Competitive Positioning

The Importance of Competitive Positioning for Social Entrepreneurs

In today’s dynamic social enterprise landscape, competition is inevitable, even for those driven by a social mission. Social entrepreneurs often work in complex, ever-changing environments, and understanding the competitive landscape is crucial for success. Competitive positioning allows social enterprises to differentiate themselves, secure funding, and carve out a meaningful niche in the market.

Let’s break down why competitive positioning matters and how social entrepreneurs can leverage it to their advantage.

 Why Competitive Positioning Matters

1. Defining Your Identity  

   Positioning yourself in the market helps define the identity of your organization. The way you communicate where you fit in the ecosystem shapes how people perceive your enterprise. It sends a clear message about your mission, your values, and your unique contributions. Whether it’s for potential customers, investors, or partners, your positioning answers the all-important question: "Why you?" 

2. Attracting Support and Funding  

   Investors and funders care about competitive positioning. They want to know how your organization compares to existing players in the market. Your ability to articulate a clear and differentiated position increases your chances of attracting necessary resources. A strong competitive position signals that you've thought through the market landscape and understand where your enterprise fits.

3. Creating Market Differentiation  

   The most compelling reason for competitive positioning is differentiation. In a crowded market, standing out is not just about offering a unique product—it’s about identifying those key factors that make your offering different, better, or more relevant to your target audience. Competitive positioning helps you figure out what makes your product or service special and why customers or beneficiaries should choose you over others.

 How to Approach Competitive Positioning

To effectively position your enterprise, it’s important to answer a few fundamental questions about your market:

1. What market am I operating in?  

   The first step is understanding the broader market. Are you competing in a well-established market, or are you pioneering a new one? Knowing your market helps you map out where you stand in relation to others and determine which players might be competing for the same customers, resources, or impact.

2. What are the key overlaps between competitors?  

   Competitive positioning is a matter of identifying shared elements. You need to look at the three key dimensions:

   - Product: What are the core products or services that other organizations are offering?

   - Customer: Who is the target audience, and how does it overlap with other organizations serving the same population?

   - Geography: Are competitors serving the same geographical region or market, or are they located elsewhere?

   Understanding the overlaps in these dimensions helps you focus on where you need to differentiate, whether it’s in the product, the customer, or the geography.

3. What makes my organization different?  

   Once you understand your competitors, it’s time to ask what sets you apart. This could be your product's features, your organizational values, or the way you deliver services. Pinpoint the unique factors that will make your enterprise stand out in the eyes of your target audience.

 Competitive Positioning in Practice: Case Studies

Let’s take a look at two real-world examples of social enterprises that used competitive positioning to find their place in the market.

1. Blue Avocado: Reusable Shopping Bags with a Twist  

   Blue Avocado, a startup in Austin, Texas, identified a gap in the crowded market of reusable shopping bags. Their solution wasn’t just about creating a sustainable alternative to plastic; it was about creating a system of stylish, functional bags designed to work together. Through competitive analysis, Blue Avocado identified four key competitors and then assessed their products on five dimensions: system integration, style, functionality, portability, and price.

   The result? They realized they had a unique product that combined all the elements other bags lacked, but they also identified that their higher price could be a barrier. To justify this, they emphasized the company’s green mission, led by women entrepreneurs, and introduced a B-Corporation structure. This competitive analysis helped them define their niche in the market and communicate why their higher price was justified.

2. Jolkona: Redefining Online Giving  

   Another example is Jolkona, a new player in the crowded online giving space. Before launching, the founders asked: “What makes our platform different from others like Global Giving, Kiva, or Donors Choose?” Through competitive analysis, they discovered a gap in online giving platforms targeting young, socially conscious donors in the U.S. They then mapped out the competitive landscape, assessing existing platforms on dimensions such as ease of use, impact tracking, and donation transparency.

   Jolkona positioned itself as offering an easy, impactful donation experience, with a focus on tracking results and engaging younger, budget-conscious donors. They communicated these unique strengths in their marketing to differentiate themselves in an increasingly competitive online giving space.

 Key Steps for Social Entrepreneurs

1. Map the Market:  

   Start by identifying the general market you're operating in. Who are the major players in this market? What are the trends, the risks, and the opportunities?

2. Analyze Competitors:  

   Drill down into the direct competitors—those organizations offering similar products, targeting similar customers, or operating in the same geography. How do they compare in terms of product, customer base, and price? What are their strengths and weaknesses?

3. Differentiate:  

   Pinpoint the internal and external factors that set your enterprise apart. Internally, this could include product features or delivery methods; externally, it might involve reputation, partnerships, or a unique market position.

4. Position Based on Audience:  

   Different audiences (e.g., investors, customers, partners) care about different aspects of your positioning. Tailor your message to each group, highlighting the criteria that matter most to them.

5. Revisit Regularly:  

   Competitive positioning is not a one-time exercise. The landscape can shift rapidly, with new entrants, changing consumer behavior, or evolving regulations. Regularly revisiting your competitive analysis helps you stay ahead and adapt your strategy to maintain a strong position.

 Conclusion

Competitive positioning is a vital exercise for social entrepreneurs. It helps you understand where you fit in the market, what makes you unique, and how you can stand out in a crowded field. By conducting a thoughtful competitive analysis, you can make informed decisions that will guide your enterprise toward success, ensuring it is both impactful and sustainable. 

As you embark on your journey, remember: it’s not just about being different—it’s about being meaningfully different in ways that matter to your customers, partners, and investors.