Boost Business – Creating your USP / boostbusiness.co.nz

Differentiateor Die

Survival in our era of Killer Competition

IT’S HARD TO BE A CONSUMER...

• Everything is becoming more and more alike• Conflicting claims litter the market• Pushing tiny points of difference• Competition is clouding our minds• And choice is spreading

PICK ME

WHY IS CHOICE SO HARD?

• How do you determine what is best for you?

Especially if you haven’t tried it before?

- Your own experience

- WOM recommendation

- Impulse or gut feel

- Price

- Product/Service attribute

THE IMPORTANCE OF BEING DIFFERENT• Choosing is always based on differences• These can be implicit or explicit• These can be emotional or logical• They give the consumer a reason to choose you

• Remember, a decision must still be made

So you need to differentiate yourself from others

THE IMPORTANCE OF BEING DIFFERENT

• How can I stand out from my competitors?• What is different about me?• What can I offer they cannot?• Nothing is a commodity

Ask yourself...

DIFFERENTIATING COMMODITIES

1. Identify - Chiquita Bananas, Intel

2. Personify - Michael Hill, Mike Pero

3. New generic - Xerox, Lilo

4. Change the name - Chinese Gooseberry

5. Reposition the category - Red Meat, Bank Direct

“STANDARD” DIFFERENTIATING IDEAS

• Quality

• Customer Service

• Creativity

• Price

• Breadth of Range

All look appealing, but they will rarely differentiate you.

WHAT ABOUT QUALITY?

• 1990 was the war on quality• TQM and others were the catch cry• Everybody got serious about quality• Today quality improvements are everywhere

The Bottom Line:

Quality is now a given, not a difference

WHAT ABOUT SERVICE?

• Most companies are geared up for good service• But consumers are never satisfied• They always demand more• And they compare us across industries!

The Bottom Line:

Excellent service just keeps you in the game - it’s a necessity not a difference

WHAT ABOUT CREATIVITY?

• We’ve become very creative• Consumers find it hard to tell what we are selling• Consumers base their decisions on information• But they need it from their perspective

The Bottom Line:

Don’t bury your information in puffery and vagueness

WHAT ABOUT PRICE?

• Price is often the main enemy• Being price driven actually undermines

perception of being unique• Price only works if you can maintain it over time

The Bottom Line:

If you live by price, you can die by price

COMBATING PRICE ATTACKS

• Do something special - Telecom $10 text

• Cause confusion - Telecom/Power Co’s

• Shift the argument - Price vs longevity

• Run a promotion - short term obscuring

PRE-SALE

SALE

WHAT ABOUT BREADTH OF RANGE?

• Can be cost prohibitive for SME’s• Too big is now becoming a problem• Cannot stop your competitor using the same

strategy• Especially on-line!

The Bottom Line:

B of R is nowhere near as strong as leadership, preference or product difference

STEPS TODIFFERENTIATION

DIFFERENTIATION TAKES PLACE IN THE MIND

• Minds cannot cope; we’re on overload

• Minds are unlimited; perceptions are selective

• Minds hate confusion; simplicity rules

• Minds are insecure; we follow each other

• Minds don’t change; often futile trying

• Minds can lose focus; we don’t move with you

Two heads

IT ALL STARTS WITH LOGIC

• Step 1: Make sense in the context

- Arguments are never made in a vacuum

- You message has to make sense in your

category (including your competitors arguments)

- What perceptions do the consumers have

- Is your timing right

IT ALL STARTS WITH LOGIC

• Step 2: Find the differentiating idea

- What separates you from your competitors

- Remember, it doesn’t have to be product or

service related

- Use the difference to set up a benefit for your

customer

IT ALL STARTS WITH LOGIC

• Step 3: Have the credentials

- You must be able to support your differentiating

idea, making it real and believable

- No smoke and mirrors, the consumers are a

skeptical bunch

- You are in the Court of Public Opinion!

IT ALL STARTS WITH LOGIC

• Step 4: Communicate your difference

- Don’t keep it to your self, tell people!

- Better perception wins, not better products

- Give people something to latch onto, to believe in, to run

with

- NZ has a real problem with this!

**SEE MarketBOOST Step Number 2 - Incorporation

STEPS TO DIFFERENTIATION

•Being first

•Attribute ownership

•Leadership

•Heritage

•Market specialty

•Preference

•How a product is made

•Being the latest

•Hotness

BEING FIRST IS GOOD

• Being first provides tremendous advantage• First normally stays first• Can be used to create generic advantage• First is normally based on a great idea• There are many different types of ‘First’• But, sometimes….

EXAMPLES OF BEING ‘FIRST’

• Healthy First• First in the Category• Do Good First• Borrowed First

Being “First” often means just finding an idea and launching it in NZ

Being “First” often means just finding an idea and launching it in NZ

ATTRIBUTE OWNERSHIP IS GOOD

• Attribute is a characteristic, peculiarity or distinctive feature

• Become known for that attribute• Cannot be the same as competitors• Focus is the key to success

ATTRIBUTES OF CARS

BMW Driving

Volvo Safety

Mercedes Engineering

Jaguar Styling

Toyota/Honda Reliability

Ferrari Speed

Holden ????????

LEADERSHIP IS GOOD

• Most powerful way to differentiate yourself• Tell us and we believe you!• Can provide ownership of a category• Leadership is a platform• And don’t be afraid to brag!

FORMS OF LEADERSHIP

• Sales Leadership

• Technology Leadership

• Performance Leadership

• Knowledge Leadership

• Community Leadership

HERITAGE IS A WINNER

• Has the power to make your product or service standout from the competition

• Consumers normally feel secure with longevity

• You can bring your heritage forward

• Or, turn back to your heritage

• Excellent competitive weapon

MARKET SPECIALTY IS GOOD

• Specialists are perceived as experts

• As a specialist you have powerful weapons

• The ultimate is to become the generic in the category

• But, beware of too many specialists

TRUST ME, I’M AN

EXPERT

PREFERENCE IS A WINNER

• People follow the herd

• The principle of “social proof”

• Reduces the consumers risk factors

• If you’ve got it, flaunt it!

• But make sure your claims

stand up to scrutiny

WHAT ABOUT HOW IT IS MADE

• Consider how the product or service has been put together

• Can be the magic ingredient

• Dramatise the difference

• Are you making it the right way

DIFFERENT TYPES OF “MADE”

• Made Differently

• Made the Old-Fashioned Way

• Handmade

• Made Better

IS IT THE VERY LATEST?

• Being “new” is a great differentiator

• Psychology is obvious; nobody wants an obsolete product or service

• Re-invent yourself

• Break with the past

IS IT HOT

• When you’re hot everybody knows

• Use “hotness” ideas from outside your category

• Don’t be afraid to boast

• Cannot be “hot” forever, so be prepared

SOME WAYS TO BE “HOT”

• Sales

• Staff

• Knowledge

• Industrial ratings

• Industrial experts

• Public ratings

ONCE YOU’VE GOT IT - HOW DO YOU KEEP IT?

GROWTH CAN WREAK IT

• Main cause of loss of uniqueness

• Problem No1 - distraction

• Problem No2 - line extensions

• Growth can, of course, occur.

You just to ensure that brands complement rather than compete

IT OFTEN REQUIRES SACRIFICE

• Giving up something can be good for your business

• Stick to your core business

• The more you add the more you risk undermining your basic differentiating idea

• When you chase another target segment, chances are you’ll neglect your existing customers

MAINTAINING YOUR DIFFERENCE

• Remember your difference

• Once contrary, stay contrary

• Be consistent

• Evolve your difference

• Don’t tinker!

• Don’t just sit there

WHO’S IN CHARGE OF DIFFERENTIATION?

• YOU ARE

• Don’t assume other people understand your strategy

• Don’t leave maintaining your differences to “someone else”

“The foundation of effective leadership is thinking through the organisation’s difference, defining it and establishing it,

clearly and visibly.”Jack Trout, 2004