If you have read my first two posts in the series (Part 1 and Part 2), and followed my instructions, then that means you have done a ton of research and your head is probably hurting right around now.
To help, I will switch gears, and revisit an earlier topic: understanding frames and root metaphors, and explore this within the context of technology categories and market positioning.
Further to the importance of doing the research needed to understand the technology and space (discussed in part 2), one of the key questions is: what is the space? What category of technology does your product fall under?
Categories are important not just to give trade press reporters beats, bloggers soapboxes and analysts toll machines and areas of specialty and reputation building. (If this all sounds too abstract, just think of the words that describe your company at the opening of the press release – the strap line – “Acme, an industrial widgets company, announced today…”)
They pave the way to a greater understanding of the tech universe through a (more or less) neatly ordered taxonomy that places whatever is out there into just the right bucket. Having a good understanding of the space you are playing in – the dynamics of the space, competitive arena, its history, trends and associations – will inform the process of defining your positioning within the space.
Thus, determining the appropriate category is extremely important, and means quite a bit for how you build your story and the words you choose. Choosing the right category can be a springboard to describing your positioning and where you are going within the space (and perhaps how you will change the space or help it to evolve).
The limiting factor here is that your choice of space and positioning cannot be strictly opportunistic, of course it must be credible; call yourself whatever you wish, people will place you in whatever bucket they feel is most appropriate and you will just cause confusion if your choice of category does not mesh with reality.
Also, inventing totally new categories poses challenges because you will need to educate people about the need for the category, and you will spend lots of time figuring out which reporter or analyst is the right one (and convincing them of the same). This is not to say that it is never right to invent a new category – someone had to go forth and market the first PC and network-attached storage appliance, for example – just that it should be done with the understanding that sometimes the only things pioneers have to show for their efforts are arrows in their backs.
Assume the Positioning: What Bucket to Fall Into
When you adopt a category, you also buy into its history, its energy (or lack thereof), and its root metaphors (as described in part I).
Each space has a trajectory, a beginning, middle and end. You can get a better sense of the state of your category by checking out the Gartner Hype Cycle (see illustration above for a somewhat dated example), which seeks to show where technologies are on the adoption curve.
A challenge is that there really is not any single, definitive taxonomy of technology products. Analysts, publication directories and buyer guides, and Wikipedia don’t always agree and may well carve up the tech world differently. Further, it is not just the category you need to decide on, but the subcategory and parent category.
Fortunately, the world of Web 2.0 has given us folksonomies, and ways to get a bead on what really counts: the exact words that real people – customers and potential customers – are using to search for and bookmark Web pages related to technology. You can consult any number of social bookmarking and keyword mining sites to see the words people are using in their searches, and compare various combinations. You can even graphically chart the popularity of terms and phrases and compare them side by side over a given time period on BlogPulse.
These words can play an important role in optimizing your content for search engines. For now, we will concern ourselves with how your category can influence your market positioning.
We Hold these Truths to Be Self-Evident
Below I provide some examples that illustrate my points about technology categories – why it is important to understand their evolution, and the story frames that go along with them.
I started out my IT career selling sales force automation (SFA) software. I marketed one of the first distributed systems (Sales Force Information Manager was MS-DOS based and synchronized data between field workers’ systems and a central server) from a company called XYZT Computer Dimensions. It was in the early 90’s, before the ascent of Windows. At the time, mobile computing meant schlepping around 24 pound IBM “luggable” laptop computers. Even back then, the SFA field was a very competitive, fractured marketplace, with many contenders and no clear leaders.
Flash forward about eight years and a company that some guys from Oracle started called Siebel Systems is dominating the market. Only now the umbrella name for the category has morphed into Customer Relationship Managemenet (CRM), with SFA occupying a subset of the category. Siebel was emblematic of a large vendor selling an enterprise class solution amidst a pack of much smaller competitors.
Important facets of the company’s positioning were its client server platform and industrial strength RDBMS back end. It pitched itself as a best-of-breed vendor that offered a better solution than could be found in larger vendors’ enterprise software suites, and a more comprehensive and industrial strength offering than those offered by smaller competitors and contact management systems.
Flash forward even more years and another company, Salesforce.com has disrupted the CRM market with a SaaS (software as service) offering. The company is perhaps the shining example of the potential of SaaS, and considered to be leading a new wave of hosted enterprise software offerings. Thus, Salesforce.com is an SaaS vendor specializing in CRM.
Or why not take a look at the market formerly known as supercomputing? The rules of the game have been changing here as well. As the technology becomes commoditized – proprietary massive iron platforms are being replaced by systems powered by Linux and off-the-shelf processors – it is migrating to a wider audience and is one of the bright spots of growth in server sales according to analysts.
Techie arcane language that characterized the discourse in supercomputing is being replaced with more enterprise-friendly terminology. For starters, the term “supercomputing” is now widely considered to be dated, and most if not all vendors have jumped on the high performance computing (HPC) bandwagon.
Finally in the world of data storage, ten years or less ago storage jumped out of the server box and onto networks, leading to the rapid rise of storage networking technologies like storage area networks (SAN) and network-attached storage (NAS). Now, some say that storage arrays based on mechanical disk drives have seen their day and should be replaced by solid state drives. Others are saying that solid state is still too expensive.
For each example, at every step, the thinking in the industry and jockeying for position could be tied to truisms in the space as stated below (I am not saying I agree with the statements, just that they represent IMHO the types of thinking that prevailed).
SFA, circa 1990;
Windows will replace DOS; if you are a DOS based vendor you will soon be toast (it did and XYZT was)
The SFA market is fractured and needs a clear leader
CRM, circa 1998
SFA is so yesterday, CRM is the up-and-coming category
Client-server computing is all the rage, mainframes are dead
Best-of-breed vs. suite debate continues, with Oracle the shining example of the former
CRM, circa 2002
Hosted software sounds great but enterprises will never adopt it; their needs are too specialized and the technology can’t scale.
Web applications are not as rich as desktop applications, the browser dumbs everything down
The OS will soon be irrelevant due to the rapid rise of the Web and Web-based computing
SaaS, circa 2008
Soon, all software will be hosted
Where did all the excitement about CRM go?
Web 2.0 technologies like Ajax make it possible to approach the richness of a desktop UI in a browser
HPC, circa 2008
“Supercomputing” is oh so yesterday, just try to find the term on the websites of the major (formerly supercomputing) vendors
Linux and off-the-shelf processors are bringing cost / performance down and bringing the technology to a wider audience.
Storage Circa 2008
Where did all the information life cycle management (ILM) buzz go?
Tape storage is cheap, disk-based storage is relatively inexpensive and has tons of capacity, solid state drives (SSD) are much faster but also much more expensive and light on capacity.
The cost for SSDs is coming down, and capacity growing
SANs are very high performance but can be expensive and complicated to deploy and run
NAS systems are relatively inexpensive and easy to add to your network but can’t scale
Hopefully, this post has helped you to understand the importance of categories, and about the need to dig deep before deciding what can work best in terms of buckets and marketplace positioning.
Next Up: Putting it All Together