Strategic Positioning

Let me be blunt. If you haven’t differentiated your business, is it because you are too scared to be different?

In a survey people said that there were more scared of public speaking than dying!

That’s a bit extreme but some people don’t want to be the centre of attention, all eyes on them, watching what they do and listening to what they say.

Or what about the nightmare of being invited to a fancy dress party, getting dressed up in your Superman costume and getting to the party and finding out that your hosts changed their minds and it has become a black tie do? Just thinking about it sends shudders down my spine.

It can be like that when you think about differentiating your business.

The entire point is that you are standing out, different… even exposed.

The big name gurus say that you must be differentiated to earn big profits.

You see the problems of not being differentiated in your own purchases each week. It is difficult to make a buying decision when all your options seem to be virtually the same along with the worry that you might make an arbitrary choice and it turns out badly.

Like me, you probably get frustrated when you can find plenty of people selling what you don’t want and no one selling what you do.

You may also see the problems of not being differentiated in your own business.

The symptoms are pretty common:

• You find it difficult to attract leads.
• Not enough of the leads you get convert into customers.
• You have far too many conversations about price and really feel the pressure to cut your prices.
• You find it difficult to say what’s special about your business.
• Your customers show little loyalty and are tempted away as soon as a better price is offered to them.
• Your best staff leave you and go and work for your competitors.

But there’s a feeling of safety about being one of the crowd.

You have a chance – even if it’s a small chance – of getting an order from anyone who enters the market because you haven’t made the tough decisions of ruling anyone out.

There’s a feeling of safety of doing what everyone else is doing.

• Your competitors have a website so you have a website.
• Your competitors advertise in Yellow Pages so you advertise in Yellow Pages.
• Your competitors advertise in the local newspapers so you advertise in the local newspapers.
• Your competitors add the special widget to their product so you add the special widget to your product.

There’s a glimmer of sense and a lot of madness in this approach.

It is sensible to look at your competitors and see what seems to be working well and to work around the theme.

If a lot of business is done through the Internet, then you should probably have a website if you can make it special.

But the world doesn’t need a lot of clones in any market.

We don’t need Microsoft 2 because we’ve got Microsoft.

Or Google 2 because we’ve got Google.

Or Apple 2 because we’ve got Apple.

Or Starbucks 2 because we’ve got Starbucks.

Or Aston Martin 2 because we’ve got Aston Martin.

The world doesn’t even want another Paul Simister and there’s not much of me to go around. Crazy I know but that’s life.

But we do want variations on a theme.

A PC operating system that doesn’t crash so often or slow the processor down.

A place to have afternoon tea with the emphasis on the quality of the tea.

A fancy car that James Bond will drive and I can afford to buy without cashing in my life savings and selling the house.

Clone businesses survive because the cloned business is too busy or too expensive (mmm supply, demand and prices are linked – that’s interesting).

But what happens when the market dips down, like in these tough times, the business that is being copied still attracts plenty of clients because they are still first choice. The copies lose business and being near the bottom in a declining market is a very vulnerable place to be.

Perhaps you shouldn’t be too scared to differentiate but too scared not to differentiate.

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 believe every business needs to have some way to differentiate itself from competitors who are equally eager to snare business from customers.

Your task is to communicate the factors that differentiate your business and its products quickly and effectively so your customers understand and appreciate why they should buy from you.

First list down all your features about your product or service.

Second, link them to benefits for your customers. You need to translate your features into things that your customers want. It can be useful to use the FAB model – Features, Advantages & Benefits.

For example.

This PC has the super XYZ chip (feature) and is the fastest PC on the market (advantage) and tests show it will save the average Windows user 20 minutes per day (benefit).

Super techie people will know all about the XYZ chip and go looking for the feature when they want to buy, others will want the advantage (the fastest) whilst others will be eager to save so much time – 20 minutes per day is nearly a day each month.

Third, I want you to plot your features/advantages/benefit combinations on a 2 x 2 matrix. One side is about the uniqueness of the feature/benefit and the other side is the importance to the customer. [The brave can go one step further and ask their current and prospective customers to assess the features/benefits.]

You’re got four boxes to consider:

Unique & Important

Unique & Not Important

Standard & Important

Standard & Not Important

This can be a humbling experience as you realise that many of the reasons for buying that you promote in your marketing are generic benefits of your product or service which virtually every provider promises.

Even more alarming, you may realise that your claims for uniqueness are not important to the customer.

We can be so eager to find something unique that we don’t think whether it matters to the customer. We know that we need to be perceived as different.

Because I’m 6 foot 4 inches tall, I genuinely stand out in a crowd. It’s a silly example because my height has no bearing on my ability as a strategic business coach. However,  as a supermarket shelf stacker, it’s got value but a coaching client is more interested in my brain and my ability to communicate my ideas.

Even worse, we can be wasting our time talking about things that a customer takes for granted. I am staggered at the number of accountants who promote a “professional service”. It’s a disgrace if there are accountants don’t offer a professional service. This is what I call an order qualifier and is a minimum standard that is normally assumed unless there is evidence to the contrary.

The gold is in that first category – genuinely unique (or at least rare) and of significant value to customers. These are your order winners.

For me, this is my positioning as a coach who specialises in helping service and commodity product businesses to differentiate themselves.

It may be the accountant who specialises in green technology businesses and who has plenty of contacts with investors who want to provide funds for environmentally friendly start-ups.

It is these special and unique factors which really resonate with potential customers and need to be the focus for your marketing message.

You then supplement and extend your marketing messages with the standard items that are important to customers. Your customer may be specifically looking for solutions or assurance on these factors. Not mentioning them could mean you miss out, even though you know they are standard.

You should only drop to the unique but unimportant level if you don’t have any unique and important factors. They may lack impact, but they can help make you stand out.

And any positive reason to be memorable is better than nothing.

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.

Bullseye marketing is a powerful analogy for niche marketing and differentiating your business.

Imagine You Are A Buyer

I’d like you to put yourself in the shoes of a potential customer looking for what you sell.

You have some idea of what you want or need so you go out looking.

You see something but it doesn’t measure up – it’s in the outer ring of our buying bullseye target. You’d have to have a desperate and urgent need to make do with that product.

Then you see another offer.

It’s a bit better but it’s still not close enough to the centre to make you reach for your credit card.

And then you see another offer which has some things you want but not others or it has a deal-breaker – something you want to avoid so again you don’t buy.

As you look at options, you clarify your thoughts on what you really want – what represents a bullseye – because you learn about what’s available (including features, advantages and benefits you’d never thought of previously) and what you need and like.

Have You Found The Bullseye When Buying?

Sometimes you find what you’re looking for.

Sometimes you find something that’s good enough and you buy that because the extra value you get from a bullseye purchase isn’t enough to compensate you for the extra time and effort you need to hit the bullseye.

Other times you find a collection of products and services which are all stuck in the outer-rings. None are what you are looking for so you have to decide to:

• Seriously compromise what you want and buy the best of a bad bunch (often a short-cut to dissatisfaction and frustration);
  .
• Delay your purchase while you either keep looking or hope that the ideal product appears; or
  .
• Find another way to solve the underlying problem.

Me-too, generic products are often in the outer-rings of the buyers’ bullseye and that’s why they are vulnerable to a business who focuses on a particular niche.

Sure, the product will miss the target for many people but for some it will either hit the bullseye or the inner-ring and be a convincing “good enough” to persuade you that it makes sense to buy rather than delay.

Are You Using Bullseye Marketing In Your Business?

How is your marketing doing?

Is it attracting customers who are a natural fit for your business and what you offer? Does your product or service match their bullseye?

And are your identifying and emphasising what makes you a bullseye fit in your marketing in a way that is compelling? Does your marketing promote the few factors that make your product uniquely meet their needs?

Your marketing can fail if:

• You have the perfect product and in theory it hits the bullseye but your marketing doesn’t show that it’s perfect for your target customers.

• Your product doesn’t hit the bullseye of (m)any potential customers.

Solving the first is a marketing problem, solving the second is a product or process innovation problem. To use an analogy, you can put lipstick on a pig but it’s still a pig.

Bullseye Marketing Is A Powerful Analogy

The bullseye marketing target is a powerful analogy that helps to explain why some people buy and why some don’t.

Your task is to make sure that your offer reaches those who it will appeal to. You do that by targeting a niche and using bullseye marketing.

It was Elmer Wheeler who famously said “Sell the sizzle, not the steak.”

Elmer Wheeler is the author of the fascinating book “Tested Sentences That Sell” which shows how fragile the buyer’s mind is and how one way of something encourages a buying decision and a slight variation is rejected.

Although I respect what Elmer Wheeler has to say, I want you to sell the sizzle and the steak.

Unfortunately the meaning of the original “sell the sizzle not the steak” phrase has been corrupted in a way that is damaging both to businesses and to the discipline of marketing.

What Elmer Wheeler meant by the phrase is that you should emphasise the biggest selling point in your proposition – the main reason why customers will want to buy.

In some ways he was encouraging people to move from promoting features to selling benefits. I have no problem with the idea that customers buy for the positive experiences and consequences they expect from owning or using the product. (Just don’t forget the features because they add credibility to the benefit and can become a buying attribute in themselves – ever bought a PC mainly because it has the latest chip from Intel?)

Unfortunately, the idea behind “sell the sizzle, not the steak” has been corrupted.

Too often it is taken to mean hyping up an ordinary product so that it sounds exciting.

That approach creates a brief illusion which may tempt a prospect to buy but it leads to disappointment in the ownership and use stages.

The exciting sounding product turns out to be ordinary and no better than the competitive product that was ignored at half the price.

It’s no surprise that the buyer gets angry.

Angry with the company that tricked him into wasting money.

And agree with himself for allowing himself to be conned.

The company suffers because there’s not going to be any repeat business and with the high costs of winning a customer, that’s where the big money is made.

And the buyer suffers because he gets cynical about marketing and the claims made by other businesses.

But there’s a better way.

Instead of trying to make the ordinary sound exciting, you could make the ordinary become extraordinary.

This is a much better way of doing business and it’s something I’ve written about before as deep differentiation (making the steak special) and shallow differentiation (making the steak sound special) – see Deep Differentiation.

Too often I believe that business owners and managers are wrongly encouraged to spend their time and attention trying to make their marketing message sound good and communicating it in 101 different ways.

Instead the focus should be on the underlying offer.

You can put lipstick on a pig but underneath it is still a pig.

But it’s much better to stop selling pigs.

So focus on the steak – and make sure it’s good, juicy, tender and tasty.

It would be nice to think that you don’t have to worry about the sizzle.

Sometimes you don’t.

Word of mouth recommendations from one enthusiastic buyer to another can be enough.

But often it isn’t.

So you still need a clear marketing message but this time it’s delivering promises that you can keep because you have made the ordinary extraordinary.

The Irresistible Promise is step 2 of my six step profit formula.

The Irresistible Promise Is An Update On The USP

Once you’ve found your starving crowd, you need to make it an offer that is compelling.

Mark Joyner calls it an Irresistible Offer.

Theory of Constraints call it a Mafia Offer (an offer you can’t refuse.)

Rosser Reeves called it a unique selling point or unique selling proposition.

I call it your Irresistible Promise.

Why The Irresistible Promise Is So Important

Customers and consumers are becoming increasingly sceptical about marketing as it becomes more outrageous to attract their attention and the hype gets stronger to try to persuade people to buy.

Your marketing message has to connect at both an emotional and logical level to move past the purchase tipping point but you don’t have to resort to hype and unrealistic offers.

• Customers in your target market should find your offer so distinctive and so attractive that it is virtually irresistible (assuming they’ve got the money.) I call this bullseye marketing.

• The closer what you offer matches what your market wants, need as and sees as an urgent priority, the greater the probability of making the sale. If you sell a commodity product that is identical or virtually identical to every other competitor, then you’re trapped in the possibly sector along with all your other competitors. If you sell a differentiated product, then some will know that what you offer doesn’t fit but for others you will step away from the competitors and move towards the centre of the bullseye and increase the probability of the prospective customer buying.
  .
• You see your marketing as a firm commitment to deliver on consistently and reliably. The Irresistible Promise is not based on shallow differentiation of a hyped up marketing promise that doesn’t run through your business system or value chain. You’re selling the steak and the sizzle.

This is part of the P3M2 module from the Pillar 3 Your Strategic Market Positioning.

Review Your External Environment For Strategic Changes With PESTER Analysis

What Does PESTER Stand For?

• P = Political
• E = Economic
• S = Social & Cultural
• T = Technological
• E = Ecological
• R = Regulations

It is also known as PEST, PESTLE, STEP, STEEP and probably a few other acronyms. The best known is probably PEST but I find the extra ER useful to make sure there is a more comprehensive review. [continue reading…]