■ · Strategy & Growth
Where you compete: positioning and your real edge
Customers have choices. Positioning is the honest answer to one question: why should the right customer pick you over every other option, including doing nothing? If you can't answer it clearly, neither can they.
Positioning is a choice about who you're not for
In Positioning, Al Ries and Jack Trout argued that the battle for customers happens in the customer's mind, and that the clearest, simplest position usually wins. For a small business, that means narrowing down: a specific type of client, a specific problem, a specific way of solving it. "Bookkeeping for everyone" is invisible. "Monthly bookkeeping for small service businesses, with a report you can actually read" is memorable.
Narrowing feels risky because it seems to turn customers away. In practice, it makes you the obvious choice for the customers who matter most, and it makes your marketing, pricing and hiring easier.
Find the overlap
Jim Collins's Good to Great describes companies that focused on the overlap of three things. In small-business terms:
- What you can be among the best at in your market, not just good at.
- What people will pay well for, with a profit margin that works.
- What you and your team care about, because you'll be doing it for years.
Work that hits all three is your core. Work that hits only one or two is a distraction, however tempting the revenue.
■ Stand out on purpose
Change the comparison
W. Chan Kim and Renée Mauborgne's Blue Ocean Strategy suggests competing by changing what customers compare, instead of trying to beat rivals on the same features. They use four questions. Here they are applied to a small service business:
| Question | Ask yourself | Example: a bookkeeping firm |
|---|---|---|
| Eliminate | What does the industry offer that customers don't really value? | Long annual engagement letters and hourly billing |
| Reduce | What could be well below the industry standard? | In-person meetings, replaced by a 15-minute monthly video call |
| Raise | What should be well above the standard? | Speed: books closed by the 10th, every month |
| Create | What could you offer that nobody in your market does? | A one-page plain-English report with three things to act on |
Investigate your edge before you advertise it
Every owner believes they have an edge. Treat it as a claim, not a fact. What evidence do you have? Repeat clients, referrals, win rate, what clients say when you ask why they chose you.
Put each claimed advantage on the evidence board. "Clients love our service" is an assumption. "80% of clients renewed last year" is a fact.
Ask three clients and one lost prospect why they chose you, or didn't. Listen for the real reason, not the polite one. See No Yes Man.
An edge only counts if customers will pay for it. If your advantage doesn't show up in price, win rate or retention, it's a preference, not an edge.
Write your position statement
Use this simple form and keep rewriting it until it's true and clear:
Then test it. Use it on your website, in proposals and in conversations for a month. Watch whether the right clients respond, and whether the wrong ones stop showing up. That's the evidence.
Signs your positioning is too broad
- You compete on price in most deals.
- Clients can't explain what you do to a friend.
- Your clients are so different that every job feels new.
- Your marketing tries to speak to everyone and connects with no one.