John Rougeux:
Okay. There we go. All right, Andy, thank you for being on the show today. It’s great to have you here.

Andy Cunningham:
Hey, it’s really great to be here. Thank you for having me.

John Rougeux:
Yeah, you bet. Well, I know many people have heard of you. Many people have read your book, get to a hob. But I always like to ask my guests, just tell us a little bit more about themselves. Maybe some things we don’t know about you from the a, the professional profile. We are always here.

Andy Cunningham:
Oh, okay. Let’s see. Well, I was a rollerskating hostess in high school, actually, no, it was college. I was in a roller skating hostess for a restaurant in college. I used to play the trumpet. That’s what I was a music major in college and I was a performance classical trumpet player and I live on a boat in Sausalito.

John Rougeux:
Wow. Well I a, I’m actually a former trumpet player myself, which I don’t think I’ve ever mentioned publicly, but

Andy Cunningham:
I got, we all love each other. All the trumpet players love each other

John Rougeux:
A good deal. And and you run a marketing consultancy, it’s called the Cunningham collective, if I’m not mistaken.

Andy Cunningham:
That’s correct. It’s called Cunningham collective. We’re based in San Francisco and we basically help companies position themselves for success in the market and also help them figure out how to get traction for their new positions.

John Rougeux:
Great. Great. And then I mentioned this earlier, but you wrote a book called get to aha. Anything you want to tell us about that before we dive in?

Andy Cunningham:
Yeah, well, the I think the most important thing I’d like to say about my book get to a high is that it is the, I call it positioning 2.0 everybody who’s a marketer, probably read positioning 1.0, which was the Jack trout and Al Reese book that came out in the 70s. A great book on positioning. In fact, they invented the concept. They were they were very prescient, but that was way before the internet and no one has written anything about positioning since then. And so I felt that it was necessary to put a real framework behind how you actually do this. In the 21st century. And so I would encourage you, if you liked positioning 1.0 you’re really gonna like positioning 2.0 or get to aha.

John Rougeux:
Good deal. Well, I’ll have some more questions for you about the book and some of the ideas in there as we get into the interview a little bit further. But one of the questions I, I like to ask guests on this series is how do you define categories and how do you define category creation? Category design?

Andy Cunningham:
Yeah, that’s a, that is a very big and very important question. First of all, a category, even if you look it up in the dictionary category is a group. There is more than one company in it. So it is, it is extraordinarily unusual for a single company to actually create a category. What often happens is a company comes up with something really interesting. They develop a product, they push it forward as much as they possibly can. They run out of money and they die. And then the second company, you know, improves a little bit on that. And it’s not til the third or fourth company that can actually say that they have built a category. So I’ve been involved in many category creations and they involve lots of companies and they involve lots of failure. And so if you’re lucky enough to get the company that’s the fourth or fifth or sixth in the, in the line up with a new idea, then you, you may have the category King, but you’re very unlikely to build a category as the first person going out doing it.

John Rougeux:
An unlikely to be the first. So, so you’ve been involved in this a few times. What are some, what are some examples that you like to bring up when, when that’s happened where the first, second, third, a kind of pioneers out there have kind of fallen by the wayside and it’s someone later on who’s kind of picked up the mantle.

Andy Cunningham:
Well no one remembers the ones that fell by the wayside. That’s the thing about category building. But you can be sure that the ones that have won in any of these categories that you could talk about, they are not the first ones in there. So the ones I’ve been involved with, I was involved with the category creation of video games. I worked with Marie a. Tara was not the first company to create a video game back in the late seventies, early eighties. But they they are the ones who establish that category. Then I was involved in the category creation of what was called back then desktop publishing, which is what Apple and Adobe which actually was a company called all of us, but Adobe acquired it created this incredible new thing about how you could actually publish newsletters on your desktop. That was a category of many companies in many different industries created that category.

Andy Cunningham:
But I was there at the beginning of that. I was involved in the category creation of a very light jets, which is a really fun one deviation space. I worked with a company called eclipse aviation, which invented the category and 10 years later they died because they didn’t have enough funding and a Honda and a few other companies kind of just sat back and watched the failures that we were having at eclipse and jumped in a long after the failure of that company. And they dominate the category today. The Honda jet is one of the best very light jets out there. So anyway, I’ve been involved in a lot of these things and seeing them, seeing them come and go. So category creation is a very big deal. Very expensive. Can’t be the first one. And but it’s a it. But if you are the third or fourth one in, you can stand and make a ton of money by, by building that category.

John Rougeux:
Sure. So what is it about being the first or the second, do you think that leads to failure? Is it, is it trying to come to market before the market is really ready? Is it, is it lack of, you know, capital to just have the staying power to wait for the market to come on board? Or maybe it’s something else.

Andy Cunningham:
I think it’s, I think it’s vision before market is ready is the issue. So a lot of these companies have great visions. I mean if you think about the app, if you think about Apple where I was, I worked with Apple many years ago and the launch of the Macintosh, if Apple, it’s the Apple two hadn’t existed to fund the development and failure of the Macintosh in the first few years, the Mackintosh would not have have happened. It would have died just like all the, all these other companies. I think it’s very it’s, it costs a lot of money. It takes a lot of time. It takes a lot of patients and it really helps if you’ve got some other products that can fund the development of a brand new idea. Visions are wonderful things. They’re all over Silicon Valley. But funding the vision and having the vision meet the market at the right time in the, in the right way is a very hit or miss operation.

John Rougeux:
Sure, sure. And you know, a couple examples that come to mind for me as you’re talking about that are one electric cars, which were I think invented maybe a hundred years ago. Yeah. And then of course, the one you hear about a lot as well as social media and with, there were a couple of predecessors in social media before even Facebook who we’ve talked about plenty of times who have since falling by the wayside. So yeah, that’s a really interesting perspective cause I haven’t heard that highlighted I think enough in some of the discussions I’ve had around category design. But

Andy Cunningham:
Everybody thinks it’s very sexy and, and a successful to build a category. But what they don’t realize is that building a category is different from starting a category, right? Creating a category. The creation of a category is, is the thing that is a, it’s, you know, it’s like putting a bullet to your head. If you’re going to create a category, you’re probably going to die, right? I cannot think of a single company that successfully created the category from the very beginning and still dominates it even five, 10, 20 years later.

John Rougeux:
So, so Salesforce with cloud based software, they, they didn’t, they weren’t the first company to build a cloud based software.

Andy Cunningham:
Not in fact, I worked with Hewlett Packard long before Salesforce ever showed his face on the, on the market and they had a cloud based. So I mean, cloud stuff has been around for a long time. What they did is they popularized it and they made it cool and they gate and they had a wonderful logo that said no software and they made everybody believe that, that they were the category creators, but they were not, they were the cat. They built the category. They, they built their success on the shoulders of people who had failed before them. And that’s how you do it. That’s how you build the category today. You find a great idea that’s out there and then you put your, your stuff on top of those shoulders and improve the heck out of it. And that’s how you build one. You learned from the people who made the mistakes before you.

John Rougeux:
Yeah. So is that how you described the difference between category design and craft category creation then? [inaudible]

Andy Cunningham:
I would say that actually do category design and category creation are probably the same sort of idea that they, the thing that I would say is different is building a category. Like you can see that you invented the first electric car, right? If you’re still alive today. But that doesn’t mean that you built that category. It means you invented a new idea that that was the very, very beginnings of a, of a category that took a hundred years to actually come to fruition. You know, the product market fit wasn’t quite there a hundred years ago for electric cars. It is today.

John Rougeux:
Yeah. Let’s bring we talked about positioning at the beginning of our conversation. Let’s bring that back into the mix because I, you know, they’re very key positioning and category creation or category design, whatever you want to call it are related, but they’re not exactly the same thing. So w what can you teach us about how we should understand those terms and how they relate to each other?

Andy Cunningham:
Sure. So I, I think you need, you need to understand the answer to what both of those are for yourself as a company. So you need to know what category you fit in and then you need to know how you, what is your position within that category. So to me, understanding your category is a very, is a very strategic question. And that is where you have to decide are you going to join an existing category? Are you going to attempt the death knell of creating a category? Or I even create what we call sub categories. That’s actually a place where you can maybe make some, make some headway if you’re really feeling adventurous. And one of the, one of my favorite examples of that is the Dodge minivan. So Dodge, you know, an automotive company had a problem. They had too many chassies of a certain size and they basically were suffering for an inventory blood.

Andy Cunningham:
Somebody inside the company, I don’t know who it was, said, Hey, what if we don’t put the sedan on top of that chest and put something else on top of it? Maybe we can sell it then. And they put these scrambled together, a very raw, what is today the minivan. And they put that on top of the chassis and it got, got a little bit of traction. People really liked it. Then they started to improve it and make it better. And voila, a few years later, the minivan was born. But that, that’s a subcategory. It was brilliant. It was born out of a problem like many successful things are. And the fact of the matter is it still took years to build it even, and they couldn’t have done it without, without the, the, the funding behind, you know, the funding that Dodge had with other successful vehicles.

John Rougeux:
Right. And they could, they kind of were forced into that situation. For better or worse with that glut of inventory that you mentioned? Yeah. how do you see subcategories playing out in say software?

Andy Cunningham:
I, well, I think, I think if you can find something that where there’s a big improvement that is required in an existing situation. You know, I think you can build, you can build a subcategory. It’s, it’s not, it’s still, it’s not an easy thing to do, but I think it is, it is possible to do it. So if you take, say Oh, you know, like the whole Adobe suite of, of marketing products, everybody every loves Adobe and we all love their product. But you know, they started with, they started with the creative product, you know, I forgot the name of it, but, but they were actually able to establish a market with that. And then what they did is they actually started buying companies and they started doing their own development and creating sub pieces of that overall thing until one day they said, wait a minute, what we really have up here is what we’re going to call the creative cloud. So they actually created all these, I would say subcategories of the creative club, but they didn’t name the creative cloud until much later and that’s when they realized, Oh, we have a big category. It’s not even a category. It’s like product line and all of these little sub categories that we were trying to build actually fit underneath this creative cloud idea. So

John Rougeux:
Would it be safe to say then that if you’ve built something, whether it’s an ecosystem of products or maybe just to a point tool and there’s not really a great framework to describe what that thing is in the market, is that where designing a subcategory comes into play?

Andy Cunningham:
Yeah, I think that’s a, that’s actually a great way to look at it is, is sometimes you’ve build something that that adds a twist or does something slightly different. Any, and that’s why the question of what is the category you’re in a really important one because you need to understand if you are joining, because the marketing is different. If you’re joining an existing category, the marketing is different than if you’re creating a subcategory. So marketing the Dodge minivan was a very different task than marketing another sedan that looked just like the other sedan before it. That’s much more of a commodity marketing situation. So yeah, it’s an important question to answer. And then positioning is, okay, now that you understand what category you’re in, where w what’s your spot on, you know, what’s, where’s your place in the sun in that, in that category. How do you, what’s your differentiator? What is your role? What is your relevance? That’s, that’s to me what the positioning is. It’s the dot on the map inside that category.

John Rougeux:
So they’re not, it’s not an either or. It’s you’ve got to make these two different decisions. One is what category you’re going to compete in. Is that finding a niche within an existing category or does it mean creating and designing a new category or subcategory? And then given that, what’s your, what’s the position within the category, right?

Andy Cunningham:
No, what category you’re in. Like what are you, are you, are you cloud based software or are you an electric vehicle? Are you you know, are you a video conferencing system? Yeah.

John Rougeux:
Yeah. Tell me, tell me more about why, why that’s so important for people to understand in the, in the buying process.

Andy Cunningham:
Because because of how the mind works, the, the brain has a very hard time coming up, understanding brand new things that don’t fit into all the spaces. Your, your brain is kind of mapped out to understand things when you see them. When you see something you’ve never seen before, your brain doesn’t know where to put it or what to do with it. So a lot of times what people do, most people when that, when they’re confronted with that as they, they push it out and they ignore it. And that’s the last thing you want as a marketers cause people to be boring, your product or your service. So if you can put it into a place in the mind that, that people understand, then then you, you’ve created an affinity for it from the get go. And that’s much better than creating repulsion from the beginning. So you want it, you want to try to create an infinity and you do that by, by being something that they already recognize. And that is why analogies work so well in marketing. This is the Uber of that. This is the Apple of that. It’s because your mind works that way.

John Rougeux:
So it’s in such a complex world. In order to help us kind of sort through that and rate and make our way through it, we have to use categories as kind of rules of thumb or for what things.

Andy Cunningham:
John, I froze up on me. Am I still with you?

John Rougeux:
Yeah. Did you? Yeah, I’m still here. Can you hear me, John? Hey, I’m S can you hear me now? Oh, you froze. You froze up. Mine are you back? Okay. Yeah, I’m back. Okay. Yeah. okay, cool. Okay. I think I got your question cause it’s just recording locally, but I’ll, I’ll start my comment back over. I was saying just because our world is so complex and there’s so many things our brain has to contend with, we use categories as these rules of thumb for [inaudible] grouping things together and knowing what to expect. And like you said, if you don’t give buyers context for what that is, they’re just confused. And then like the worst thing that can happen is they’ll, they’ll push you away.

Andy Cunningham:
What about, so first you gotta, you gotta create affiliation and then once you [inaudible]

Speaker 3:
Create affiliation, then you can create differentiation. If you create differentiation before affiliation,

Andy Cunningham:
You’re kind of messed up.

John Rougeux:
Sure. It’s like D different from what if, if you’re just saying you’re different but you don’t give context for what you’re differentiating yourselves from or how you’re you know, better, you cheaper, faster, whatever those characteristics are, then none of that really makes any sense.

Andy Cunningham:
Right? Exactly. You, you, you, there has to be, there has to be context for people to understand why the, why your product is better than the other ones out there. So if you’re, so if you look at Ilan Moskin the one there, he’s one of my favorite examples of using his character and his vision as a differentiator. Right? So people, there’ve been many electric car companies and there will be many more electric car companies. He was definitely not the first, as we talked about a while ago. But people want to affiliate with him because he’s showing them a path to a better future, not only with the electric cars, but with space X and the boring company. And then neurological thing he’s got going. I mean, he’s, people want to attach themselves to a visionary like him. And so he uses that to market Tesla and, and that’s, that’s brilliant. And Steve did it too with Apple. He used his own personnel. Richard Branson uses it. If you have that kind of a personality and that asset going for you, you might as well, you know, use it to help help market your company.

John Rougeux:
Yeah. Well that’s probably a great segue into some of the principles in your book. You have identified these three different DNA types that companies can use to help better understand their own positioning and their own messaging. So can you walk us through what those are and then I know you’ve got some, you know, the, the six subtypes do with that. So yeah, I’d love to hear your take on that. And read the book. That’s right. It’s right here. So, so here’s

Andy Cunningham:
The thing is that companies are a lot like people. So if you sort of go into the whole marketing exercise and understanding that you’re going to be a much better marketer. And the reason they’re like people is because they serve people and they’re made up of people and they make products for people. So, so the first principle of all of this is that companies are a lot like people. So within that I, I looked at a couple a hundred companies that I’d worked with in the past and I tried to categorize them into to see if there were patterns that were forming. And I spent quite a bit of time doing this and I, and I, and I wound up with three piles on my desk, three piles of companies. And there was the companies that were very customer focused, a pile of companies that were very product focused in a pile of companies that were very concept focused.

Andy Cunningham:
And then I tried to find other things, other places to put them, and I couldn’t, I couldn’t find a company that went into a new pile. So once I looked at those piles, I examined what, what exactly is the same of all these companies and let’s say in the customer focus pile. Well they, they treat people differently. They hire people differently, they talk about different things in meetings. They structure themselves differently, they measure success differently, they do all these things differently. And then I looked at the things that they do and I tried to match it up with the product focused company and I realized, Oh, they structure themselves differently and hire different kinds of people and measure success differently. And the same is true with the concept company. So that was kind of the beginning of the idea that I have these three types of companies.

Andy Cunningham:
So then of course, because I’m a marketer, I had to give them nicknames. So I called the mothers for the customer focus companies, mechanics for the product focused companies and missionaries for the concept focus companies. But I took it one more step and I said, okay, let’s say you are a mother company. Okay. How, how could you position yourself once you understand what your DNA is? How can you position yourself with that knowledge? Well, I, and again I tried to find more than two, but I could only find two in each of these in each of these categories. So if you’re a mother focused company, you can only position yourself around customer experience or customer segmentation. Now there’s a million ways to position yourself within that, but you can only be around a segment like Nike does. Nike is a mother company that focuses on the segment of what they call the aspirational athletes, right?

Andy Cunningham:
Whereas Disney is a company that focuses on customer experience and they focus on the experience that that their customers have with all of their products, especially their theme parks. If you’re a product focused company or a mechanic, you focus on either features or value. Walmart is a very value oriented company. Oracle is a very feature. Oracle and Microsoft are both very features oriented companies. And then the third kind, the concept companies or the missionaries as I like to call them, and I spent a lot of time working closely with Steve jobs. So I feel like I have a great affinity for these kinds of companies. They positioned themselves either around cultic personality, like Richard Branson or Elon Musk or [inaudible] themselves around the next big thing. They’re going to create the next big thing. And if you look at them very, very closely, you’ll notice that the next big thing that they come up with is never the first. But that next big thing has shown up. Even if you look at the iPod that that Apple created, not the first time there was ever an iPod, right? There were MP three players before that. Its way if someone like Steve of vision or like Steven can take all of the elements of, of something that is already out there and add to it, which is what he did with the Mackintosh and create something that feels new but really isn’t all that new and that’s, that’s just brilliant. Brilliant product market fit stuff I think

John Rougeux:
So yet, like that example of MP3 players and iPods is, is really interesting because I wonder what would be going on in the minds of someone who had, you know, demented, some of the predecessors to the IPI, these MP3 players. And I don’t know enough about what, what brands those were, what the product names, but everybody forgot them. So is it, is it simply because those companies didn’t have the right way to position and kind of sell a vision for those products or is it something bigger than that?

Andy Cunningham:
Well, I think they didn’t understand how people were going to use them and that, and that is the, is the biggest difference. I actually worked with one of those companies before the iPod came out and I think the name of the company was sonnet or S or something like that. I didn’t even remember the name of the company cause they died shortly thereafter. But most of those companies thought that their vision for the product was not so much around music, but it was really more around MP. Three players moved into the music. But even before the MP, three players, they were talking about more like what we would call a podcast today. Right? But she hadn’t been invented at that point, but they, they saw them as a new way to have radio. Right? So they envisioned people using it as more like a radio when you’re at the gym, when you’re going for a walk and they didn’t understand, they didn’t understand the positioning.

Andy Cunningham:
Right? So Steve comes out, he says, here’s a thousand songs in your pocket. Like wow, that’s what I want. I want, I want music. I don’t want radio cause I already have radio and I want it in my pocket. And it’s like the positioning was so brilliant, you know, it’s just a thousand songs in your pocket. It’s not all of this technology mumbo jumbo and all of this. So that’s why, that’s why his made it. But then he also reinvented the music industry in order to go with them. So there was, there was other things that had to happen to make that a success, but, but that was just brilliant positioning.

John Rougeux:
So there was this category design aspect where he wasn’t just building the product, he was building an ecosystem of things around the product to make [inaudible]

Andy Cunningham:
Good point. You got to have the ecosystems, like he needed the, the music industry as well as his technology, right. Elon Musk needs the whole supply chain, right. In addition to what he’s building, you can’t do it alone. So but the iPod entered an existing category that at the time was called MP3 players, but Steve didn’t call it an MP three player. Right. That’s not what he called it. He said, I’m just going to call it an iPod. Right. So everybody thinks he created that category, but he didn’t create that category.

John Rougeux:
Yeah. And those, those names became kind of like household names for that product. Like my kids, they’ve got [inaudible] like these, yeah. Amazon Kindles like the kids’ version. But before that they had my old iPads. So that’s what we called it. And that’s what we still, they refer to their Kindles, iPads, even though it’s not what they are. Yeah. Yeah. So you’ve got these, there’s these three DNA types, missionaries mothers and mechanics. I want to ask you about how they relate to category in a moment, but can you just give me a few more examples of companies within each of those and especially since this is a B2B show, if you can think of any BDB examples, that would be really cool to hear.

Andy Cunningham:
Sure. Well, I like I, I’ll start with the mechanics. So Oracle and Microsoft are the two best examples that I can come up with. And B2B companies, well Microsoft is also B to C, but they’re largely B to B and they are, they are so much product oriented companies. And by the way, when bill Gates started that company, he started as a product company, right? He started as a [inaudible], he bought stuff. He did most most product focus companies, they have one product and then they buy everything else. And then both of those companies are, are big in the M and a in the MNA space. So those are, those are great companies like that. In the mother space that’s a little bit more challenging. But here’s what’s starting to happen. Amazon, Amazon is moving itself from a product company actually firstly started as a missionary company.

Andy Cunningham:
Then they moved into product. This is sort of a normal path of operation and now what they’re doing is moving into being a mother company. And they have, they started this process back several years ago when they bought Zappos and they didn’t buy Zappos because Jeff bayzos couldn’t figure out how to sell shoes online. They bought Zappos because they were trying to infiltrate the company with that customer centricity, that customer focus that Zappos is so famous for. And Tony Shay with his book delivering happiness is so famous for. So that was the first step that they took in actually becoming a mother company. And they’ve done many steps since then. And the latest thing they’ve done, this is probably two years old now, is they actually published a new mission statement and they made a big deal about this new mission statement and their new mission statement is to be Earth’s most customer centric company. And so you can see that they’ve made this purposeful steering from where they were to a mother company. And that includes not only there’d be a C stuff, but also there’ll be to be stuff with AWS and all of that.

John Rougeux:
Right? Yeah. If that statement’s not a mother oriented company, then I don’t know what would be

Andy Cunningham:
Exactly, exactly. They made a big deal about making sure everybody knew that that was their new mission statement. It’s all, it’s on their website. It’s very prominently placed. Most companies don’t put their mission statement out there like Amazon has done recently with that. And in the missionary department, that’s a, that’s a, that’s sales force as a missionary. Okay. Jeff, Marc Benioff, total missionary, total B2B company took something that was a great that was struggling already, this sort of cloud software saying and then, and the customer relationship management stuff and he blew it up into this giant thing and, and became a missionary around around how can you build your sales force to be more successful. And you know, I mean, I don’t even know what it’d be to be company today that doesn’t use Salesforce software. So sure they were successful. Yeah. So those are three B2B situations in those in those categories.

Andy Cunningham:
And one of the thing about these, these categories, remember I said companies are a lot like people, well just like people, when you know what you’re made of inside yourself, you can make something of it, right? We always tell our kids, find what you’re passionate about. Find what you’re good at and then you know, double down on it. Don’t find something that you aren’t good at and try to double down on that cause that will never be up authentic in the market. The same is true with companies. Find out what you are really good at and who you really are. Are you customer focused on your product focus? Where are you concept focused? And then double down on that. And when you do that, your marketing is much more authentic. It feels like it rings true. Like who would believe that Comcast is a mother company? I mean, who would, who believes their ad campaign out there about all these great stories they have about customers who are having a great time with Comcast. No one believes it because it isn’t who they are.

John Rougeux:
Right, right. Yeah. Not with a, a negative, a NPS score. Okay. So the DNA, it’s really something that you are uncovering, not so much choosing and then pursuing as a direction

Andy Cunningham:
That that’s right. And, and if you’re a startup company, it’s probably going to be the DNA that you brought to the table as the founder. That’s probably how it starts. And usually that starts with a missionary kind of idea. Not always. Sometimes somebody says, you know, boy, I have this great new product feature and I’m gonna build the heck out of a company around it. And that then, and then that DNA kind of infiltrates the whole company. So usually it starts with the founder. But as companies grow and mature, they, they can make purposeful shifts like Amazon is doing or it’s happening to Apple in the market right now. Apple is not purposefully making that shift. But when Steve jobs died, they lost their missionary, right. And unfortunately they were not able to find another missionary. And Tim cook, who I believe is probably the world’s greatest steward of assets that he was left is, has spent several years trying to replace the missionary and unable to do so.

Andy Cunningham:
Meanwhile, the markets pushing them into being a product focused company. And unfortunately in my opinion, even though they’re super high valued and I think they’ve done a fabulous job, they a little behind the eight ball and recognizing that that’s what they are today. They’re a product company today. They are, in fact, I call them any essential luxury brand. You know, they’re like Louisville on, except you except you need your Louis Vuitton, right? You need your, you need your, if your, if you live your life on the, on the, on iOS, you, you will pay the extra money for it. And because you think it’s a luxury but you need it. So when essential luxury is a really unusual position that they have in the marketplace today, but they gotta make sure their products are working really well.

John Rougeux:
Right. And a lot of the products they’ve announced recently, I don’t know about you, but I wouldn’t describe them as next big things like the Apple credit card, you know, the next generation of, of AirPods, like they’re interesting products are good products, but they’re not like game changing categories we’ve never heard of before.

Andy Cunningham:
You haven’t had a next big thing since, since Steve died since a long, long time. And they’re not, they’re not going to, you know, they’re there. They’re not going to what they’re, what they’re going to do is they’re going to continue to evolve those products. They’re going to become more of a services company. They’re going to try to make themselves essential to your lifestyle. And that’s, but my, my big beef on Apple these days actually is that back in the day they developed, they, the reason that the McIntosh became successful after Steve went back to Apple is because he recognized there was a tribe of people who were really, who were, who were so dependent and in love and passionate about the Macintosh. And he tapped into that tribe and then grew that tribe. And it turns out that tribe were creative people. They were the people who think different, right?

Andy Cunningham:
That was his whole ad campaign. Well, he, when he discovered that, which he didn’t know when example, the first time when he discovered that and double down on it, he was then able to grow the tribe today, you know, what is it nine years after he died? Nope. They don’t, nobody knows who the Apple tribe is anymore. No one has, I, you know, what is the Apple user? It’s like we don’t have a tribe anymore and, and we need, they need to define who their tribe is and, and start communicating with their tribe. Just like Steve did back when he came in and did the think different campaign.

John Rougeux:
Yeah. It sounds like a real challenge when you’re, you know, one of the most valuable companies on earth and your tribe is, you know, a few billion people. Large [inaudible].

Andy Cunningham:
Exactly. It’s a big challenge, but I think a, I think they’re up to it, but I think they have to recognize that it is a challenge.

John Rougeux:
Sure, sure. So back to your, your DNA types. One of the, the points that I remember highlighting when I read the book was this idea, this misperception almost stat. In order to be a category Cray shirt, sorry, a category creator, you have to be a missionary. But I don’t think you believe that’s the case.

Andy Cunningham:
Correct? I, I don’t, I think you can, you can build a category. Again, I prefer to use the word build rather than create, because I think the creators die. I think the builders thrive, but I think we’ll build a category a as a mother or mechanical or missionary. I, I think I may have many of them have actually, if you look at Nordstrom is a great I think a great example. I don’t know people outside of the West coast know what Nordstrom is, but it’s a retail store out here for clothing and shoes and men’s and women’s and children’s and it, it is, it is known for its incredible customer service, much like Zappos, they’re known for their customer service in that regard. And they, they basically created that. That’s what they created. That was their sub category, but super high end service for retail. No one else had done that before Nordstrom did. So they created a sub category within the retail store, within the department store category and it really took off and they still own that position today.

John Rougeux:
Sure. So if you have this idea that you’re, you want to build a category, you want to build a subcategory and do it, at least some of the startup founders that I’ve talked to when I’ve actually shared this framework with a few of them. And a lot of times I hear, well we want to be missionaries. And it’s like, yeah, it’s, for some reason I think that like comes across as more appealing. Like it sounds more adventurous or interesting. And so, but you’re saying like you can be a mother, you can be a mechanic, you can be product focused, you can be customer experience focused or focused on a market niche and design a new category. It’s just with a different lens than you might if you’re doing the next big thing.

Andy Cunningham:
Yeah, I mean, yeah, I think everybody who doesn’t want to be like Steve jobs or Howard Schultz or Elon Musk or Richard Branson, of course. I mean, when you look up to these people, they’re the heroes of our time, right? So of course we all want to be like them, but when you really, it just like, I, I, you can’t, your viewers can’t see me, but I’m, I’m five foot three and I’m, I’m stocky and I do not at all look like a ballerina. So when I was a child, I took a lot of ballet and I wanted to be a ballerina. But if I look at my DNA, I say to myself at some point when I was like 16, this ain’t going to happen. You’re not going to be a maleria. So it’s like you have to look at who you actually are in order to make something of it. And so even though everybody wants to be a missionary, you know, you can’t pretend you’re a missionary if you’re not. And, and just like, I couldn’t pretend I was a ballerina if I really wasn’t. So it’s really important to understand who you are. And there’s a lot of companies in all three of those categories that have built, they’re built ginormous industries, right? But not around the idea of being a missionary. So if you happen to be Steve jobs or Ilan boss cake, more power to you, you probably will do lots of great things.

John Rougeux:
Yeah. Yeah. So would you consider like Larry Ellison or bill Gates, even though they have high profiles, would you consider them missionaries?

Andy Cunningham:
No, I would not. And I know both of them and they’re brilliant people. Brilliant. but not, but not missionaries.

John Rougeux:
Okay. Cool. So we’ve talked about category, we’ve talked about positioning. I want to talk a little bit about braining because I remember you have a little bit of a, a bone to pick and I have the same kind of bone to pick about doing braining in isolation, especially before positioning. So tell me more about that. Why it’s so important to do branding at the right time with the right context.

Andy Cunningham:
Yeah, it comes from a philosophy that I have again, about companies being like people, we all do better in life. If we think about something before we act, right? We, the rational side of us is a smarter side and we do, we do better things if we think about something before we act on it and then we attach the emotion later. So the same is true with companies. If I look at positioning as the rational side of the company, and I look at branding is the emotional side. And you got to have both of them because just like in a human, we need a rational side and we need an emotional side because we need a heart and we need a head, right? But when you’re a company, it’s so much easier to lead with the, with the emotion, with the heart, because it’s sexy, it’s colorful.

Andy Cunningham:
It’s a great thing for a new CMO to do when they come into a company because it creates a lot of, you know, a lot of action and colors and you know, storyboards and all this sexy stuff. It looks like stuff is happening, right? But what happens is you spend a bunch of money on that and it’s all around the emotional side of it. It’s all about the tagline and the colors and the logo and the, you know, the, those pushy stuff, as I like to call it, the hard stuff. And then it goes out there and then you realize like sometimes as little as a week later, Holy shit, that’s not, that’s not at all who we are. Right. That’s, that’s my dream of the sexy Andy. Not my dream of the real auntie, right? So if you actually come out there and figure out who you are first and position yourself rationally, then do the emotional stuff, then you’re basing all of that emotions on something that’s actually real and it works so much better.

Andy Cunningham:
And I can’t. There’s millions of companies that have gone through this exercise only to destroy it. Later. There was a company called flex. Do you know Flextronics? It used to be called Flextronics. Now it’s called flex. It’s a B2B men contract manufacturing company. Gigantic, gigantic [inaudible] Valley. They went through them. They hired a new CFO about four or five years ago. He came in, he rebranded the entire company. He changed the name. He went from Flextronics to flex. They changed the entire advertising and positioning and tagline and everything and came up with a new tagline. It was called from sketch to scale. It was super creative. I know the creative team who did it, it was 1185 design. They were, they were brilliant. They launched this campaign and literally a year later they killed everything because none of it, none of it was reflective of who the company actually was.

Andy Cunningham:
And here’s how they discovered that, right? They, they looked at that, they had this notion of sketch to scale, you know, so we, we will help you at the very small end of what it is you’re building. If it’s a tiny little software app all the way up to, if you’re building another Apple computer will do all of it. They looked at their revenue and where it was coming from, and zero was coming from the sketch part of it. So the whole promise of from sketch to scale was false because they didn’t do any of the sketch stuff. So they, so they, so they, they basically fired the CEO. They fired the COO and they brought in a new, a new team and they killed all of that. And it was, it, I don’t know, a couple million dollars at least in, in creative work that was done on that, on that product. And it was brilliant creative work. That’s the thing about it was brilliant. It just didn’t match with the company. It wasn’t authentic who the company was.

John Rougeux:
Sure. And that that work on the creative or the cost of the creative work probably pales in comparison to the opportunity costs of confusing the market and making people not sure of what you’re really about.

Andy Cunningham:
Exactly. And so it was, I mean I, I knew the people who did it. They’re brilliant people. That was super creative work. If the company could of changed itself to become that, that would have been great. But the people that were doing this work didn’t, didn’t have the power to actually change the company from the ground up. They were just changing the marketing. Sure. They were putting the ballerina costume on top of the five foot three person.

John Rougeux:
Yeah. Yeah. Well yeah, that’s right. Like if like if you think about it in terms of maybe like a job interview, you know, you’ll have to pick out of course something to wear to your job interview. But depending on what kind of position you’re applying for and what kind of impression you want to create, you might pick something that looks really interesting and is fun and creative, but it might create the totally wrong impression or it might not reflect the kind of personality that you’re comfortable with. And then you’re gonna feel awkward wearing these clothes and it’s going to kind of come across. People will see right through it. And it sounds like that’s exactly what can happen to a company when they put on this new kind of persona or visual identity or and about how they want to look. But if it’s not something they’re trying to achieve or reflective of who they already are, then it’s not gonna last.

Andy Cunningham:
That’s it. That’s exactly right. So, so you are so much better off if you just figure out who you are first and then create a position around that and then do all that sexy, fun branding stuff that aligns with that position. You’re going to be way better off and you’ll be ahead of the game instead of instead of behind the eight ball, which is what happens to all of these companies. But that said, positioning is a, is a high, it’s a rigorous hardcore examination of who you are. It ain’t easy. Right? And it’s not, it’s not that much fun. The fun part is all the sexy stuff. So, so people, you know, when you’re a new CMO and you’re coming into a company, you want people to notice you, you want to make a difference, you want to see, you want to see visible change.

Andy Cunningham:
None of that happens with positioning because it’s, it’s like, Oh, this is my DNA and this is my category. And all these questions that are so hard to answer. And nobody, nobody who goes home at the end of the day and goes, Oh my gosh, I’m in the X category. You know, they just, you know, they, they don’t talk about it at home with their spouse and their family. They talk about the new tagline they came up with or the new ad campaign. So it’s, you know, emotional things are so much more attractive to people, but if they’re not based in reality, they there, they, they’re ether, they fizzle into the ether very easily.

John Rougeux:
So what do you tell a company who is, you can see from the outside that they haven’t thought through their positioning, maybe it’s not even on their radar for whatever reason, and they’re getting hung up on this, the branding side of things or the outward facing things. What do you say to them to kind of change their way of thinking and really get them focused on doing the right things first?

Andy Cunningham:
Well, the, the, what happens to me and the way I get brought into companies is they’ve already hired those brands and companies and then it’s not, it’s not creating any traction. So, so I come in after they’ve already spent the several million dollars or however much money it costs and, and I, and I say, well, this is what happened to you, right? You, you got seduced by your own language. And that’s understandable. But now that we have to do is we have to look at who you actually are. And see what of that branding stuff that you’ve done. Can we actually, you know, can we use some of it or do we need to toss all of it if it’s not based in reality? So I don’t usually get a chance to see them before they’ve already made that mistake. So that’s one of the reasons I wrote the book is I really want people to think about this before they take action because it’s, it saves time and money and, and market leadership, right? It’s like you can’t go out there and pretend you’re something and try to build a leadership position on it. Then you have people discovered that it’s not true and then you have to fall that fall from grace and start all over again. Right,

John Rougeux:
Right. Well, what’s your advice for an earlier stage company who doesn’t have million suspend on branding, positioning, consulting, any of that? They’re just trying to get started and get the right foundation in place. How should they think through positioning? What’s like, should they try to still try to bring in someone from the outside because you have that unique more objective perspective? Should they try to do it themselves? What, what have you seen?

Andy Cunningham:
Well, I think for startup companies, it’s branding is, is less is less important, right? Because we really just have to identify who you are and why you matter. Right? That’s the most important thing for a startup company. And then later you can add the pretty stuff that goes with it. But but I would advise startup companies to, to either, if they, if they really don’t have any money to just read the book and, and follow the, follow the methodology because that will give you a lot of information. It helps to have an outside person who’s been through that a bunch like I have where I can actually help companies, you know, connect the dots. Because really what you’re doing with my methodologies, you’re creating a bunch of new dots, right? And then you have to, then you have to connect them into a, into a logical, logical conclusion.

Andy Cunningham:
But you don’t, it doesn’t cost much money to do that. Right? You just follow that methodology. But really if you can answer the question for yourself as a company, who are you and why do you matter? You’ve, you’ve got, you’ve got the answer, right. So whatever methodology you use to get through their, whether it’s my book or somebody else’s those are the two questions. Do you have to answer who are you as a company and why do you matter? And if you can answer those two questions, you understand what your position is and then you can do the fun taglines and color palettes and logos and all that cool stuff.

John Rougeux:
Yeah. Cause that’s going to reinforce who you are and why you matter through another means.

Andy Cunningham:
Like you want it, you know, you, any good designer will tell you we want the logo of the company should reflect the company or that’s kind of the, the, you know, the idea for form should follow function. That’s a, that’s a big design premise. But so many people don’t understand that they, they just, they’re so seduced by the, the fun and the glitz of, of creation of creativity. But positioning is not a creative act. Positioning is a rigorous thought process that involves research and, and understanding of what’s going on in the market. It’s, it’s, it’s not as exciting. It’s kind of boring. It’s hard work, you know, it’s like understanding what your personality is. Like are you an IMTJ if you, if you look at the Myers Briggs thing or an ENTP or whatever the heck it is, you might be like, examining that with yourself takes some hard work.

John Rougeux:
Yeah. You mentioned doing a lot of work to research the market. Do you and the work you’ve done, do you tend to do a lot of you know, first party research? Do you rely on other information you find you use like surveys, interviews, what’s, what’s your process look like?

Andy Cunningham:
We’ll use all of that. So, you know, we, what we’re trying to look at is the, is the, is the landscape that accompany is putting itself in. So that landscape has a number of things in it. Right? And those are the six lenses that I talk about. The landscape that you’re putting yourself in as a company. It includes, you know, the community that you’re serving, which includes your customers as well as their influencers. It includes the category that you’re in. It includes the context in which you are doing this. Like doing something today is very different from doing it 20 years ago. The competition is another critical piece of it. Your DNA, the coordinate DNA is another piece of it. And then the sixth, the sixth lens that we look at is, is how would you define a successful positioning statement? You know, we call that criteria.

Andy Cunningham:
So we want you to figure out what your criteria is for a great position statement before you actually write it so you don’t get seduced by some sexy tagline. So anyway, we look at the landscape that you’re launching into and we, we use that in our favorite right there. There are contextual waves that you can ride. So you want to figure out how to ride one. Like if you’re a software company today, you wouldn’t and you’re not in the cloud, you’re not going to get any traction with anyone, right? That’s the contextual way that we are in right now. It’s all about cloud delivery. So you have to be a cloud company. So it’s stuff like that, that, that we look at and help companies figure out how to position themselves within each of these lenses so that they can stand out, cause your brain notices what’s different within a context of, of a category. So,

John Rougeux:
So really thinking through just what’s, like you said, the context of the market that you’re trying to serve. How do you define the company internally? What’s it made of? And then how do you, how do those two relate to each other? That’s yeah, that all feeds into your positioning and all the work that extends F after that.

Andy Cunningham:
Yeah, exactly. So, you know, we, we’ve tried to figure out where are you the same? That’s the category. Where are you the same as everyone else? And once we understand where you’re the same, then how can you look up who stand out within that, that sea of sameness as people like to call it.

John Rougeux:
Sure. Sure. All right, Andy, we are almost out of time, but I want to ask you if you have any other advice you want to leave marketers or executives, anyone thinking about a messaging and positioning? Any other advice you want to leave with them today?

Andy Cunningham:
Sure. And just to two things. One is alignment is critical. So everyone in the company has to be aligned on what the messaging is because you don’t want one person saying one thing and another person saying something else, then another person saying something else. So alignment is critical. And then positioning is critical. What you need, you need to own a position because if you don’t own it, somebody else will. So the idea is create alignment among your executive team and on the messaging and then own, own a position. And with those two things, you can go a long, long way. You don’t need a lot of money.

John Rougeux:
All right? So create alignment, own a position. Good to get advice to end with. What’s the best way for one of our listeners to get in touch with you?

Andy Cunningham:
So we, we have a website, it’s, it’s called get to aha. We have two websites, Cunningham, collective.com and get to ohad.com. I have a book that I’d love for you to do for people on your listenership to to check out and buy it. Cause now I’m in the book selling business available. I, Amazon’s called get to aha. And that’s probably it. I’m on social media, I’m on LinkedIn. I’m also on Twitter. So I’m Andy Cunningham for@twitter.com and he kind of gave them four. All right. Four of us.

John Rougeux:
Okay, good deal. All right, well Andy, thank you so much for being with me today. I learned a ton from you. Really appreciate you being on the show.

Andy Cunningham:
Well thank you John. It was a real pleasure. Thank you. Take care. Thanks. Bye. Bye.