TL;DR
Now, they’re increasingly abundant.
…and not just because of AI. Even without AI, we’re all working with 25+ years of collective institutional knowledge at this point.
B2B SaaS and technology as a whole have grown up. Categories and competitors have multiplied. Playbooks have been built and rebuilt. Our best practices were reasonably well optimized BEFORE we had chatbots that could do our jobs for us.
As of the day I’m writing this article, my belief is that AI productivity gains are real, but the generalized maturity of the technology industry is the more profound change.
But let’s be honest. In the emerging world, every step in the process, from discovery to ideation, design, and engineering, will run much faster and cost much less.
In the days when the cost of building was sky-high, simply achieving product-market fit with your functionality was enough to get a product off the ground, build momentum, and with luck and a few smart moves, cross the chasm into a mainstream market.
I submit that the marketing problem Geoffrey Moore called the “crossing the chasm” is no longer the second chapter of a tech marketer’s existence.
It’s the middle of the first chapter. And the way to cross it isn’t just by marketing the right features. That’s just your ticket to the party.
If you want to scale a company and build a lasting business, you need leverage, not just functionality.
Product-market leverage.
I define this as an outsized ability to command the attention of a market, reach all of its buyers, and build efficient pathways to purchase and realized value. When you have product market-leverage, the game comes to you.
The best-positioned products that dominate categories and keep winning even as competitors pile on…this is what they do.
…and yet, the typical approach to positioning B2B tech products can feel like a game of Pin The Tail on The Donkey, where we curate our best features for a market segment that we think wants them.
I do positioning for a living. I am deeply aware that I stand on the shoulders of giants.
Thanks to April Dunford, Ries and Trout, Tony Ulwick, Geoffrey Moore, and many other groundbreaking thinkers, I have a thriving business and a career that I genuinely enjoy. I owe them all.
But as AI turns the world upside down and the tech industry advances further into full-blown maturity, a flaw in the traditional literature around positioning leaps out at me.
It’s the assumption that positioning rests on product capabilities alone.
Even before the marginal cost of shipping more features started sloping downward, this idea troubled me.
The dynamics of competing in a mature, crowded landscape are different, and I’ve long felt that B2B marketers overrely on habits and beliefs we picked up when categories were younger and bubblier.
The dawning era of AI hyper-productivity makes the contrast even more jarring.
And yet, somehow, we have a generation of B2B technology marketers who seem to think that all they need to do is be clear about what their products do, and they’ll win.
Achieving product-market leverage is bigger than that. By a lot. The good news is that the concept is easy to understand. I like to break it down into what I call “The Four Cs of Competitive Advantage.”
(Yes, it’s lame. But it’s easy to remember.)
The Four Cs are a big part of my positioning practice, which I’ve written about in a long article. But the concept is important enough that I wanted to break it out into its own piece.
They are:
This is not a new idea. It’s a continuation of some very old ones. The 4Ps of marketing are 50 years old. The intellectual basis for the idea of category creation is more than thirty years old. (I credit Geoffrey Moore in Crossing The Chasm, published in 1991.)
If you’re reading this, you probably know quite a bit about product capabilities. I do think that’s an important topic that is getting more nuanced in the AI era, and I will be writing about it. But enough good stuff has been said about product capabilities that I’m going to let it lie for now and give an overview of the other three Cs.
I’ve been in countless situations where founders and product leaders massively overestimated their credibility and underestimated the credibility of their competitors, and then wondered why they lost.
Let’s call a spade a spade. There’s a very old, very well established habit of bullshitting in the tech industry. Founders have a tendency to create “reality distortion fields.” For years, we talked about changing the world as much as we talked about software.
We made big promises, oversold transformational impacts, and didn’t quite deliver. I have epic stories corroborating this. I have personally witnessed acts of messiah-complex narcissism, outrageous hype, and flat-out lies that would curl your hair.
I will not share those stories, though. In my business, discretion matters. So you’ll have to trust me, but also trust yourself. How many big tech company promises have you seen that didn’t pan out?
So even though WE are telling the truth when we talk about the power of our products, can we blame our buyers for being jaded?
This problem is especially brutal when you’re moving upmarket. We’ve all uttered some version of “Nobody gets fired for buying IBM,” but somehow it comes as a surprise when enterprise buyers choose an objectively worse product over ours because it comes from a well-known provider.
The simple fact is that category leaders are more credible. Bigger, older companies are more credible. Companies that buyers have bought from and products they’ve used are more credible.
But just because you’re a challenger doesn’t mean you can’t build credibility. While it’s true incumbents have a lead, credibility can be built, bought, and stolen. You might not naturally be the most credible provider, but you might have advantages that can help you become one.
I recommend considering four sources of credibility: Legacy, reach, relevance, and content, each of which breaks down into subtopics. (I will structure the whole article that way. Source, then subtopics.)
It’s indeed true that larger, older companies have more legacy advantages than younger companies. But I’ve worked with well-established category leaders who downplay their dominance and upstart challengers who sit on a powerfully relevance advantage. Even if you’re a young company, don’t sleep on your legacy.
Legacy subtopics:
This is true across every category: Famous brands win more than obscure ones. You’ve probably heard people say that top-of-mind awareness is critically important and that most B2B technology purchases go to a provider from the day one shortlist. Like legacy, reach is another advantage that favors bigger, older, richer companies. But when you dig in, there are plenty of advantages available that don’t require years and millions of dollars to build.
Reach subtopics:
Relevance is the only credibility advantage that clearly favors younger challenger companies over established leaders. When you’re a leader, you’re compelled to be all things to all people. When you’re on the way up, it’s much easier to focus on a target segment or persona, offer a critical point of view, and be a firebrand.
Relevance subtopics:
You could argue that content spans across all credibility advantages. If content is just a generic word for a vehicle for sharing information, then sure. But I do think there are content-specific opportunities to drive credibility that somehow get missed, even in a world where we’ve been hyping content marketing for more than a decade.
I like to consider these topics:
Convenience is brutal. We spend years obsessing over building the perfect product, spending every waking moment agonizing over every feature…only to see our masterpieces lose out to a product that does half as much and costs more, but is easier to buy.
Beware: Convenience is a massive, unspoken driver of purchase behavior. My general recommendation is that every company should do everything possible to make its products easy to buy. But B2B technology is a funny place where many of us act as if inconveniencing our buyers is no big deal. So you might have a big advantage to gain by investing in making your product notably easier to buy.
To explore convenience advantages, I look at three sources: awareness, distribution, and buying process.
Awareness is a big subject that I’ve touched on already. But it’s worth saying it again: you are much more likely to sell to people who know who you are and what you do. The same awareness that makes you more credible also makes you easier to buy, simply because your buyers don’t need to exert any effort to find you.
Awareness is a subject that should be pretty basic and obvious, but I do think there are three subtopics worth keeping track of that help you assess and work with your level of awareness.
Awareness subtopics:
Distribution is another tough one for early-stage companies. Building an ecosystem of distribution channels is hard, time-consuming, and often frustrating. And it’s one thing that AI isn’t going to do for you (....as of the publication of this article, anyway.) And yet it truly matters.
The days of “build it and they will come” are long over. (And I’m not even sure they ever really existed in the first place.) The simple fact is that access to buyers and the ability to sell are crucial to any company and any stage of its existence, and inferior products routinely beat superior ones on distribution (cough, cough, Microsoft Teams).
Distribution subtopics:
In many cases, the buying process itself makes a product easier to buy. Swift, painless onboarding is a tentpole of product-led growth. But you don't have to be product-led to create buying process advantages.
But let’s be real: if everyone in your category offers free trials and frictionless upgrades, then it’s table stakes when you do it, not a real advantage.This applies across all competitive advantages, but people especially fixate on optimizing the buying experience as if it will unlock transformational growth. An echo of 2010s-era “growth hacking,” perhaps.
Keep yourself honest about what really moves the needle.
Buying process subtopics:
Despite brow-furrowing from high-minded executives and consultants, it’s an indisputable fact that many products win by being cheaper. (Or being perceived as cheaper.) Whether you or I like it or want to go there, delivering more value for lower costs is definitely a source of competitive advantage. That doesn’t mean just lowering the price tag or taking a bath on profitability just to win customers. It’s about framing the monetary value and impact of your product and shaping the business case, too.
Because cost is more straightforward, I’ve found that it doesn’t break into “sources” like the other Cs do. It’s all about value for the dollar. But I do think it does contain a number of subtopics.
The first is to take stock of the reasons why your competitors win deals you think you should have won."
The second is to understand why you consistently win.
My favorite time to reference the 4Cs is during the 'winning differences' step of my positioning process, which I describe in detail here.
As I mentioned at the top of the article, this framework was inspired by the narrow and limited perspective on competitive advantage built into most of the literature about positioning. So my personal use case is to build this into the natural flow of a positioning conversation.
But it does work as a standalone exercise, which you can use for competitive intelligence, product marketing, or product strategy. To make a standalone 4Cs exercise easier, I built out a Miro board focused purely on the 4Cs, which you can use as you see fit.
Access the 4Cs Miro Board here. You just need to copy and paste it into your own board, and it’s yours.
Whatever you do with it, the goal should be the same:
To distill down a short, accurate list of the advantages that consistently help you source and win customers. If you can’t do that (or you can’t do that honestly), it’s all for naught.
My baseline approach is to go very wide at first. Everything that obviously is or realistically could be an advantage for you should be on the table.
Then, boil it down, based on three criteria.
The reality is very few advantages will make it through that gauntlet.
You might have a couple. Maybe just one.
Something to keep in mind is that most category leaders drive their initial wave of momentum with a single (but crazy powerful) advantage.
Quality beats quantity a lot of the time.
