One of the biggest problems we all have in small business is standing out. Almost everyone has competitors of some description. It could be the person down the road that promises to undercut whatever price you offer. It could be the elephant in your marketplace- for example, if you are a small telco, the elephant is Telstra.
Or your competition could be a myriad of me-too suppliers in highly competitive marketplaces all driving the prices down to the point where no-one makes any money.
So how do you stand out from all this competition? You make sure your business is different in some way to all your competition, and you make sure potential customers who value that difference, and will pay more for it, know about it. The first step in differentiating your business from everyone else’s is to answer the question:
Why Should I Buy from You?
Can you answer this question? You must have an answer. If you don’t know, you customers certainly won’t, and you will find you are just competing on price and barely surviving.
The answers to the question: “Why should I Buy from You?” are your Points of Difference (POD). This is arguably the most important marketing strategy to get under your belt. In marketing speak it is also called your Unique Selling Proposition or USP. What this means is that you are defining why your product or service is different to everyone one of your competitors. When you have your USP, you actually have no competitors, because your offer is unique.
Great in theory, but just a word of warning. This also means that your product cannot be considered universal any more, and your USP will appeal to a more narrow group of customers, or a Niche.
So what does this mean in practice? You might be the cheapest. This will, of course, attract a lot more business, which will compensate for your lower margins. However, this will not appeal to everyone. Lowest cost, usually means no frills. Jetstar is a no-frills airline, but Qantas still has lots of passengers who want the extras, and are prepared to pay for it. So Qantas and Jetstar promote themselves to different audiences.
Maybe you said your Point of Difference was the quality of your service. I am now going to say something that may shock you:
Quality of service is not a good enough reason for people to buy from you.
Everyone says they have quality service. Have you ever heard anyone say: “Buy from me, my service is lousy?” Quality is a given, a pre-requisite today. Everyone says they offer a quality service. So what’s the answer? Surely ‘quality’ counts for something?
Regular subscribers to the Small Business Achiever - Business Owner Brief will already know who their competitors are. In Issue 101 – where this full article is published, subscribers learned how to create Points of Difference for their business.
In Issue 103 of the Small Business Achiever I explain how these points of difference can be used o the fundamentals of how to increase your prices with your Points of Difference can be used in your ads and on your website.
In Issue 103 of the Small Business Achiever - Business Owner Brief find out:
The Anatomy of Ads that Sell
Creating a Structure that will Drive Your Business Growth
Designing a Website that Generates Leads for Your Business
Get step-by-step advice that will improve your business every month.
May Your Business be as You Plan It!
Dr Greg Chapman
Over to You. What do You Think? Post Your Comments Below.
Dr Greg Chapman is the Director of Empower Business Solutions and The Australian Business Coaching Club and is Australia's Leading Advisor on Emerging Businesses and provides Coaching and Consulting advice to Australian Small Business Owners in Marketing & Business Strategies Planning & Systems. He is also the author of The Five Pillars of Guaranteed Business Success.
The Australian Small Business Blog