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Positioning Technology Products – Don’t Sell the Swiss Army Knife!

In my consulting and speaking work with technology companies, I am frequently asked a question – how should you position a mass market software product that has thousands of features for a specific customer segment? Consider products like Microsoft Office, Intuit’s Quicken or Adobe Photoshop. These are gargantuan products that have evolved over decades and are marketed to a very broad set of customers. These products have features galore and offer something for everybody. Positioning these mass market products seems to fly in the face of a basic tenet in product positioning – that you must define the target audience precisely and as narrowly as possible, so that the benefits you offer are relevant to the audience.

In thinking about this problem, I found a useful analogy – think of these “do-all” products like a Swiss Army knife. The classic Swiss Army knife is famous for being a “multi-tool” – it consists of a number of tools stowed inside the handle of the knife. The number of tools can be dizzyingly large – one giant Swiss Army knife has 85 tools, costs $999 and holds the Guinness Book World Record for the largest number of tools in a single instrument.

Regardless of how many tools a multi-function knife has, customers will only use one at a time. And most customers will use only a few of the tools. So, while the knife may have lots of tools, there are only a few that are relevant to a specific customer, depending on the situation they are using the knife for. So what they will end up doing is to stow away the tools they are not using, and only expose the relevant tool, one at a time. The rest of the tools are there, just hidden away.

And so it is with a complex technology product like Microsoft Office. It is like a giant Swiss army Knife in terms of the number of features and functions it performs. But a specific customer segment will end up using a very small subset of these features. For instance, I am an academic and I also do a lot of public speaking. I use Microsoft Word to write academic articles and therefore I really like the bibliography and cross-referencing features in Word. And I use PowerPoint quite intensively to make presentations. Within PowerPoint, I use SmartArt quite frequently as it allows me to communicate visual concepts elegantly. And I like the new “broadcast” feature in PowerPoint, which allows me to set up a quick-and-dirty remote presentation easily. If I was a salesperson or a lawyer or a high school student or a bond trader, I might use Office very differently. To continue the analogy, all customers use the same Swiss Army knife, but they expose a different set of tools.

So that’s how you should market these products – by highlighting the relevant functionality for each customer segment, while keeping the other stuff “stowed away” because it is not relevant to that customer segment. The same product can therefore be positioned differently for different customer segments, by “dialing up” and “dialing down” the features and benefits that matter most to them. And when you launch a new version of your product, you may “dial up” only what’s new, while not talking about the thousands of features that already exist. For instance, when Intuit launched the 2009 version of its Quicken product, it highlighted the new capabilities for keeping track of your budget and for stretching your household dollars further, keeping in view the economic recession and the fact that many households were seeing a decline in their incomes and net worth.

But too often, I see technology companies sell the “whole knife”, as it were. The pitch – “look how many tools we have in our Giant Swiss Army knife”. The fact is that this pitch will fall flat for most customers, because you are marketing “just in case” features instead of “just in time” features. As a result, your positioning becomes fuzzy and sounds like motherhood and apple pie.

So take a long hard look at your Swiss Army Knife, and stow away the tools that don’t matter when you are marketing your product. Of course, there are two other options. If you are Apple, you separate the tools (the apps) from the knife, and market the fact that people can pick their own tools to attach to the knife. And if you are a niche player like with its Kindle, you can argue that a dedicated knife or screwdriver will be more efficient and effective than a bulky Swiss Army Knife!

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