Lead Generation Articles & Book Reviews

I want to tell you about an idea I learnt from one of my mentors, Rich Schefren.

It’s called your Core Concept and it has the power to differentiate you in the minds of your potential customers and clients.

The Core Concept is the big idea which is used throughout your marketing and goes deep into your products and services. It’s an idea that gets your prospects excited because you’ve helped them understand their problems in a new way.

Instead of tackling the symptoms and effects of the problem or problems, you’ve helped them to see the cause of their difficulties in a way that makes sense to their minds and emotions.

My Core Concept is about how differentiating your business is the solution to many of the problems which business owners suffer from – low sales and profits, difficulty explaining what you do and a lack of purpose and vision. Quite simply it’s tough running a me-too business but it’s fun owning a business designed to provide great value to  a special group of customers.

I want to talk more about Rich Schefren‘s Core Concept and especially the one that made his name in his first classic report, the Internet Business Manifesto.

The big idea or Core Concept is…

“Opportunity Seekers struggle and fail while Strategic Entrepreneurs succeed massively”

Simple isn’t it?

But it’s also very profound.

There’s a huge problem in Internet marketing where punters buy “magic buttons” for get-rich-quick schemes from greedy gurus.

To be fair, that may not be what they are selling – there are some excellent training programs out there packed with great information if people do the work – but people want the silver bullet.

When they realise that the first opportunity is going to involve that terrible four-letter word… WORK… they decide it’s not for them. By then there’s another magic solution being promoted, and they jump on that.

And keep repeating the cycle because they want big money with little time and effort.

If only life was that simple.

Sure you can learn from the experts but you still have to make stuff happen yourself.

Anyway the Internet Business Manifesto was a big wake-up call to Internet marketers in this opportunity seeking mindset.

It highlights the craziness of what they are up to and it promotes the Business Growth System from Rich Schefren.

Rich Schefren goes into the Core Concept in one of his reports from the Founders Club – “The Single Element Critical To Your Marketing Success: How To Leverage A Core Concept To Go From Mediocrity To Millions.”

In this special report, he goes into detail of how the Core Concept works focusing on the Internet Business Manifesto.

The Core Concept doesn’t just apply to reports.

You can see the same ideas incorporated in the webinar used to promote the Business Growth System. Learning the idea is useful but the big bucks come from taking the idea and applying it in your business.

Do it right and you’ll blaze away from your competitors. No longer are you a provider of general services with many alternatives. Instead, you are positioned as the person who has redefined their issues uniquely and as such, you have the only solution.

I’m still working on my Core Concept and how I can frame it in a way that shows many of the fundamental business issues come back to the issue of business design and creating a unique, differentiated solution.

You can see the tie up and why I am so excited by the Core Concept idea.

If you are going to write an information report and you want it to create demand for your product or service – or if you’re going to create a video presentation – the time you spend understanding the Core Concept and developing your own will make a big difference to your success.

Many people have information reports – but it’s rare that any focus on such strong ideas that they create million-dollar selling products. That’s what Rich Schefren has done time after time.

You don’t have to be an Internet marketer to benefit. It will work just as well for professional services where you still need to demonstrate that you have a unique perspective.

It’s what will differentiate your business and attract clients.

In this article, I will look at the issues involved with finding and selecting a niche market that will help your business to attract, convert and keep customers.

What Is A Niche Market?

A niche market is a small segment of a bigger, more general market that you can specifically target in your marketing and sales efforts. Done right, niche marketing goes even further because it completely affects the way you design and operate your business.

Defining a niche market needs me to define a market.

A market is a group of customers with specific wants and needs who decide to buy particular products and services for what those items can do for them.

By definition, the car market is the big group of people who buy cars.

That’s self evident.

But you need to go further.

The car market is the group of people who buy cars because they want or need flexible, personal transport that puts them in control of where they go and when they go.

That definition helps you to understand why people buy cars rather than use public transport as a viable substitute product or service.

Two seater sports cars is a niche within the car market for people who only need to worry about transporting themselves and possibly a passenger and want to do it in a certain style. Buying a sports car says a lot about the person and what he or she values. Even this niche can be to big which is why there is a one seater sports car (the Briggs Mono).

Why You Need A Niche Market

In some ways it makes sense to think that you want to target a big market rather than a small one. It gives you more customers who could buy your product.

There are two flaws in this thinking.

1. You should be more interested in the balance between demand and supply in a market. A huge market where there is already more supply than demand is going to be extremely competitive and it’s going to be difficult to make a profit. If demand is much bigger than supply, then prices and profits can be high and customers have little choice than to buy (although this may change over the long term as new competitors enter the market).
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2. A smaller, more focused market means that your product can match the wants and needs of the customers while a bigger, more general market has more diverse needs and you can struggle to convince possible customers to make the buying decision, which means you miss the marketing bullseye.

Effective marketing is all about getting the right marketing message or offer in front of the right customers in the right way at the right time or as often as necessary (the 4 Ms Of Marketing).

Having a niche makes it much easier to:

• get the message right
• get the choices about marketing media right
• keep putting the message and offer in front of the eyes and ears of possible customers.

I can’t emphasise enough how important it is to see marketing as a process where through a series of contacts you turn someone who has a general problem, want or need into someone who trusts you enough to give you money for the product or services you can provide. It rarely happens in one contact or touch unless the problem is urgent.

The Three Big Issues To Confront When Choosing Your Niche Market

In my article, Will Your New Business Succeed? I talked about the three big risks:

• Demand risk
• Competitive risk
• Capability risk

All three need to be considered when you are looking to choose your niche market.

Thinking about the demand risk for your niche market:

• is the demand real? Will customers pay enough money to solve the problem or to meet their wants and needs? You only need to watch a TV programme like Dragons Den to see would be entrepreneurs trying to solve a problem that few other people care about.
• is demand big enough to support your business? This is a particular problem for businesses who find that demand is restricted by location issues. Conversely the Internet has made many more niche markets viable because it can bring customers from all over the world to a business.

Competitive risk means facing up to issues like:

• Will the business be able to sustain a competitive advantage in terms of cusstomer alue that encourages people to buy based on a low price or superior value?
• Will new suppliers enter the market or are there effective barriers to entry to stop or delay competitors?

Capability risk looks at the issue of whether the business has the capabilities and competences needed to deliver on the promises made in marketing to attract and convert customers.

Niche Marketing And Differentiation

Are niche marketing and differentiation the same concept?

No I don’t think they are but the ideas are related.

When you select a niche market, you cut down the number of competitors and customers who will be attracted to that niche.

Perhaps there are 50 competitors in the general market but only 5 in the niche. Think about moving from looking at small hotels to 5 star luxury hotels in a small city for example. The differences between the two groups is much bigger than teh difference within the groups.

When you’re differentiated, you create a market of one. If the customer wants the value proposition you offer, he or she has to buy from you.

Some times, selecting a niche automatically differentiate you from your competitors because no other business has chosen to target that particular niche. Going back to the hotel example, perhaps there is only one 5 star luxury hotel in a small city.

How To Find Your Niche Market

At its core, your niche market defines:

• Who your customers are:
• What they want and need to buy

Occasionally it can also involve some of the other big questions that can be used to differentiate your business – where, why, how, how many and how much.

I think it’s useful to draw a customer value map of the market you are working within or thinking about entering. This will encourage you to think about the different price points that customers buy at and the different customer value alternatives.

Many people find it difficult to think abstractly about a market and what customers want and need and persuades them to buy. It’s easier to compare two offerings at a similar price point and to see how they are similar and different. This lets you focus on the factors of differentiation.

You can do the same exercise at a different price point (it can be useful to look at economy, mid-market and premium prices) to get a better idea of the dimensions of differentiation.

Let’s think about cars again as the brands are meaningful worldwide.

A Rolls Royce and a Lamborghini may have very similar prices and they both meet the need to combine personalised transport with status but the attributes of the customer value proposition are very different and aren’t in the same niche market.

The customer value attributes of these cars are very different in some ways but similar in others. Both are expensive, offer massive prestige and status (who says “he only has a Lamborghini or Rolls Royce”?) and have big powerful engines that make the cars much faster than the average car.

The Rolls Royce emphasises comfort, space, ride quality. The Lamborghini has head-turning looks, incredible performance and astonishing road-holding and handling.

It can be worth looking at where customers have to make compromises and how readily the customers accept the problems. Anyone who can afford a Lamborghini or Rolls Royce probably doesn’t need to care about fuel consumption but perhaps the person has green views and would prefer lower emissions and more miles to the gallon. Depreciation may also be an issue if the person wants to replace the car every twelve months. These issues can help to explain how products can be differentiated within a niche market.

Once you’re clear on the main dimensions of differentiation, you can look at the different combinations that already exist in the market.

It can be useful to map two dimensions on an x-y graph so you can see how the competitors fit together. A 2×2 or 3×3 matrix can give you enough detail or you can increase the number of categories along each axis.

Think about the car market and the number of seats and price for example. To my knowledge, there is only the Briggs Mono that has one seat, so whatever price point it occupies, there is a potential niche to either side in price. In the mass market sectors, there will be a lot of cars with four and five seats around the main price points. These niches already have competition.

However, if you take one of those differentiation dimensions (e.g. number of seats) and then combine it with another (fuel economy) you may find that what looked like a busy niche has an opportunity gap.

Remember, if you’re looking at a niche market without any existing competitors, you need to consider demand risk very carefully. Perhaps there’s a good reason why this niche market is empty. If there are already competitors and the niche doesn’t subdivide nicely on another factor of differentiation, you need to think about whether you can survive competition by having low costs by producing at the minimum efficient scale.

By this stage, you should have a few ideas for the niche market you want to target in terms of the who and want (and possibly the other big questions).

At this stage your niche can have competitors because you’ll be looking at how to differentiate it within the niche later on.

The concern is whether the niche provides the opportunity for profit over the longer term. You don’t want to target a niche and find that it disappears after a couple of years.

The two main strategy models to think about are:

• PEST Analysis
• The Five Forces Of Industry Profitability

Many people are familiar with these two techniques but they are often done badly and therefore provide little of the long term insight that may be available about how the niche market can develop.

The SKEPTIC Model combines them together which can be useful if you’re jaded about the two individual strategy techniques.

As you look forward, you may find yourself looking at different potential trends and perhaps a few either/or situations. If these look to offer significant strategic risk, you may need to use scenario planning to develop a clearer view of the future.

Once you’re satisfied that your proposed niche has a good future, you can start looking in more detail at your strategic options. This will usually involve summarising the strengths, weaknesses, opportunities and threats in a SWOT chart.

If you’ve got an established business, you need to look at how well it can serve the chosen niche market. The value chain is a useful technique for looking at internal capabilities and resources and how everything you do ties together to form your competitive advantages.

If you’re starting a new business in a niche, you have the luxury of designing your business model from scratch.

Either way, you need to try to avoid the mistakes made in differentiation and not let your mind fall into any of the niche marketing myths.

Summary Of How To Choose Your Niche Market

Choosing a niche market can be easy for some people. The answer is obvious based on their past knowledge and experience or a huge gap in the market that is crying out to be filled.

Other people find it much harder. It is scary to choose a niche market or to differentiate a business within a niche.

Selecting a niche means saying Yes to some combination of customers and products/services.

More importantly it involves saying No to many more alternative combinations.

The strength and big advantage of niche marketing is that it gives the business focus, hopefully laser focus on a particular set of customers, products and services and the underlying capabilities needed to deliver customer value at a fair price. It gives the business a strong vision and makes it easier to ignore opportunities that arise outside of the vision.

How Did You Select Your Niche Market?

I’d like to collect a series of stories about how businesses decided on particular niches so if you’ve got a niche, please leave a comment.

Marketing Bingo is my game for checking that your marketing hasn’t fallen into the trap of being too similar to your competitors.

This is a practical example of applying Yellow Pages Bingo to the Accountants market.

When I wrote this article (originally posted on my Differentiate Your Business blog in February 2011) I looked at the Yellow Pages for accountants in Central Birmingham.

I find accountants are a good example to use because it’s a service used by nearly all small businesses and many struggle to select the right accountant for their needs.

I’ve split it into three sections – description of the accountancy firm, services and offer – of phrases that are regularly repeated.

Description of firm

• For the self employed
• For business and individuals
• Specialists in local businesses
• Small business specialist
• Friendly
• Professional service

Services

• Accounts preparation
• Tax returns /  self assessment tax returns
• VAT
• PAYE
• Corporation tax
• Construction industry scheme
• Payroll
• Book-keeping
• Management accounts
• Business start-ups
• Company formations

Offers

• Free initial consultation
• Sensible fees

I have to admit that in the latest edition of the Yellow Pages, there weren’t as many advertisements from accountants as there have been in the past. Perhaps the recession has forced some to cut back and others believe that the Internet is a more natural place to look for an accountant.

What happens in any market when every supplier looks the same?

The choice comes to either the cheapest or the most convenient.

Neither is a very good way for selecting a service which could have a very big effect on your business success.

This damages the accountancy firms who do a great job of supporting small businesses because their differentiation factors are not being communicated (see How To Differentiate An Accountancy Practice) and even worse, it damages the small businesses which don’t get the essential finance advice they need to grow successfully.

It’s Your Turn To Play Marketing Bingo For Accountants

Take your pick, yellow pages or websites because both bring local accountants together which emphasises the importance of being differentiated.

Then have a look to see if you can see any examples of accountants who do stand out, who have differentiated themselves.

Or can you just see the clichés – “we are a friendly and professional accountancy practice which specialises in small businesses…

Then Take A Look At Your Own Market & Play Marketing Bingo

My purpose of this blog is not to make fun of accountants but to make a serious point about marketing which in many ways is “anti-marketing” (doing the opposite of what you want) in a service you can relate to. Indeed, you may well have struggled with the choice “which accountant should I go to?”

Be brave and take a look at your own website, your own website, yellow pages advertisement, your own brochure and compare it with your competitors.

If you are saying the same things – blah, blah, blah – then you have a problem and you need to fix it by:

• Identifying what makes you special and different; and then
• Communicating it to the market

Management-speak bingo is a fun game employees can play while listening to senior executives give a rallying call to the troops.

They pick ten popular management buzzwords or phrases along with their fellow players and wait for the esteemed leader to call them out.

If one gets a full house – every phrases they’ve selected has been mentioned – then they win.

That may seem silly to you as a small business owner – although I’m sure you’re hoping that your staff don’t play management speak bingo on you – bit what if you’re doing it to yourself in your marketing.

I have a variation on the management-speak bingo game called Marketing Bingo, Yellow Pages bingo or Website bingo, depending on which is your main source of leads who are looking for what you sell.

This time you select the five or ten words or phrases which best describe your business – they will be on your website home page and Yellow Pages advertisement won’t they?

And then you play Bingo by seeing how often they appear on your competitors yellow pages and websites.

In my Marketing bingo game, you’re not looking for the words to be repeated. Just the opposite.

You win if half or more of your keywords are not used by competitors.

That means that your message is different and has a chance of standing out and attracting attention.

But if more than half your keywords are also used by competitors, then your marketing messages merge into one and your customers get confused.

And a confused customer is a reluctant buyer.

Here is an example of Marketing Bingo – Marketing Bingo For Accountants

I want to tell you about Jay Abraham’s Three Ways To Grow A Business.

This is very different from the famous Ansoff Business Growth Model which can be thought of as the four ways to grow a business.

The Power Of Business Models

One of the big advantages of uses a “business model” is that it helps create a shared view of the way the business works and the way it can be improved. That’s the same when you use a strategic model to look at the environment like Michael Porter’s Five Forces.

I make this point in my Profit Tipping Point Report, but there is a tendency to over-complicate business and focus on too many tactics without getting the bigger things right.

The Three Ways To Grow a Business

The three ways to grow a business are:

1. Increase the number of customers who buy
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2. Increase the average sales transaction value
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3. Increase the number of times a customer buys

It’s a very useful framework because often when you look at strategies to grow the top line, the automatic focus is winning more customers (method 1) and little attention is given to getting more sales from the existing customers in terms of selling more and more often.

The Three Ways To Grow A Business Video

[continue reading…]

If your marketing dazzles like a zebra, then potentially you’ve got a big problem.

Let me explain.

On its own, a zebra is a beautiful creature unlike anything else. You can think of it as a stripy horse but smaller.

I took this photo on a safari holiday in Botswana many years ago and I think it makes the point well.

Just like your marketing, a zebra looks good on its own.

But zebras normally hang around in groups or small herds. In fact the collective name for a zebra is a “dazzle” for one very good reason.

When in a group, it’s difficult to see where one zebra ends and another begins.

In fact, it is a challenge to even count up how many zebras are in the photo because of the angles and the way the stripes confuse the eyes.

This trick works very well for the zebras because it helps to protect them from predators like lions. Apart from a powerful kick, the zebra doesn’t have any defence but if a lion can’t single out one animal from the dazzle, it won’t attack.

Not standing out from the crowd is good for zebras but it’s a killer for your business.

Just like zebras tend to congregate together, your customers are looking at your business along with your competitors.

It’s the way old Yellow Pages always worked by bring you and your competitors together and forcing a difficult selection decision. It’s the same with the Internet.

There’s another problem too.

The on-tap power of the Internet to give your customers access to the information they want, when they want it, means traditional outreach marketing – which lets your business be the equivalent of the single zebra standing on its own – is less effective. Potential customers see little value wasting time on things that interrupt them when they are not relevant and when they can go to Google and find everything when they want it.

This puts the emphasis on your business to be different, to look different, and to feel different in some way that matters to the customer.

Or your customer will decide that you and your competitors are much the same.

Which gives you a problem.

Because your customer will decide that the only difference that matters is price and the lowest price wins the customer’s preference.

That’s bad for you, bad for your profit margins and bad for the customer who may actually have special needs which aren’t being catered for – see Is Your Marketing Hitting The Bullseye?

How Your Marketing Becomes Zebra Marketing

It is very easy to fall into the zebra marketing trap.

You look at how your more successful competitors are marketing and you borrow phrases and ideas which you think will appeal to your customers.

In fact, you’re probably right to do so.

There will be some things that really matter and you should cover them in your marketing – see key success factors.

But you don’t want to find yourself playing marketing bingo where a customer will look at five competitors and see the same “you must buy from me” reasons from each of them.

Stop Being A Normal Zebra

You need to find a way to make your marketing stand out. If Seth Godin can have a Purple Cow, I can have  Pink Zebra.

Your marketing needs to emphasise your unique selling point or your key factors of difference if you have more than one. It’s much better that these differences are genuine and not a case of “jazzing up your marketing to look different” when the underlying product or service is the same – see You Want Deep Not Shallow Differentiation. This isn’t a case where you want to “razzle dazzle them” as Billy Flynn in the musical, Chicago would try.

You need to give your business a chance to attract attention and to create preference with buyers. It’s true that not everyone wants a pink zebra but some will if you make sure your differences are important to your target group of customers – see How Important Is Your Difference?

What If You’re Guilty Of Giraffe Marketing?

Did you notice the giraffe in the photograph of the zebras?

You don’t have any difficulty telling a giraffe and a zebra apart – a zebra is like a horse with black and white stripes, a giraffe is a creamy yellow with brown spots… oh yes and it has a very long neck and very long legs.

A giraffe shouldn’t have any trouble standing out from the crowd of zebras.

But this one does.

Take another look. It seems to be hiding, putting itself in the background and making itself look small.

That can happen with a business and its marketing too.

You can have genuine differences that existing customers recognise and value. They can be the reasons why repeat customers keep coming back to buy again and again (what I call order winners).

But what if your marketing doesn’t recognise these vital factors and explain them to the other people you want as customers?

What if you don’t recognise what it is that does make your business unique and special?

“It can’t happen” you might be thinking.

But it does.

We grow used to things and accept them as normal.

It’s just the way things are.

So you hide rather than shout about the things that will make your business stand out from the crowd.

It’s an important reason why it is so useful to work with someone from the outside who looks at things with fresh eyes and can be amazed by what you really do for your customers and how they benefit.

Just like you want your customers to be.

“Gun To Your Head” copywriting and marketing is a phrase that I first heard from the late, great Gary Halbert and the idea has also been promoted by John Carlton.

The concept is simple.

What would you do in your marketing if your life depended on making that particular advertisement, letter or website page sell [continue reading…]

Robert Cialdini, the acknowledged expert on influence, has created a doodle video to help explain the six factors of persuasion.

You may have already come across these ideas but the video is a great reminder because it puts the concepts across in such a powerful way.

Robert Cialdini Doodle Video

Do You Use These Six Factors Of Influence In Your Marketing & Selling?

It’s many years since Robert Cialdini first popularised these ideas but how well do you use them in your marketing?

My advice is to take a sheet of paper and draw a vertical line down the middle and head up one column with “do” and the other with “can do”.

Then work through the six factors – reciprocity, liking, authority, consistency, scarcity and consensus (social proof) – and look at how you currently use the ideas in your business and then, how you could use the concepts more.

I wrote a very popular article about the marketing mix:

Marketing Mix: 4 P’s or 7 P’s of Marketing or Extended Even More?

I then extended it to look at the different versions with widely different P’s. I’ve now decided to have separate articles for each of the different number of marketing P’s.

The original marketing mix that has become widely known is Product, Price, Promotion and Place.

The 7 P’s of Marketing

Version 1 (the marketing mix for service businesses)

• Price

• Place

• Product

• Promotion

• People

• Processes

• Physical evidence

I think this version makes a great deal of sense for service businesses.

As an example, think about a restaurant.

In terms of physical evidence, the building, the decoration of the room, the quality of the table and chairs, cutlery and glassware will all help to form an impression. So will the food itself – how it looks, smells and tastes.

Then there are the people. Front of house, the quality of waiter or waitress service can make a big difference. The chef may be particularly talented and even a celebrity.

Finally the processes are important because they make sure that service is consistent. You do want to go to a restaurant and have a great meal, decide to take friends and have it turn into a disaster because what was done so well before, has suddenly become a disaster.

Version 2

In this version of the 7 P’s of marketing, processes and physical evidence are replaced with positioning and packaging.

• Product

• Prices

• Promotion

• Place

• Packaging

• Positioning

• People

http://www.entrepreneur.com/marketing/article70824.html

Version 3

Here Place is dropped from the original marketing mix and Position is brought in. While Place usually refers to the distribution routes to market, position identifies how the business fits in with competitors. Otherwise it is very similar to the service marketing mix.

• Price

• Position

• Product

• Promotion

• People

• Processes

• Physical evidence

http://www.sabusinesshub.com/section/content.php?SectionId=7&SubsectionId=5&ContentId=529

What Do You Think About The 7 P’s Of Marketing?

Do you find any of these more helpful than the traditional marketing mix?

Leave a comment below.

The Other Versions Of The Marketing Mix

If you want to look at how the other versions have developed, here are the links.