The Three Positioning Strategies
When you need this method
You are facing a market entry or relaunch and must decide which competitive arena to play in. Companies that never make this choice deliberately usually end up head-to-head against established vendors with bigger budgets, the most expensive and riskiest of the three paths.
Approach
- 1Assess whether you can beat the incumbent directly (head-to-head): only viable with clear superiority and sufficient resources.
- 2Alternatively, identify a sub-segment whose requirements the market leader serves poorly and dominate it (big fish, small pond).
- 3As a third option, check whether a genuine market shift justifies a new category (create a new game), the most demanding strategy, because the category itself has to be explained first.
- 4Weigh the choice against resources, evidence, and timing, then translate it consistently into messaging and go-to-market.
Typical application
A typical case: a young B2B SaaS in the HR space considers presenting itself as "the better alternative" to the market leader. A resource analysis shows a direct attack is not fundable. Instead, the team focuses on a segment with specific compliance requirements that the incumbent serves only generically. In that smaller pond the company becomes the first choice and builds the references for later expansion.
Limits and counter-indications
The strategy choice is not a one-off decision; it must be revisited as the company grows. "Create a new game" is frequently underestimated: without a genuine market shift and substantial budget for category creation, the approach fails. A pond that is too small caps growth.
How to measure impact
A suitable observation: win rate in the chosen segment and the share of deals where you are seen as the first choice rather than an alternative.
Related methods
Sources
- 1.Blue Ocean Strategy (opens in a new tab) · Harvard Business Review (W. Chan Kim, Renée Mauborgne) · 2004 · academic and scholarly literature · supports the underlying mechanismIntroduces the distinction between competing within existing market space and building new, uncontested market space, and backs it with a retrospective review of 108 business launches. The review has no control group, so it supports the distinction as a framework rather than as causal evidence.
- 2.A Quickstart Guide to Positioning (opens in a new tab) · April Dunford (aprildunford.com) · no date given on the page · practitioner source · describes the methodCarries the choice between an existing market category and a newly created one, including the warning that category creators often lose the market to later entrants.
Origin: Dunford