To stay relevant and in business, agencies and consultants must constantly evolve and offer new services. However, making your customers realize that you can do more for them isn’t always easy.
This Post At a Glance
- As technology, markets and possibilities evolve, so must agencies, freelancers and consultants who are forced to reposition.
- “Brand positioning is an act of designing the company’s offering and image to occupy a distinct place in the mind of the target market.” – Philip Kotler
- Many companies make no active effort to position themselves and instead end up with a position that limits their ability to sell new services to clients, requiring costly repositioning later.
- Businesses are always affected by their positioning strategy, even if they don’t intend to grow.
- I discussed repositioning with Todd Nienkerk of Four Kitchens, a distributed content strategy and technology agency that went from technology to also offer design, then UX, and now content solution strategy.
- Their repositioning strategy includes:
- Simplified message to their market to win new clients and introduced account management to inform existing clients of their new capabilities.
- Actively and constantly communicating with existing clients about work they’re doing for others and can do for them.
- Their strategists think with clients about things they could do together.
- “Demonstrate value, always. Part of moving up the value chain is you have to continue to reinforce the value that you’re providing and the more you do that, the more they want to work with you.” – Todd Nienkerk, CEO of Four Kitchens
Why Repositioning Is Important
We’re in a fast-moving business. Technology and the possibilities it offers keep moving at what seems to be an ever-accelerating pace. That means that the problems we once set out to solve for our customers constantly change or become irrelevant. We need to keep up with customer needs as well as technology and market evolution.
The largest obstacle to that isn’t with agencies or freelancers. Most digital service providers are curious and learn new tools and technologies. The problem is to convince customers that your capabilities have evolved, just like their needs. To use a marketing term, agencies need to reposition themselves constantly to remain relevant.
Lisa and Karl, a Freelancer Scenario
This isn’t a rare scenario. I’d wager that every freelancer, consultant or agency has at some point lost a customer over lacking repositioning. Imagine that Lisa is a freelance web designer who once built a website for a small store. The store owner, Karl, has been happy with it for years but now he wants to add e-commerce. He starts looking for an agency that does e-commerce. Calling Lisa isn’t even on Karl’s mind for a second. In his mind, Lisa does web design for small to medium business. E-commerce is a totally different concept. To Karl, e-commerce and web design exist in different mental categories. These categories do not overlap.
Despite a good relationship, trust, and rapport, Lisa misses out building an e-commerce store for Karl. This, even though Lisa knows Karl and his business quite well. She also knows e-commerce. She just hasn’t informed Karl about that fact. Lisa hasn’t invested in repositioning herself to her clients.
It’s in the Mind of the Prospect
Chances are something similar has happened to you, whether you know it or not. The reason is something called positioning, which refers to how consumers understand the product offering and how it differs from similar competitive offerings.
Al Ries, who popularized the concept in the ‘80s, defines it as such:
“Positioning is not what you do to the product; it’s what you do to the mind of the prospect. It’s how you differentiate your brand in the mind. Positioning compensates for our over-communicated society by using an oversimplified message to cut through the clutter and get into the mind. Positioning focuses on the perceptions of the prospect not on the reality of the brand.”
Effective positioning is used to conceptually package a product’s features in relation to competing products. Here are some examples:
- Colgate toothpaste is protective.
- Coca-Cola brings happiness.
- Axe deodorants have a sex appeal.
- Volvo cars are safe.
You may not agree with all of the above. I surely don’t, but that isn’t the point though. The point is:
“Brand positioning is an act of designing the company’s offering and image to occupy a distinct place in the mind of the target market.” – Philip Kotler
Even if you didn’t agree with the positions above, I bet you recognized them. That means that the positioning work has been successful. Good positioning strategies are relevant, clear, unique, desirable, deliverable and recognizable. They’re consistent with the brand and the attributes that are associated with it.
Positioning Often Happens Unintentionally
Problem is, there are countless businesses that never consciously consider their positioning strategy. They just happen to end up in a mental category of their buyers. This can be damaging as the position they end up in could be inaccurate or too restrictive. Smart brands design and choose a position that is convincing yet at the same time not too narrow.
In the case of Lisa and Karl, Lisa’s position in Karl’s mind was way too narrow. According to Karl, Lisa is in the business of web design, not e-commerce. This isn’t Karl’s fault, it’s simply how he perceived Lisa. Just like many freelancers before her, Lisa never spent the time to sit down and define her brand position. She had other priorities. As a result, and without her consciously choosing it, Lisa’s position became: “Lisa designs websites.”
Growth and Changing Skills Force Companies to Reposition
The dilemma I described above isn’t unique to freelancers. Agencies and consultancies are also under pressure to evolve, regardless of their owners’ or directors’ goals.
Those That Want to Retain Market Share
Some agencies may not way to grow and just keep the same market share. I know several companies that value other things than growth. They’ve reached a size they feel is right for them. There’s comfort in constancy.
However, they are not an island. Their customers’ needs change and so must they. To remain relevant they’re required to update their skill portfolio and repertoire and consequently also invest in repositioning. After all, who would hire a Myspace page designer today, huh?
Those That Have Fun and Wish to Keep the Best People
Many of us were initially drawn into the digital agency business by our love for technology and doing something that’s fun and exciting. But what was new and fun two years ago may not be fun still. People everywhere want to learn new ways of working or changing their specialty altogether. A ceiling for personal growth and learning is a very common reason for people, regardless of role, to quit and look for a new job.
This is a major pain for a large business that cannot easily accommodate their staff’s need for growth and skill diversification or attract new talent. Their position may very well be that ceiling. The agency that started off building WordPress sites a decade ago may have to work on repositioning itself to building web apps in order to meet its employees’ desired to learn React and Vue.
Those That Desire to Grow
Other agencies may wish to grow by widening their service offering and climbing the value chain (we’ll get back to what this means). That requires repositioning the business to serve different or more needs of the same customer segment or finding a new segment to serve.
Using Repositioning to Change Your Place in Your Clients’ Minds
The solution to changing your position is called repositioning. Essentially, repositioning is about changing your services’ place in the minds of your buyers and changing your image or brand. Repositioning isn’t without risk. It may confuse some consumers who have already mentally categorized you or your brand. This is why some companies choose to create new brands and identities rather than try repositioning their existing brand.
Chances are you associate this concept with rolling out massive and expensive marketing campaigns. For large consumer brands, it’s one way of doing it. Smaller businesses and especially B2B service businesses need different tactics.
How Four Kitchens Manages the Challenges of Repositioning As They Evolve
I wanted insight into how a digital agency would approach the problem of repositioning themselves to existing and new customers. I called up my friend Todd Nienkerk , CEO of content strategy agency Four Kitchens.
I’ve previously interviewed Todd about their forays into AR and VR and other types of immersive content. Now I was curious about how Four Kitchens tackles the challenge of positioning themselves as an agency that still builds websites but also works with immersive content.
I asked Todd to tell me a bit about their history as an agency. He told me they started as a pure implementation shop back in 2006: “People would give us designs and we’d turn it into a website, usually on Drupal or WordPress.” They didn’t have much say in that and typically worked with in-house teams or marketing companies that already had a design partner. Todd said they didn’t mind, the work was interesting and there was plenty of it.
From Tech Implementers to Designers That Understand Tech
Over time their interests changed. Todd and his co-founder Aaron have design backgrounds and some of the design work they had to implement wasn’t done with business or user goals in mind. Furthermore, many designs weren’t made with the technology in mind or to be scalable and consistent across multiple parts of a website.
When their technical co-founder David Strauss left (to co-found a company called Pantheon), they decided to focus more on design work in order to have more control over how things could be built. Todd elaborated: “We felt like we had a lot of value to offer clients because we had this insight and we just felt like designers and developers should be working together more closely and that would result in a better and more efficient product and easier to manage budgets.”
Moving Up the Value Chain Requires Repositioning
They’d already been doing bits of it but never advertised it as a service. In the beginning, they had to do the design work at a lower rate than usual or for free to build their portfolio of design work. They were eventually doing a mix of design and development work. “We realized that the next service up the value chain was UX. So we hired a UX strategist. Totally on speculation like we had no demand for that work.”
They gave it a year to see if they could sell and provide UX services. Their newly hired UX strategist spent her first nine months helping promote and market this new capability to new and existing clients. After nine months of doing that, her hands were full of work. She later became their Director of UX and has since built a team of UX designers at Four Kitchens.
I asked Todd what their next goal is now that they’ve repositioned from being a technology implementer to an agency capable of providing strategic UX design. He said they want to go further up the value chain. The value chain is a useful metaphor: “So when you’re at the bottom of the value chain you’re the last person to touch something. You’re the implementer. You’re the software engineer that builds the thing. The level above that is: you design the thing. The level above that: you did the research to figure out what the designs should accomplish. But there are a few layers above that even that we are expanding into currently.”
What’s a Value Chain?
A value chain is a set of activities that a firm operating in a specific industry performs in order to deliver a valuable product or service for the market. The concept comes through business management and was first described by Michael Porter in 1985.
“The idea of the value chain is based on the process view of organizations, the idea of seeing a manufacturing (or service) organization as a system, made up of subsystems each with inputs, transformation processes, and outputs. Inputs, transformation processes, and outputs involve the acquisition and consumption of resources – money, labour, materials, equipment, buildings, land, administration and management. How value chain activities are carried out determines costs and affects profits.” — IfM, Cambridge
New Customers, New Problems to Solve
Todd has noted that they have noticed that moving up the chain affects their clientele: “What we’re learning is that the more things that we expand the further we move up, the more mature clients we attract. Because those more mature clients realize that development isn’t something that happens at the end, it’s something that happens throughout. But you need to have a team that does everything from top to bottom.”
He emphasized they’re fundamentally a technology company and that is their origin. They do service design and solution strategy but they are developers at the core. Other agencies have started at the other end, moving from business consulting to technology. That is neither better nor worse, said Todd. It just presents its own set of challenges which require a slightly different perspective.
For an example of this kind of analysis, check out the Before-During-After Model that we wrote about a while ago.
Solving Business Problems For More Impact
“The client at some point realizes ‘we have a problem or we might have a problem and I don’t really know what it is and I don’t really know how to fix it.’ And we want to be there. Because that allows us so much more impact and control over what gets built.”
When they started as a tech implementer they helped clients that already had a design. That meant someone had already done the research, identified the business problems, and how to approach them. When they shifted to also providing UX services, they started working with those who worked on business problems. Todd said: “Where we’re trying to move now is into helping people solve business problems and we’re calling it solution strategy.” He added that others might call it service design or business analysis.
Todd summarized the basic idea: “The client at some point realizes ‘we have a problem or we might have a problem and I don’t really know what it is and I don’t really know how to fix it.’ And we want to be there. Because that allows us so much more impact and control over what gets built.”
“We’re a Content Strategy Agency”
Todd told me they have, with solution strategy in mind, have rethought how they approach customers or sell their work: “If you have content and if you have problems with your content we are the people to talk to. So we want to do end–to–end content strategy, content management, and content publishing,” he explained.
While they currently don’t have any content strategists on board, Todd said he expected they would have within the next year. They provide the platforms, processes, and structures needed to deliver content. He said: “We work with a lot of organizations that have to deal with a ton of content like universities, corporate intranets, and marketing sites and, non–profit associations.”
Aiming to Do More Strategic Work in The Next Five Years
I asked Todd where he sees their company in the next five years. “Where I would like to be in terms of services is providing much more strategic work with clients, having analytics people and content strategists on staff, and expanding the number of platforms that we support.” Four Kitchens is a well-known shop in the world of Drupal but they’re also looking at other CMS’s.
It’s clear that Four Kitchens has managed to quite successfully grow out of its initial position as a technology implementer and that the agency has a solid plan for the future. Repositioning from being a tech implementer to a UX-capable agency wasn’t without cost. As Todd explained earlier, creating that mind shift took nine months of sales and market communication work.
Repositioning Is About Breaking Into New Mental Real Estate
“It’s very hard to be the first person they go to where they say like ‘hey I don’t know if you do this or not, do you do this? Because I’d love to add this to what we’re doing right now.’”
Looking to the future, I asked Todd what they’re doing to repositioning them as a content strategy provider and partner: “It’s really hard, as you know, to control how people think about you,” and elaborated: “The hardest part, the most urgent part, of course … is getting people to understand all of the services you provide. And especially when you have new ones and then remaining top of mind for them because it’s much easier for them to learn what you do once. Or to think of the work that you are capable of doing as only the work they’ve done with you so far.”
He said that when clients need something else they will generally start asking their friends and asking around along the lines of: “hey do you know someone who does this other thing?”. He added: “It’s very hard to be the first person they go to where they say like ‘hey I don’t know if you do this or not, do you do this? Because I’d love to add this to what we’re doing right now.’” Todd says they haven’t worked on this much in the past but it’s where they’re putting a lot of efforts right now that they’re positioning themselves as a content strategy agency.
“So You Guys Are an AR/VR Company?”
“The thing that’s confusing about the AR/VR step now is when we go to events and we have our AR/VR stuff and we have our demos and we’re showing people that things. Almost 100 percent of the time, what they say is: ‘so you guys are an AR/VR company?’” But the message Todd wants to get across is “we are a content company.” That AR/VR is just the latest expression of content is a bit too nuanced for some people to get. “They want to take what you do and plug it into like a very preconceived hole, like ‘oh you make websites, got it!’ And it’s set in stone. We try getting them to think about like we also do research and design and all these other things but they’re like ‘yeah, but you make websites, right?’.
A Multipronged Approach to Agency Repositioning
“Demonstrate value, always. Part of moving up the value chain is you have to continue to reinforce the value that you’re providing and the more you do that, the more they want to work with you.”
Todd says their primary tool for repositioning is marketing. They have several efforts in place.
A Clearer Value Proposition With Room for Growth
The first one relates to communicating their value proposition, or what they offer, to new clients: “The more we move up the value chain, the more we can say we start all the way up here and then we do everything to make that happen,” he continues: “So we can be sure as soon as you realize you need this thing we can do that and everything. That follows.” An example would be a client looking for user research. Todd says they can be assured that his agency will be able to create designs and specs based on those findings and implement them in code too.
He said this message helps when approaching new potential clients. It’s still not an easy sell. However, it gets even hard when approaching existing clients since they only know what you’ve done for them so far. They keep coming back for that specifically.
Investing in Account Management
The second effort is to roll out an account management structure for the existing clients. Todd said it involves two things: “An account manager and the account manager’s job is to be a point of escalation. If there are problems with the project or something that the client can’t work out with the PM or whoever they’re working with. It’s somebody who checks in with them at least once a quarter to do like a thermometer check. We have tools like we’ll send every client an email every three months that says hey how do you feel about working with us right now.”
Using Communications Plans to Help Clients See New Possibilities
“We also have communications plans any time we have a new site launch or a new service or a new interesting blog post. We target specific clients on a regular basis to remind them like ‘Hey we love working with you, here’s another project that we just did this other project is interesting because it involves this, this and that. If you need those things we do those things, here’s proof, here’s a case study.”
Todd said they’re constantly reaching out to existing clients and talking about what they’ve been doing for other clients in the same and other industries. This is very early work but it’s something they’re investing in.
Talking About What We Are Doing Now and What We Could Be Doing Together
“It’s like internal sales and marketing with existing clients,” Todd explained. The account managers work together with the solution strategists to provide even more value to clients. Todd explained that they now assign a strategist to every client relationship, free of charge: “That strategist’s job is to think about what work are we doing with them now, how is that part of a bigger picture and what work can we do with them next.”
“So we have this account manager who’s telling them about what we’re doing. We have a strategist who who’s like a PO who’s actively working with them about like ‘hey we thought about doing this feature’ or ‘you know we just implemented this thing with another client it might be useful here’ or ‘do you think you can go dig up some funding to make that happen?’”
The third component, Todd said, is integrating analytics and offering a regular report with analytics that they’ve interpreted for the client: “Doing analytics reports and talking to them about it and having suggestions about what to do next will just generate more work.”
Demonstrate Value, Always
The takeaway, Todd says, is “Demonstrate value, always. Part of moving up the value chain is you have to continue to reinforce the value that you’re providing and the more you do that, the more they want to work with you.”
I’m excited to see where this journey will take Four Kitchens over the coming years. I look forward to following them.
As always, Todd is more than happy to hear from you so don’t hesitate to get in touch.
Did this post inspire you to do something about your company’s positioning and repositioning? If so, what? I’d love to hear it!
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