How B2B companies need to win in mature, crowded categories

• There have never been more brands than ever before. Mature categories are full of products and service providers who have the same features and capabilities.
  ‍
• Only 1-2% of the companies can win on innovation. Others should pursue a different strategy: taking a fundamentally differentiated position in the market. Choosing a particular set of customers to serve.
  ‍
• Invest in buyer intelligence. To out-market the competition, you need to get to know your chosen target customers better than anyone.
  ‍
• Know how what you're saying to the market is landing on them. It's very hard to refine your marketing and product messaging unless you know what they think of it.  
  

Look at any mature category ​​— almost every competitor does all the same things. Every CRM, email marketing tool, or landing page builder has every feature.

If you compete in an existing, mature category (98% of us do) — you cannot win by being objectively better. Why is that? It's just too hard. Whatever stuff you build that buyers want, others can replicate it relatively fast.

Challenge: name a product that is objectively better than its competing products.

It's hard. 

Google Search is one. Tesla might have a leg up on other electric cars (for now). Hard to name objectively better products that are not category-creating (e.g Gong) and/or not owned by multi-billion dollar corporations.

Feature-based differentiation is going away, and mostly already has. Winning on capabilities would mean you need to win on innovation, most can't do that.

But you can and should win on brand.

This means winning on a narrative (context for your capabilities), positioning (who's this for, for which use case), messaging (words you use to make your case).

You need to do 3 things to win if you’re not the category leader

There have never been as many brands as there are today. Most companies in any given category look the same and do pretty much the same things.

Sameness is pervasive. The majority don't have enough money (nor ideas) to win on innovation but play the X+1 feature game anyway.

Winners in this saturated world are taking a fundamentally differentiated position in the market.

1. Take a fundamentally different position in the market

Don’t compete on features. If your core concept isn’t working, rework the narrative and the description of the product rather than adding new stuff.

Make sure you’re creating a product that competes because it’s taking a fundamentally different position in the market. 

Here’s how:

• Know the other players in the market (mainly the leaders), how they’re positioning themselves, what the key target audience and use case is. Pay attention to the messaging they use, what they focus on as their key differentiator

• Choose your customer. The ability to innovate on customer value at high speed must be a core capability of your company. It's impossible to do so if your company is targeting all revenues indiscriminately. If you treat all revenues as equally desirable, you don't have a strategy. Target a defensible market segment, create a business model that enables you to win against competitors who are going after the same segment.

• In terms of the targeted customer, overlap with the category giant minimally: only go for their least profitable customer segments where they won't fight you. If you take on the category leader directly, they are in a position to crush you. Longer explanation in the video here.
  

• Focus on increasing your customer value (be more useful), and lowering your cost to serve (high gross margin) — for the select group of customers. By being very particular about the customers you serve, you can build a 10x solution for them. To win, your company has to be the best at something. You *can* be better if you are targeting better.

• To get inside the very limited consideration set of the buyer, you need to commit to solving the different jobs-to-be-done in their mind. Build up mental availability for this very use case. I've written about this in detail here.

2. Understand your target customer better than your competitors

If you know what your customers want and how they want it, you have a massive advantage. Companies that invest in learning what resonates with the people they're trying to influence come out ahead.

It’s very difficult to be objectively better while you also cannot be objectively worse. So you need to win by being more relevant, timely, and doing better marketing. This starts with really knowing what matters to them and what they don’t care about.

For each of your ICPs, you need to know:

• What are the pains they’re trying to avoid?
• What are the gains they’re trying to get?
• What are their jobs to be done?
• How are they measuring success? Which metrics are they looking to move? What number is their boss asking them for?
• Which channels are they using (where you can reach them)?
• How much are they willing to pay <for your product>?

If you know these things, you make your messaging on your website, emails, and ads more clear, relevant, aligned with customer actual priorities. In a nutshell: more compelling.

3. Know how what you’re saying to the market is landing on them

You can only improve what you can measure. If you don’t know how your positioning, messaging and marketing are landing on the intended customer, you’re blind when you don’t have to be.

You need to know what your target customer thinks and feels when they come across your messaging. Are the leaning in: "wow this is great"? Or are they rolling their eyes, quickly skimming over everything and moving on to other things?

Odds are, you have no clue. We can measure every click and scroll on the website, but before Wynter came to the scene, measuring how effective the words are was extremely difficult.

There are 3 major parts of your product and marketing messaging, and you need to evaluate each:

1. Value proposition. Does your succinct pitch resonate?
2. Overall messaging. When they read most everything, do they want to sign up/get a demo/buy?
3. Differentiation. Do they get why they choose you over alternative options? If I'm your ideal customer, do I see that?

1. A value proposition is a promise of value to be delivered. It’s the primary reason a prospect should buy from you.

You want to validate whether the TL;DR of your pitch is as compelling as it can be:

• Why are people buying from you? → Ask your customers who recently did
• Why are people choosing to not buy from you? → Ask your target market
  

On your site, your value proposition is the main thing you need to test—if you get it right, it will be a huge boost. The less known your company is, the better your value proposition needs to be.

Your value proposition has these 3 components:

1. what you are (the category you're in, e.g. email marketing tool)
2. what problem you solve
3. why you are different (why choose you)
   

A value proposition should elicit a response like “Tell me more”, or “How do you do that?” or “I want it”.

2. Messaging is what you say

Messaging is the key message you want to communicate to your audience(s).

Copy is you elaborating on those messages, finding the best words to communicate it. Copy the manifestation of messaging, it's what the users actually come across. So when I say "messaging", I include copy under that umbrella term.  

To compete and win, you need to know what in your messaging is hitting home, and what's missing the mark.

What is truly resonating with customers and capturing their attention? What do they care about? On the flip side, what are things they perceive as table stakes or what they don’t care about?

Understanding this will help you add more clarity, talk more about the things that work, and re-word or cut the parts they don’t care about (giving more attention to bits that matter). You will also learn about messaging hierarchy — what matters the most and the least (which should be reflected in the order of content blocks on your site).

Most messaging is a 'meh' — because companies don't know what's working or not.

Use these 5 heuristics to assess your messaging:

1. Clarity: do they get it? After reading everything, what's still unclear? What questions do they have? A confused mind doesn't buy.
   ‍
2. Relevance: does it align with their priorities and challenges at hand? If the message is not about what's important to them now, it won't work.
   ‍
3. Value: do they want it? Effective messages increases user motivation to take action. Don't just describe things and hope for intrinsic motivation. Make a case of how your thing adds the value they seek.
   ‍
4. Differentiation: why choose you? Is it clear why go with your offer instead of competing solutions? Don't talk about yourself as if you're the only one doing what you're doing.
   ‍
5. Brand perception: do we come across the way we want to come across?

3. Differentiation or why buy from you?

Your value proposition and messaging might be spot on, but what if everyone else is saying the same thing? They probably are. After all, sameness is the default.

In fact, if you look at the top 20 sites from large categories, they all pretty much same the exact same things. The customer in that case will choose either the best known — the category leader — or the cheapest.

You need to be clearly different and/or better to win more customers.

When your ideal prospect is on your site, they should be able to figure out relatively easily how you're different and/or better. This again starts with choosing a differentiated position in the market and knowing more about the market and the customer than other players.

Won't others copy your differentiation messaging?

Differentiation is not a line of copy you write. It absolutely has to include your overall product and brand focus.

So you must be actually different (focused), and then communicate that. In the end, everyone wants to be different. A key part of your goal in strategy is to figure out how to focus on a space in a way that encourages others to play elsewhere and/or differently.

After going through your website, the customer should be clearly able to explain why choose you over others.

‍

Out now: Watch our free B2B messaging course and learn all the techniques (from basic to advanced) to create messaging that resonates with your target customers.