towards achieving that goal and should be easily understood, relatable and transferrable. If your employees are not inspired by what you do, then you probably have a positioning problem.

How Digital Kungfu Can Help

As a business owner, when you are working in your business you often cannot read the label from inside the bottle.

An objective view of your businesses needs to be painted using a combination of research, specialisation and differentiation methods to develop a highly effective positioning for your business that will make it distinctive and ridiculously attractive in the eyes of your prospects.


Digital Kungfu specialises in the helping business owners achieve just that. Our strategies combine research, strategy and implementation to deliver a market positioning that you can hang your hat with certainty.

Matt Brown
Matt Brown is the CEO of Digital Kungfu a strategic business consultancy. He is also the host of the Matt Brown Show - a podcast empowering and entrepreneurs around the globe.