Most B2B products are not poorly built — they are poorly positioned. Positioning determines whether your ideal customer immediately understands why your product is the best option for them, or whether they file it into the mental drawer labeled "interesting but not sure what to do with this." Getting positioning right is the highest-leverage work a product marketer or founder can do, because it shapes messaging, channel strategy, pricing, and sales conversations all at once.
What product positioning actually means
Positioning is the deliberate act of defining how your product should be perceived by a specific target customer, relative to the alternatives they actually consider. The classic framing comes from Al Ries and Jack Trout, who argued in Positioning: The Battle for Your Mind (1981) that positioning is not about the product — it is about the mind of the prospect. You are not changing what your product does; you are changing how it is understood and remembered.
That strategic philosophy is foundational, but it does not tell you how to build a positioning statement in practice. That is where April Dunford's work, particularly her book Obviously Awesome (2019), becomes indispensable. Dunford, who has positioned over two dozen enterprise technology products, argues that most companies default to positioning by analogy ("we're like Salesforce but for X") or by category incumbency — and both approaches lead to undifferentiated messaging that buyers ignore.
April Dunford's five-component positioning method
Dunford's framework identifies five interdependent components that must be defined in sequence. Skipping or reordering them produces positioning that collapses under scrutiny.
| # | Component | The question it answers |
|---|---|---|
| 1 | Competitive alternatives | What would customers do if your product did not exist? |
| 2 | Unique attributes | What features or capabilities do you have that alternatives lack? |
| 3 | Value (not features) | What is the business outcome those unique attributes enable? |
| 4 | Target customer segment | Who cares deeply about that value, and for whom is it a top priority? |
| 5 | Market category | What frame of reference helps the right customers immediately understand your value? |
The sequence matters. You cannot know your unique attributes until you know what the realistic alternatives are. You cannot articulate value until you know which attributes are truly unique. And you cannot choose a market category wisely until you know who your best-fit customer segment is and what they already understand.
Step 1: Competitive alternatives (not competitors)
The first and most disorienting step is to stop thinking about competitors and start thinking about alternatives. The competitive landscape in your prospect's mind is rarely the same as the competitive landscape you track in your CRM.
Ask this question in your next customer interview: "If we didn't exist, what would you do?" The answers will often surprise you. For a B2B workflow tool, the answer might be "we'd build it internally," "we'd use a combination of Slack and spreadsheets," or "we'd hire a consultant." These are your true competitive alternatives — and they determine the baseline of value you need to exceed.
Common categories of competitive alternatives in B2B include: do-nothing (status quo), internal build, adjacent tools repurposed for your use case, direct category competitors, and offline or manual processes. List all of them before moving to step two.
Step 2 & 3: Unique attributes mapped to value
Once you know the alternatives, list every feature or capability your product has that those alternatives lack. Then — and this is the critical translation most teams skip — convert each attribute into the business outcome it enables for the customer.
| Unique attribute (what it is) | Value (what it means for the customer) |
|---|---|
| Real-time data sync across all integrations | Revenue teams always work from a single source of truth — no more deal reviews built on stale data |
| No-code workflow builder | Operations teams can automate processes without engineering tickets, cutting time-to-launch from weeks to hours |
| Granular role-based permissions | Enterprise compliance teams can meet audit requirements without restricting frontline access |
| On-premise deployment option | Companies in regulated industries can adopt the product without violating data residency requirements |
Notice that the value column describes business outcomes, not technical properties. This translation is the bridge between your engineering team's perspective and your buyer's decision criteria. For more on how value connects to purchasing decisions, the jobs-to-be-done framework (Clayton Christensen, Tony Ulwick) is the natural companion — buyers hire your product to accomplish a job, and the value statement should describe what that job completion looks like.
Step 4: Identifying the best-fit customer segment
After mapping attributes to value, you will typically find that not all customers care about all the value equally. The segment that cares most intensely about your highest-value differentiators is your best-fit segment — and your positioning should be built for them, not for a vague average of all possible buyers.
Segmentation in B2B positioning goes beyond firmographics. The most useful segmentation variable is often a specific situation or context: companies that are in a specific growth phase, have a specific compliance requirement, have just experienced a specific trigger event, or are trying to accomplish a specific strategic goal. This situational segmentation produces sharper positioning and better-qualified pipeline.
Your ICP (Ideal Customer Profile) should inform but not replace this step. Where the ICP asks "who are they," positioning segmentation asks "who cares most about what we uniquely offer." For a deeper treatment, see our buyer persona guide, which includes a fillable template for mapping ICP dimensions to messaging hooks.
Step 5: Choosing your market category
The market category is the context you place around your product to help buyers understand it quickly. It is one of the most consequential positioning decisions a company makes — and one of the least discussed.
Every market category carries a set of assumptions: what the product does, what it costs, who buys it, who it competes with, and what success looks like. When you choose a category, you inherit those assumptions. Dunford identifies three broad strategies:
| Category strategy | What it means | When to use it |
|---|---|---|
| Head to head | Enter an established category and claim superiority | The category is well understood; you have clear, demonstrable advantages over the incumbent |
| Big fish, small pond | Create a subcategory where you are the obvious leader | You serve a specific segment better than the general category leader does |
| Create a new game | Define an entirely new category | You solve a problem that buyers do not yet have a name for; requires significant market education investment |
Most early-stage B2B companies should default to the "big fish, small pond" strategy. Creating a new category is expensive and slow — it requires educating the market before you can sell to it. Entering an established category head-to-head is viable only if your differentiators are substantial and provable.
Positioning canvas template
Use this fillable canvas to run a positioning workshop with your team. Complete each row in sequence; do not skip ahead.
| Component | Your answer | Validation source |
|---|---|---|
| Competitive alternatives | List 3–5 alternatives your buyers would actually use | Customer interviews, win/loss calls |
| Unique attributes | Features/capabilities none of those alternatives have | Product team, competitive analysis |
| Value translation | Business outcome each unique attribute enables | Customer success stories, ROI data |
| Best-fit segment | The customer type who values this most intensely | CRM win rate by segment, CS team input |
| Market category | The frame of reference that makes your value obvious | Sales conversation testing, messaging A/B |
| Positioning statement draft | For [segment], [product] is the [category] that [value], unlike [alternatives] which [limitation]. | PMM review + leadership sign-off |
Common positioning mistakes in B2B
Even experienced product marketers repeat the same positioning errors. The most destructive is feature-led positioning: listing capabilities without translating them into outcomes. A buyer does not care that your product has "a customizable dashboard" — they care that their VP of Sales can see pipeline health without waiting for a weekly report.
A second common mistake is positioning for your whole addressable market rather than your best-fit segment. Broad positioning feels safer but performs worse: it produces messaging that resonates weakly with everyone rather than strongly with someone. The companies that dominate their categories — Snowflake in cloud data, HubSpot in mid-market CRM, Calendly in scheduling — did so by owning a specific segment first.
A third mistake is treating positioning as a one-time exercise. Competitive alternatives shift, new use cases emerge, and your own product evolves. A positioning review should be on the calendar at least annually, and immediately whenever win rates decline or a new competitor enters the market.
For the broader strategic context in which positioning sits, see our go-to-market strategy guide.
Align your team on positioning in Hatch
Hatch's free plan builder includes a positioning module where you can document your canvas, share it cross-functionally, and connect it directly to your campaign calendar.
Free Plan ToolFrequently asked questions
How is positioning different from messaging?
Positioning is the internal strategic document that defines how your product should be perceived. Messaging is the external expression of that positioning in copy, headlines, and sales scripts. Positioning comes first; messaging translates it for a specific audience and channel. If your messaging feels inconsistent across channels, the root cause is almost always an unresolved positioning question.
How do you test whether your positioning is working?
The best proxy metrics are sales cycle length, win rate against specific alternatives, and the quality of inbound leads. If your positioning is resonating, buyers arrive already educated and pre-convinced — sales cycles shorten and discovery conversations shift from "what do you do?" to "can you solve this specific problem for us?" You can also test positioning directly in outbound messaging A/B tests or homepage headline experiments.
Should a multi-product company have one positioning or many?
Each product line should have its own positioning built from its own competitive alternatives and best-fit segment. At the portfolio level, a unifying brand position can exist, but it should never replace product-level positioning — the risk is producing corporate messaging that is too abstract to drive purchase decisions. Most successful B2B suites (HubSpot, Salesforce, Atlassian) maintain distinct positioning for each product family.