When knowing too much is a liability

By Jerry Rackley

I worked at a small software company from 1993 to 2000. It was a great environment and learning laboratory. In fact, some of the most practical and relevant marketing lessons learned during my career came from this period. Quite often, these lessons were learned the hard way, from making mistakes. Fortunately, we were quick learners and, and we recovered from our mistakes. Lessons learned the hard way stick with you.

One of these lessons came as a result of a new, innovative product we developed. The full potential of the Internet as a platform for integrating disparate systems was just being discovered in the mid-90s. Our insightful and technically brilliant CEO conceived of a solution that enabled a web browser to access a mainframe application. At the time we rolled it out, no one else had anything like it. We were truly able to claim that we were first in the category, a very valuable positioning advantage. If only I knew then what I know now about positioning, perhaps we would have had greater success with this product.

While this particular software solution was truly unique, highly differentiated and innovative, it wasn’t smart enough to develop its own market position. In our enthusiasm for this product that we were sure was destined for greatness, we hit the road to show it to much larger companies. We were certain they would fall in love with it and throw a lot of cash at us, either to license it or buy it outright. After all, there were billions of dollars of legacy IBM mainframe applications whose users would surely love to access them via a web browser.

One of our first stops was Netscape, which at the time was at the top of the Internet leadership pyramid. We ran through our presentation, did the demo and talked about the value of access to legacy applications using their browser. The two Netscape representatives listened politely to our pitch and at the end said, “To us, Microsoft Word and Excel are legacy applications.” This should have been our first clue that perhaps we did not do our positioning homework well.

After a few more lukewarm receptions to our pitch, which left us scratching our heads, it dawned on us that perhaps we were the ones that were missing something.  We brought in an outside expert, and while I have forgotten most of his advice, I still remember his concise summary of our problem. After he finished hearing our pitch, he looked at us and said: “your problem is that you know too much.”

He was right, of course.  Our team had spent the better part of the past six months developing this product. We had been drinking our own Kool-Aid, breathing our own fumes and developing intimate knowledge of even the most arcane aspects of this solution. It was our baby and we were proud of it. Clearly, we had lost our objectivity. What was needed was for us to have an out-of-body experience so we could view it like a potential partner or customer would.

The marketing explanation was that we had failed to properly position this product prior to launching it. The result was that initial sales were lackluster, because we had not done the work to help the market understand what it was and why it was needed. We were able to hit reset on this product, and eventually had some success with it. But we lost some of our first-mover advantage, and the market was quickly flooded with competing solutions.

Properly positioning a company and its products is a critical factor for success. When a solution just can’t seem to get traction in the market, often the problem isn’t the product; it’s the way it is positioned. Use the Demand Metric Positioning Statement Worksheet to develop or calibrate the market position for your solution lineup.  And if you need an objective perspective on how to position your solutions, we can help.