See the show notes for this episode: S 01 | Ep 59 Positioning vs. Branding: Understanding the Key Differences for Business Success | Show notes.
0:00:01 - Alex Shevelenko
Welcome to Experience-Focused Leaders. I am thrilled to introduce you to Andy Cunningham. She’s the founder and president of Cunningham Collective, and the author of the bestseller Get to Aha!: Discover Your Positioning DNA and Dominate Your Competition, which, by the way, was recently featured in Times Square. Andy has played a key role in the launch of numerous technology categories and products, including a little-known product she worked on with Steve Jobs called the Apple Macintosh. Andy, welcome to the pod!
0:00:48 - Andy Cunningham
Thank you, great to be here!
0:00:55 - Alex Shevelenko
Well, Andy, positioning is a topic that often creates confusion. Some people confuse it with branding, while others mix it up with category creation. Can you tell us a little about how you define positioning, and what the biggest mistakes are that people make? I think I may have already touched on a few, but I’m sure you've seen many more.
0:01:14 - Andy Cunningham
Yes, thanks. Positioning is about finding a unique spot in the competitive landscape that only you can fill. That's the foundational concept. I like to quote Jack Trout and Al Ries, who wrote the first book on positioning, Positioning: The Battle for Your Mind. They describe positioning as owning real estate in the mind of the customer. It's about creating a space in their brain defined by your unique and compelling story, whatever that may be. You need to find that white space on the competitive landscape that only you can own, which gets harder each year with the thousands of new companies starting up all the time. And then, you have to articulate that in such a compelling way that it sticks in the mind of the customer or potential customer. That’s what positioning is.
0:02:11 - Alex Shevelenko
Where do most companies fall short? Is it in the articulation, or are they just trying to build "me-too" products, envying competitors and thinking they can do it better, faster, cheaper?
0:02:30 - Andy Cunningham
The biggest pitfall I see is that most products I work with are built by engineers, and engineers often have the mentality that if they build it, people will come. But that just isn't true anymore. When I started in this industry 35 years ago, there weren’t many technology products, so "build it and they will come" worked because there was less competition. But today, for instance, in the MarTech space where I work, there are over 8,000 MarTech products on the market. And that’s just one sector! Imagine how many HR, finance, or productivity tools are out there. You can no longer simply build it and expect people to come because everyone is doing the same thing.
So, you need to come up with something unique and compelling to attract customers. It used to be that new features could accomplish that, but today, with so many products, that’s not enough. Now, you have to think about your brand in addition to your product. Thirty years ago, it was all about the product, but now the tech world is adopting consumer marketing strategies that focus on building a brand.
You have to find a unique and compelling element of your brand, what we call an "ownable brand concept." This doesn’t have to be a product feature anymore; it can be something more abstract, like the relationship you have with your customers. Take Apple, for example. It’s not just a product brand; it’s an identity brand. You feel a connection to Apple. When Steve Jobs returned to Apple, he figured this out and it was brilliant. Apple has locked people into its ecosystem, not just with products but with an identity. People identify as “Apple people.” It’s one of the world’s best examples of branding. But even smaller companies can figure out what emotional connection they want to build with their customers.
0:05:11 - Alex Shevelenko
And capitalize on that. It's funny that you bring up Steve, and we were talking earlier about other folks who followed him in the later days, like Hiroki Asai. But, you know, my take on having watched the launch of the Macintosh and the way the positioning speeches were structured, they were like World War II-level campaigns. They really painted the enemy as the conventional IBM way of doing things. It felt like there was already this identity that we were going to be either the pirates, the rebels, or just the non-conventional folks. So, this was earlier, right? This was not back when Apple was as well-known as it is now. This was still an upstart.
So, what was it about Steve? What did you teach him, like, what were the Regis McKenna best practices that you brought? Because I’ve heard that at the beginning, he wasn’t nearly as good at some of these communications, right? Could you guide us through what it was like before and after Steve Jobs – like the techie, unpolished version, and then later? For me, I already saw some of these polished presentations, like the bow-tie era. It sounds like you already had an impact there in terms of storytelling and framing. So, please guide us through that.
0:06:51 - Andy Cunningham
Sure, let me just correct one thing. I didn’t do these things for Steve. Steve had a vision of what he wanted to do, and those of us around him helped him achieve that. We didn’t give him the vision; he already had it. I want to be very clear about that. Secondly, Regis McKenna, the guy I worked for at the time, was kind of a mentor to Steve for many years. There was a special relationship between Regis and Steve, which allowed me to have a special relationship with Steve that other people in the outside world didn’t have.
That said, what Steve was really into, as you know, was the rebellious attitude – the pirate flag on top of the building, the anti-IBM stance, all of that. He thought the way to build this brand was to create a rebel vision of a computer, a product people would want to use because it wasn’t the status quo. But what we found when we launched the product was, guess what? No one was buying it because people wanted to buy the status quo.
The Macintosh didn’t succeed until Steve came back to Apple eight years after he was fired, when he developed the idea of his "tribe." I also want to mention that before we launched the Macintosh, we did a focus group with Mike Murray, who was heading up marketing at the time. We gathered a bunch of people who, at the time, were the technology decision-makers inside companies. They weren't necessarily called CTOs or CIOs back then, but they were leading the charge in buying technology.
0:08:26 - Alex Shevelenko
Remember, this was 1983.
0:08:28 - Andy Cunningham
Yes, very early on. We brought a Macintosh to each focus group and let people play with it. They were so enthused, so excited—they loved the product. You could see it just oozing out of them. But the very last question we asked was, “Do you think your company would buy this for its employees?” And to a person, the answer was, “Absolutely not. We will never buy this product.” That was the "oh shit" moment before we launched the Macintosh. It actually forecasted what would happen: when we started to sell the product, it didn’t sell.
We were trying to position it as a business machine against IBM, but it wasn’t a business machine. It didn’t have many of the features a business machine needed, and none of these businesspeople were willing to go out on a limb and buy something as unconventional as a Macintosh. It just wasn’t going to happen. So, the product began to fail, and Steve was upset because this was his baby. He had a vision that it would succeed, and that frustration led to his fight in the boardroom, which ultimately led to him being fired.
After Steve was fired, I actually thought Apple would kill the Macintosh, but they didn’t, likely because of a guy named Jean-Louis Gassée, who was an important figure in the early days of Apple and the Macintosh. But anyway, the product languished for eight years until Steve came back. He realized that the people buying the Macintosh weren’t businesspeople; they were creatives—what we now call the "creator community." These people would carry the big, bulky Macintosh under their arms, often with a coat over it, so their IT manager wouldn’t see what they were sneaking into the back rooms of their creative departments.
0:10:25 - Alex Shevelenko
This was the original BYOD. It was the BYOD, exactly.
0:10:31 - Andy Cunningham
But it wasn't sanctioned, right? People were bringing it into the company and becoming super attracted to it, and Steve was watching this the whole time he was gone. He was watching, watching, watching what was going on with Macintosh. So when he came back to Apple, he realized there’s a tribe here, and it isn’t the business people I thought it was—it’s the creatives. Oh my God, what a brilliant insight, right? So then he started to create a marketing campaign for the creatives, and that’s when that whole brilliant campaign started. You know, it was the Einstein...
0:11:02 - Alex Shevelenko
"Here’s to the crazy ones..."
0:11:04 - Andy Cunningham
Yes! The Leonardo da Vinci's, the Albert Einstein's, blah, blah, blah. So it was...
0:11:11 - Alex Shevelenko
It was quite a learning exercise for him, but when he came back and clarified in his own mind who the customer was, he was able to capture that tribe and then expand it beyond what it was. So, if I’m reading this between the lines, it almost feels like the original office market that could afford the very first Macintosh wasn’t that rebel market, even though you were going for that, right? It was too early, and they were too corporate, too weaned on the IBM way of doing things.
0:11:47 - Andy Cunningham
Exactly. You remember the phrase, "You never get fired for buying IBM"? That goes back 80 years, and it was very true in the early '80s.
0:11:55 - Alex Shevelenko:
Got it. And so, later, when the situation changed, some similarities in the message emerged—maybe not as extreme, less about the rebels and more about the creators?
0:12:25 - Andy Cunningham:
Yeah, right, and that resonated. It almost sounds like it went back to the original premise, but it was just that the market was more mature. Well, it was a different audience, though—a different person. The product was also slightly different, but the audience was different. Steve originally thought he could get—just for lack of a better word—the "guys in suits" to switch over from their IBM PCs to Macs. But those weren’t the people. It was the long-haired, tattooed, pierced group sitting in the graphic design departments of these big companies who saw the benefit, and that’s what started it all. He built a tribe out of those people, because they were creative. They looked different, they sounded different, they acted different, and they thought differently. And that’s where the "Think Different" campaign came from.
0:13:08 - Alex Shevelenko
This is amazing because one of the problems when studying history is that you don’t know which lessons to take—what worked, why it worked, and why certain things didn’t. I have to admit, I loved some of the early launches around the first act. Everyone wanted to win a bunch of awards and put some careers on track. But it’s interesting why it didn’t work. It was basically misaligned. The positioning was wrong—the wrong person in the organization. It was a little too early, probably, for the creatives to buy their own things as well, so it was a little too early to market.
0:13:58 - Andy Cunningham
It was a positioning failure, that’s what it was. And so we all learned from that. Steve learned from it, Regis learned from it, I learned from it. We all thought that by building something really beautiful, elegant, and easy to use, and that you almost had a relationship with, it would be a no-brainer—everybody would buy it.
0:14:15 - Alex Shevelenko
But that didn’t happen. It’s interesting, especially in the B2B world today versus back then. You brought up the noise around all the tools out there, right? We had Scott Brinker on the podcast, who created that chart in MarTech that intimidated everybody. I love that chart, I love it. I think it’s only got half of the tools on there, by the way.
And it’s even more complicated now because we play in multiple categories. So I don’t think that chart works as well anymore because there’s a lot of blurring. But let’s talk about this B2B functional buyer. Historically, that’s been the case, but now there’s a different sort of need. Maybe we call it “consumerization.” You brought up the idea of bringing consumer techniques into B2B. So what’s changing in the B2B world? Are people developing more intimate relationships with enterprise software, or is it still the traditional buyer journey with committees, lots of decisions, and so on? How do you think about this?
0:15:41 - Andy Cunningham
I do think there are still challenges. Anytime you’re buying something for a large enterprise, the procurement process is huge, right? It’s filled with red tape, bureaucracy, and all that stuff, so that still exists. However, there are so many more choices now for companies to buy software, and so many opportunities for them to pilot new software that might be better but is super cheap because it’s a pilot. There are just more options. I think the more risk-tolerant companies—those that can absorb risk better—are more open to using brand-new products because they’re cheaper, essentially. That didn’t exist back then. It was IBM, IBM, IBM, oh, and IBM—that’s what everybody was buying. It’s different today because there are more options.
0:16:36 - Alex Shevelenko
When there are more options, price is one dimension, but that’s probably more important for some businesses than others. However, returning to feelings and experiences: We’re selling to mid-market and enterprise clients. For example, wearing my RELAYTO hat, we’ve been deeply inspired by Apple. We have advisors like Hiroki Asai, who also worked for Steve Jobs. We ask ourselves: How can we incorporate the human element to connect with the emotional needs of individuals inside mid-sized or large organizations and make them feel proud of their work?
Or, they might see themselves as good listeners, but in their work, they might be producing content that is monologue-like, without feedback or interaction. We aim to connect with their identity and aspirations. If they’re a result-driven designer, for example, they might care about the results of their work. I believe this is a fundamental human need—not just to express oneself but also to see the impact of that expression. Historically, many professions haven’t been able to achieve this, so you can tap into these needs that are less about cost and more about feeling successful as a professional.
I’m curious: What do you see succeeding in breaking through the wall of features and functions, and messy product lists of competitors that all look and sound the same, to reach that human level of positioning?
0:18:35 - Andy Cunningham
To me, that’s a brand issue. It involves someone inside the company who is very sensitive to brand and thinks about how to stand out. Apple was probably the first company to understand that you could create an emotional attachment to a product—whether it was a computer or another device. That was a huge breakthrough in marketing.
Since then, some companies—though not many—have realized that creating an emotional connection with your product is valuable. What you’re talking about is tapping into that human need to belong, to contribute, to make a difference, and to inspire.
However, very few companies focus on this because the tech world has become data-driven. Many companies have decided that emotional aspects are too difficult to manage, so they rely solely on data. If the data says customers prefer red, they go with red; if it says blue, they choose blue. Few companies think deeply about emotion and how to build a real connection with people.
Typically, the only people in companies addressing this are the CEO, CMO, or CHRO (Human Resources). The procurement department usually doesn’t care about these aspects; they focus on price and features. In large enterprises, procurement makes the decisions and is primarily concerned with cost and functionality. If you can overcome procurement with a value proposition that emphasizes the softer side of what a product can do, it can be challenging but possible. I’m trying to do this with a company I’m working with today, aiming to demonstrate the product's impact beyond just data.
0:20:53 - Alex Shevelenko
Well, it's tough because you're up against data. In the B2B world, for example, someone might say, "Blue means it's trustworthy or safe." So, then every company uses blue. That was IBM's color, right? So, you end up with this conventionality, where everyone follows the same pattern. It's all about relationships, and they think, "We’ll just put out some salespeople, and none of that soft stuff matters."
In your book, you actually cover this really well. You wrote, “Positioning works in concert with its more emotive sibling, branding, which offers an emotional expression of a unique role and relevance through logos, look and feel, color palette, use of language, tone of voice, customer experience, and design.”
Design might be something tech or product-focused CEOs care about, especially the newer generation, but some of the other elements don't seem as valued. It feels like they don’t matter as much. They focus on reducing friction and removing noise, which is already a good step, but the softer elements—like the ones we just talked about—often get overlooked.
0:22:29 - Andy Cunningham
Yeah, well, if you think about the functions in a company, you've got a couple of what I would call hard functions. Finance is a hard function, and even product development, to some degree, is a hard function. But things like HR, marketing, strategic planning, and customer experience are all soft functions. There’s no hard answer for any of those. And, by the way, there are more soft issues in a company than there are hard ones.
I'm a believer in addressing these soft issues, like strategic planning, which isn’t a hard science. It involves gut feeling, vision, and some market research, sure, but there’s no mathematical equation that tells you how to strategically plan the future of your company.
0:23:24 - Alex Shevelenko:
By the way, McKinsey consultants are probably crying right now, thinking, "Oh my God, I won’t be able to charge millions anymore."
0:23:32 - Andy Cunningham:
I say this as a former consultant—I get it. But McKinsey consultants can still be very helpful, especially by considering the human element in strategic planning. After all, we’re dealing with human beings, and as you pointed out, they have needs like contribution, feeling inspired, and making a difference. These are soft elements that can’t be addressed with just hard features.
When you're building a brand, the emotional side I mentioned is half the equation. You need to appeal to the human side of the person using your product. It has to look good, feel good, give them a sense of identity, and make them feel like they can contribute. These things are difficult to solve from a branding perspective with just data. You need to approach it from a human perspective. AI might be able to help with this, and it could prove useful in the future.
0:24:35 - Alex Shevelenko
It's more polite, and if you give it enough prompts, it could come out exactly right. It was a much softer, more humane language.
0:24:48 - Andy Cunningham
I think I should say one more thing. I believe we're entering an era, because of AI and the fear surrounding it, where the human side of everything is going to become a bigger deal. I think it's becoming more important because now we have to pay attention to it. We're all afraid that AI might take over the world and that we’ll lose the ability to control it. So, I believe we’re moving into a time where brands are going to focus more on the emotional connection they build with their customers.
0:25:17 - Alex Shevelenko
I certainly hope you're right. I think the motto we have in our organization is, "Experience is the message." It’s about moving beyond language because AI is getting pretty good at language, at pseudo-personalizing it. The focus is shifting to the broader experience. Take Apple, for example—it was like an experience theater. Everything from the moment you enter the store to the moment you receive a package, that whole unboxing experience, was multi-sensory. I think people got caught up in the language component of AI because it's easy to understand, but the best communicators, the best-positioned brands, created remarkable experiences.
Experiences that were powerful enough to drive word-of-mouth, which is the most compelling sales force you could ever have.
0:26:24 - Andy Cunningham
Absolutely. Experience is where the rubber meets the road. I love that motto because it's so true. It’s all about the experience, and that experience is multi-sensory—that’s another great word you used. Today, we have to think about how we build brands in a multi-sensory way. It’s not just about a logo like it was back in the 70s when Jack Trout and Al Ries wrote that first book on positioning. Back then, it was all about advertising. You could just create whatever image you wanted and say whatever you wanted, and that would influence people. But now, people are influenced by all these different channels, their peers, likes, reviews, and so on. It’s a much harder world today.
0:27:07 - Alex Shevelenko
I agree. It's interesting that you bring up Trout's book. It's kind of ironic—despite having a Wharton undergrad and a Stanford MBA, and having taken marketing courses, that book wasn’t part of the core curriculum.
0:27:27 - Andy Cunningham
What was the book? Was it Peter Drucker’s book?
0:27:30 - Alex Shevelenko
Well, one that really stuck with me and was a precursor to the kind of ideas I took away was Cialdini's book on influence, Influence: The Psychology of Persuasion.
0:27:42 - Andy Cunningham
Yes, and that’s a great one.
0:27:43 - Alex Shevelenko:
I discovered, right before Salesforce went public, I was doing some consulting there. I did a summer internship, and they had a bunch of books you could pick up and use, and they encouraged that. I was doing marketing work, and most prominently, they had all of Al Ries and Jack Trout's positioning books. They were all there. When you start thinking about "no software" and everything else happening at that time, it was a master class in positioning that Salesforce was doing back then. Pretty much every year and a half, they reinvent themselves, whatever the new trend is—Mark [Benioff] is agile enough to jump on it and become the "social company," the "AI company," or whatever the next thing is. They still manage to maintain the genuine thread of being customer-centric, which is really a customer-focused company.
One of my hopes is that people earlier in their careers read your book and understand that the most successful companies, at least in the technology world that I observe, really study this. Salesforce adapts these principles, and they're creating a Disneyland-like experience with Dreamforce coming up. It's like the B2B version of Disneyland, with fuzzy animals and all. I have to tell you, my kids got one of those stuffed animals, and it's my daughter's favorite toy. You know, what do you do with that? That train has left an emotional connection to the brand.
0:29:40 - Andy Cunningham
By the way, I want to point out something about Mark Benioff. He is a brilliant marketer—one of the best marketing CEOs I've ever seen, met, or heard of. His book Behind the Cloud tells the story of how he built Salesforce through marketing. It's amazing.
0:30:01 - Alex Shevelenko
I think marketing was a core focus for him, and I think he approached it holistically. Now, I want to shift gears a little because, while we come from a marketing and corporate communications background, we found this huge gap around HR communications and employee experiences. You mentioned that CHROs are the people who care about the "soft" aspects, like communications. I see a bit of a contradiction here. Maybe companies are a little better on the recruiting side, but we see huge problems when it comes to compensation and benefits. Compensation is the largest expense, and benefits are the second largest expense for every company, right? A quarter of our GDP is spent on health and benefits-related matters. To quote Warren Buffett, GM is a health and benefits company with an automotive division, right? Something like that.
When we look at benefit communications, nobody understands them.
0:31:21 - Andy Cunningham
Right.
0:31:21 - Alex Shevelenko
I'm not even sure the insurance carriers who write these policies understand them. Brokers struggle, HR struggles, and employees and their families have to make life-changing decisions about healthcare. Companies are spending a lot of money on something that's supposed to retain, delight, and keep employees happy, yet they're all stressed about going bankrupt over a bad healthcare event, which is a major issue in America. So let's dive into what's going on with employee experience, employee communications, and positioning. Where do you see people leading, and where are they falling behind?
0:32:18 - Andy Cunningham:
Great question! Because what I'm seeing now from people coming to me for help is that we not only need to refresh our regular brand, but we also have to refresh what they call their "employer brand," right?
Now, this notion of an employer brand has become a big deal. To me, they should be the same thing, but people are really thinking about how they’re going to attract the talent they need and keep that talent. So all these things you're talking about—benefits, compensation—it’s all about retaining your workforce.
0:32:51 - Alex Shevelenko
That's what it's all about. Well, attracting too. So we work with some companies on transforming employee benefit experiences, and it's amazing to see that a lot of them now send a general presentation on benefits right after they send the job offer. In industries like healthcare, where there’s a significant shortage of nurses, for example, the next step is to say, "We're investing in this, and we want you to know about it because it's an attraction point." You're right—it’s all about both attraction and retention.
But I hear about the intention, right? Like, we all agree it's a good idea, but I've worked in HR tech for a long time at a company called SuccessFactors, and I’ve never felt that visual design was a strong point for most HR departments. I think you'd be lucky if the CEO cares and brings that spirit into it. Companies like Facebook, for example, bring in technological innovation and redesign their tools, but... how do you see it? There’s positioning, and then there's the execution. Do you think there’s a breakdown in execution, or am I not seeing the full picture?
0:34:24 - Andy Cunningham
No, I think it’s starting to change because attracting and retaining talent has become a huge deal since the pandemic. It's always been important in tech, but now it's a really big deal because employees are in charge. They tell employers, "Here's what I want. I’m going to work remotely, even if you don’t have offices in my city. I want these benefits, and I want this salary."
The balance of power has shifted to employees, and they move around a lot more. They get a better offer elsewhere and leave. So, companies are now starting to think about building a better emotional connection with their employees than they had before. This is why the employee experience has become so critical—it feeds that emotional connection to the company. It’s more than just providing free food and massages.
0:35:24 - Alex Shevelenko
It's about culture, values, contribution, and inspiration—those bigger things that matter. Got it. Do you think this is unique to the tech industry because of the talent shortage, or is it a global trend?
0:35:51 - Andy Cunningham
Well, the cat is kind of out of the bag. I work with a small media company in Dubuque, Iowa. They're in the middle of the Midwest, and they’re in an old business—the media business—but they are also experiencing rapid turnover. It’s not as bad as what we see out here with Meta, Google, or others, but their employees are still finding opportunities elsewhere. They handle it by being structured under an ESOP, which means their employees have stock ownership. All the employees are owners.
That helps a lot because it gives them an emotional connection to the company, and I think it helps prevent the kind of employee loss that other companies without that structure face. But I do think the cat’s out of the bag. In tech, it’s much worse because the talent shortage is enormous, especially with AI. We simply don’t have enough AI engineers, just like we don’t have enough NVIDIA GPU chips to meet market demand. And the same is true for AI engineers.
0:36:59 - Alex Shevelenko
In that world, do you feel there’s a significant disparity between those highly prized roles within a company and the ones that are still part of the employer brand but maybe not as in demand? How do companies reconcile that? For example, in large organizations like Accenture, which we’ve collaborated with in a number of ways, I like how they describe themselves as a "culture of cultures." They have different teams with a common thread, but there’s enough diversity to cater to various needs. When you have 600,000 employees worldwide, you need that diversity. Are you seeing this kind of micro-segmentation of employee experiences within organizations, where some employees are treated like "first-class citizens" while the rest are in a different category?
0:38:15 - Andy Cunningham
Yes, I think that’s true in some industries. Today, I was listening to Bloomberg, and they were talking about the new sports compensation system around athletes' names, images, and likenesses, which they’re calling NIL (Name, Image, Likeness). NIL is designed to compensate athletes for their talent, but it's primarily for the top athletes, not the supporting ones. Similarly, in tech, the top engineers and designers get better deals than the others—that’s just the way it is. I have a client who started a company after being a great engineer at Google. But even though he was one of a million engineers there, when he decided to leave, Google offered him $10 million to stay. That creates a huge disparity—how many normal engineers at Google are getting offers like that?
0:39:20 - Alex Shevelenko
Right, so do you think there should be one employer brand or multiple employer brands? One of our podcast guests, Peter Fader, a thought leader in customer centricity, suggests that you can value customer lifetime value very precisely across different industries, and some customers are disproportionately more valuable than others. The question is whether we’ll see the same pattern within organizations. Should there be multiple employee brands? For example, people in unions or nurses might get one set of benefits, while doctors and medical personnel get another. This is probably accepted, but I’m curious about your thoughts on whether we’ll start to see this emerge—are we going to mirror the customer world?
0:40:28 - Andy Cunningham
Yeah, that’s a very interesting perspective. I hope that doesn’t happen, but I think you may be right—it may be moving in that direction. I think companies will do anything they have to do to keep people, right? Sometimes those benefits are kept secret, though. For example, offering someone a $5 million bonus to stay—that’s not something they’ll announce as a general benefit.
0:40:53 - Alex Shevelenko
I’m staying on this podcast, Andy. I’m in!
0:41:00 - Andy Cunningham
You're in, so yeah. I think that’s an issue. But another trend in benefits, which I’m sure you’re aware of, is that now there are multiple options for employees to choose from. You get a certain amount of money, and you can decide how to allocate it. You might want healthcare, fitness, or even pet care. There are all kinds of new options. So, even though it’s not necessarily about giving different people different things, the options allow employees to customize their benefits.
0:41:28 - Alex Shevelenko
Yeah, I think that’s a liberating opportunity. Organizations that introduce this kind of flexibility are gaining a competitive advantage in the market. So, let’s shift gears. We’ve talked about incredible individuals, and in one of your episodes on The Marketing Book Podcast, you mentioned that Apple under Steve Jobs was clearly a missionary organization. The next big thing kept happening again and again. After Steve passed away, Tim Cook tried to replicate some of that magic, but it hasn’t quite worked. Let’s dive into this narrative of visionary CEOs and what happens when they leave a company. How do organizations cope, and what do you see as ways to maintain the trajectory after a CEO’s departure?
0:42:37 - Andy Cunningham
Well, I think a lot of times the trajectory shifts, which is okay because companies can be successful in many different ways. If you look at Apple—part of what you left out from my quote was that Tim Cook inherited assets that he multiplied over and over again, turning Apple into the world’s most valuable company. Satya Nadella at Microsoft is another example. He wasn’t the visionary founder, but he’s been able to transform Microsoft into one of the world’s most valuable companies.
In my opinion, what needs to happen is that the leader at any stage of the company must understand the highest value that can be created at that time. For Steve Jobs, at that time, the highest value was continuous innovation and using his visionary abilities to anticipate the next big thing. When he passed away, Tim Cook stumbled a bit at first, trying to do the same, but he eventually realized that he couldn’t be Steve. What could he do? He added tremendous value to Apple’s ecosystem, though in a different way from Steve. The same applies to Satya Nadella, and I believe the same will be true for Amazon. The value going forward won’t be the same as what Jeff Bezos contributed, but that’s okay—value will still be created.
So, I don’t think we should view the departure of a visionary founder as the end of the road for a company. It’s actually the beginning of a new phase of growth and mass attraction.
0:44:17 - Alex Shevelenko
This is a really helpful insight. So, you mentioned companies that succeeded in making that next step. But there are quite a few that don’t achieve as much success, even with trillions in market cap added on, right? What do you see as the difference? Is it a matter of constantly learning and re-examining themselves, or shifting to different models? How would you distinguish between the winners in that next chapter and the losers?
0:45:00 - Andy Cunningham
Yeah, that’s a great question, and I’ll go back to something I mentioned earlier. I think it’s the soft issues of leadership that make the difference. I had the opportunity to work with Kodak three times under three different CEOs as they attempted to capitalize on the digital transition with digital cameras. Your listeners probably know that Kodak invented the digital camera. You’d think they would have figured out how to capitalize on it, but here’s what happened to companies of that era: they fell victim to their share price and shareholders.
Kodak was selling so much film that focusing their attention and resources on digital meant taking away from film, creating a dilemma where they couldn’t fully develop the digital side to market it. Eventually, someone else did, and Kodak fell off a cliff—they couldn’t reignite it. The person who changed this practice of bowing down to shareholders at every turn, which was common in the 80s and 90s, was Reed Hastings at Netflix. If you remember, Reed made the shift from the red-envelope DVD rental business to streaming. This caused a lot of shareholder unrest and anger, and the stock price tanked. But Reed, being a visionary, knew streaming was the future, and he just had to get through that rough patch with shareholders to come out stronger on the other side. Previous CEOs couldn’t do that—they couldn’t see past shareholder value and weren’t willing to make that leap, but Reed did and was the force behind that jump.
0:46:58 - Alex Shevelenko
Interesting. So, I would say shareholder value was tied to success in a particular category, right? These companies were successful in a certain category, with a business model aligned to it. Then a shift happened, whether in consumer expectations, technology, or economics—those usual three suspects—and a new category emerged. Some companies, like the ones you mentioned, were able to jump into the new category, lead it, make tough decisions, and even sacrifice their core business. I can tell you, even as a small company, making these shifts is incredibly hard—it’s like killing your own children a little bit.
0:47:45 - Andy Cunningham
It is like killing your children.
0:47:47 - Alex Shevelenko
Yeah, and not that I’ve ever done that, just to be clear! No plans either, if you’re listening to this. But the fascinating part is making that leap into new categories, right? Having the vision to spot it and the discipline to make tough decisions around the business. Let’s talk about the relationship between category design and positioning, because they’re closely aligned, but they’re not the same. I’d love to hear your take on this.
0:48:29 - Andy Cunningham
Yeah. First of all, I'm a little different from the Play Bigger team, who believe you can constantly create new categories. I think creating a new category is an incredibly rare event. Incredibly rare. For one thing, the word "category" implies there’s more than one company in it, so you're not really creating a category; you're creating a new space that you may or may not attract others into, right? To me, it’s a much more nascent concept than actually creating a category. It's also very expensive to try to create one.
I've worked with several companies that insisted on creating a category with their product. They spent millions and millions of dollars, and they never got there because it's incredibly difficult. What I prefer is for people to think about categories much more strategically. You can move yourself from one category to another if you choose. For example, Reed Hastings did that. He was in the red-envelope business and moved into streaming, which already existed. He didn’t invent streaming, but he shifted the company into that category, which carried a lot of risk. The shareholders were like, "Wait, wait, wait, what are you doing?" But strategically, it worked.
In my book, I talk about the category creation we did for Cisco, and that was a very unusual case. Cisco was in the hubs and routers business, and what John Chambers said to me when he brought us on was, “I know we can stand for something much more than hubs and routers, but I don’t know what it is.” At that time, we looked around and saw the internet emerging, and we thought, “There’s Microsoft owning the software part of the industry and Intel owning the hardware, but nobody’s owning the internet part because it’s too nascent.” Hubs and routers were essential to making the internet work, so we suggested to John Chambers and Cisco to take on that role. We moved them from the hubs and routers category to what we called the internet economy category. It changed everything for Cisco.
So, you need to think about categories very strategically. It’s not just about moving from one segment to another. Sometimes you can join categories that don’t typically include companies like yours, as Cisco did with Intel and Microsoft, or you can follow new models, like Reed Hastings did with streaming. It’s a very strategic decision that informs your positioning, and by the way, context is everything when it comes to category. We could never have done that with Cisco had the internet not been emerging. It just wouldn’t have worked.
0:51:25 - Alex Shevelenko
That's very interesting. I remember hearing another story from you about how you helped John Chambers position himself, making him a peer to Andy Grove, the CEO of Intel, and Bill Gates at Microsoft. He would only speak at events where the other two were present. That sounds like it was personal positioning aligned with the company’s positioning.
0:51:51 - Andy Cunningham
Yes, that was a tactic we used to reinforce the move from hubs and routers to the internet economy. By having Chambers stop speaking at all those engagements focused on hubs and routers, and only appear alongside Andy Grove and Bill Gates, we created the illusion that those three were in the same league. The press picked up on it and called it “Wintelco”—for Windows, Intel, and Cisco—and it just took off.
So, category is a highly strategic decision. One last thing I’d like to say about categories: Don’t let Gartner and Forrester define your category for you. They have a business model based on telling you what your category is, and that’s fine, they can keep doing that. But when it comes to positioning your company for value creation, you own your category. You own the decision, not Gartner or Forrester.
0:52:49 - Alex Shevelenko
Yeah, I think one of the more interesting things that is still not very well understood is how to take people from an existing category or product space and find early adopters who can move into a new space. This new space is where you want to be the leader, whether you call it a category or a new positioning. The reason I think companies fail—and why it’s so difficult—is because people often believe these categories are completely separate. They think they can create a new category out of a vacuum, as if it magically appears. In reality, there are already people trying to do similar things elsewhere who are either failing or not fully satisfied. You need to identify this select group and pull them into your new category, whatever Gartner might have labeled it as. If you can address their needs with a new approach, you have a better chance of success.
It feels like that part is much harder than simply brainstorming new categories.
0:53:58 - Andy Cunningham
Yeah, right. It’s easy to come up with new categories but very expensive to turn them into reality. Another thing to consider is what Jack Trout and Al Ries said in their first book on positioning: it’s about real estate in the mind of the customer. When you’re creating a new category with a new name, do you think there’s any existing mental real estate for that? None—there's zero. You have to identify that real estate first, stake it out, then buy it and defend it. This is very expensive and time-consuming, almost impossible.
So you’re better off entering an existing spot of real estate in the customer’s mind and differentiating within that space. Create a subcategory. This is what Dodge did with the minivan. They were in the automotive market, and when the minivan opportunity arose—which, by the way, was somewhat accidental—they created a new subcategory within the automotive space in people’s minds. They made it clear: "This is a car just like every other car, except it has this additional functionality." The best way to create a new category is to think about it as a subcategory so you can enter a familiar space in the customer’s mind, rather than an unfamiliar one.
0:55:14 - Alex Shevelenko
And I think that’s fascinating. Bringing it back to Cybertruck, which those of our audience in California are probably seeing more than others—
0:55:24 - Andy Cunningham
There are a lot of them around.
0:55:31 - Alex Shevelenko
Yes, it’s a category in itself, almost a category of one. It’s a brilliant way of positioning something so unique that it cannot be confused with any other truck, electric or otherwise. Regardless of what you think of the experience, for the right people, there is no confusion. You don’t have to choose between Ford or some other truck; this thing stands alone.
0:55:53 - Andy Cunningham
Exactly, but that's a subcategory of what Tesla was already doing.
0:55:58 - Alex Shevelenko
Interesting, right? So that's a subcategory within Tesla. I’m going to start wrapping up because we could go on forever here. I’m learning so much. Last question: What would you say is the branding opportunity for individuals? How do they position themselves in a world that’s so noisy?
0:56:33 - Andy Cunningham
Yeah, I think having a really outgoing personality is probably the number one criterion for being able to do that. So that’s the first thing. Secondly, if you look at all of the internet influencers—people online acting as influencers for makeup brands, fashion brands, experience brands, travel brands—they all have super outgoing personalities and they love to illustrate how they stand out as individual brands. It’s either the way they dress, the way they look, or the way they talk. People want to be like that; they want to stand out. Everybody wants to stand out, but not everyone is capable of doing it.
So, first, you have to have the underlying capabilities to build a personal brand. Then, it’s about content. This is what I love about your content experience platform. It’s all about content—content, content, content. Written content, video content, image content. Everything is about how you build your brand, and the more you do it, the closer you’ll get to building it.
0:57:48 - Alex Shevelenko
Brilliant, Andy! You stand out over generations, bringing lessons from the past and applying innovative ideas today. It was such a great chat. Where can people pick up your book and connect with you?
0:58:05 - Andy Cunningham
Thank you. The book is on Amazon. It’s Get to Aha by Andy Cunningham, and I would love to get people’s feedback on it. You can reach out to me at [email protected]. I’d love to chat with people about their opinions on all these matters of marketing. You can also reach me through my company’s website, which is gettoaha.com (G-E-T the number 2 A-H-A dot com).
0:58:34 - Alex Shevelenko
Brilliant! Well, everyone, please do that if you want to understand what Steve Jobs had as an unfair advantage. Thanks, everyone. Thank you so much, Andy, for sharing your expertise!