Posts Tagged ‘Sales Promotion’
Developing an effective Unique Selling Proposition (USP) is one of the key foundations of creating a competitive and successful business. Getting your USP right from the outset can make your marketing and sales activity a lot more effective. It also makes it easier for you to communicate a consistent message in a variety of different mediums.
The Wikipedia definition of a USP is: “The proposition must be one that the competition either cannot, or does not, offer. It must be unique—either a uniqueness of the brand or a claim not otherwise made in that particular field…” for example FedEx’s proposition is “When your package absolutely, positively has to get there overnight”.
Knowing your competitors, customers and your marketplace seems like an obvious requirement. However not many small businesses really invest enough time into understanding the comparative market position of their products and services. The likely outcome of such low awareness is the development of “me too” type products and services that look alike. Therefore the business is forced to compete on pricing rather than well developed customer benefits.
How do you identify your USP?
Start by reviewing your businesses’ key strengths, weaknesses and overall market position. Look for all aspects of your product or service offer that makes your business unique or different. What is special about your offer and how will it benefit the customer? Ask yourself why the customer should buy from you and not your competitor.
An example of defining a Hotel’s benefits:
Location is always a big factor in market positioning in this type of business. The hotel in question has old world charm and is considered boutique accommodation. There are a small number of uniquely decorated rooms and the overall atmosphere is eclectic.
The Hotel owner looks at the business and deduces that the key benefits for the customer are:
1. Proximity to the waterfront with a picturesque outlook
2. Boutique features with a unique atmosphere – the hotel has a real personality
3. Like no other hotel – ideal for people who want to experience something different.
In the process of defining your USP you will also need to consider the wider market context within which you operate. If we take the example of running a railways business, this could be widened to the context of transport. The change in perception will fundamentally shift the way you look at what you offer the market. The U.S. rail industry failed to make this readjustment last century and suffered from a market shift that left them almost obsolete.
For example a traditional USP for a mail business is:
“Auckland Mail Services provides a fast and efficient mail delivery service. We guarantee to deliver your mail the very next day”
Let’s change the perception of the business to “facilitating the movement of information between people and businesses”, so that AMS is in the business of information transfer. They could use the following statement as a basis for developing their USP:
“Auckland Information Services makes the transfer of information easy. Every hour of the day your friends, family and businesses are connected together.”
The ability to future proof your USP is a definite advantage. There is however a balance between defining your market too narrowly and too broadly. You still need to be able to keep your positioning relevant to your target customer. The time you invest in this process is vital for your business as it will provide key market insights into your competitive advantages and can also provide a proof of concept for your customer offer.
In part 1 of this blog we look at the benefits of developing a competitive USP.
How to develop a competitive USP
Step 1a) Review business processes and key product and service attributes
This process is best done with the help of someone external to the business that can provide objective feedback. As a business owner or manager you can become so immersed in the business that it is often difficult to remove emotive opinions and you may suffer from blinkered perception.
Remember that you are trying to see your business offer from the customer’s point of view. What are the benefits they will receive from your company? What is in it for them – why should they care?
Not all businesses start with the customer in mind. Manufacturing based businesses can be very focused on the innovation and product development process. They can develop a new product because of a technology or process breakthrough rather than a direct customer requirement. The marketing and sales function is then tasked with trying to tease out the benefits and figure out how to sell the new offer.
Once you have defined the key benefits of your product or service offer then you can start to compare them with your competitors.
Step 1b) Review competitor businesses
Use the internet to review your competitors and other comparable businesses. Look for information about how the companies position themselves and how they promote their key benefits. How do they talk about their businesses? Look at things like tone of voice and writing style. What products and services are offered and what are their specialism’s?
Throughout the competitor review process you are focusing on two things; A) you are trying to understand the specific details of each individual competing business; B) you are trying to map out the industry or sector that you operate in and where your business is positioned relatively. These two pieces of information will help you determine what you need to say about your business to be different and how much competition you really have.
The business landscape is always changing, so the snapshot you are creating can become obsolete overnight. It pays to review your market at least once a year to see how it is developing. In technically fast moving markets you may have to build a continuous review process into your business to try and predict change and keep your business competitive.
Step 2) Outline clear competitive advantages
Once you have completed comprehensive competitor research and understand the comparative key benefits of your businesses’ product or service offer this stage should be relatively easy. Start creating a list of key aspects about your business that deliver customer benefits which are unique to you, which will establish you as a preferential supplier. This list of benefits will then become the foundation of your USP statement.
Step 3) Develop initial USP statement
You can begin to capture these on paper once you are confident you understand the unique elements of your business. A consideration when developing your USP is the application or when/where it will be used. You will often be required to list your business in directories or supplier lists, so having a great USP that is 30 to 40 words is very useful. The USP can be developed from a core version into several different length variations for when you have greater space to describe your business. Be mindful that you do not want to dilute the core powerful message of your statement by stretching it out too much.
When creating your USP statement you need to define the benefit statement in terms of the customer. Remember it is about your customer not your business – Use “you” and not “I” or “we”.
At Big Ed’s shoes we provide the biggest range of shoes in the southern hemisphere.
At Big Ed’s I know you will go crazy over the greatest range of shoes in Australasia.
At Big Ed’s you will find the biggest range of shoes in Australasia.
Following your initial analysis you could find that your offer is not unique or is at risk of being duplicated. At this point you may wish to go back to the drawing board to think about how to create new benefits or make your offer different. If your business model involves a discounting strategy or a volume based strategy, then differentiation may not be such a big issue as long as you can maintain your market
Step 4) Review and amend
You can now compare your new USP against other competitor’s statements to see how it stands up. It is a good idea to get a range of opinions on your new draft USP. Try to get some neutral opinions as well as those from friendly customers and key staff. Ask them if this statement represents what your business offers its customers and does it capture all the key benefits you offer.
When creating a future orientated positioning statement which portrays your business as you would like to see it in the future, there may well be a shortfall in how people currently perceive the business. This practical difference in perception can be used to help define the actions required to close the gap between your future positioning and the current position.
Step 5) Finalise USP and positioning
Refine your statement and when you have finished pat yourself on the back as you have achieved what many small businesses struggle to do.
As a result of this process you will have:
1. Greater awareness of your market place
2. More knowledge of who your competitors are
3. Greater understanding of
-Your strengths and weaknesses
-What makes your business different
-Your key marketing and sales messages
4. Greater consistency in your marketing and sales communications
You will now need to start to planning your promotional activity and set your marketing plans for the coming year.
For further support in developing your USP or to develop an effective marketing programme contact us.
Why should marketing be a key consideration for your business now? In the current economic climate it can be easy to justify holding the marketing purse strings tighter. However a downturn can be a great opportunity to give your competitors the slip and establish your business dominance for the future.
During a downturn customer retention is as critical as prospecting. Customers can be more sensitive to price promotions and may leave their existing brands for perceived value provided by a competing company, whether it is based on price or perceived features. Reassuring your customers of the value they receive from your company can be key to retaining your existing business.
In growth periods every company is likely to be advertising and promoting their products and services heavily. This increased spending leads to promotional saturation which can make it much harder and more expensive for you to obtain promotional cut through and impact. Therefore while others are currently holding back, promoting your business now is an easy way to obtain a competitive advantage.
Remember customers haven’t disappeared altogether. They may be buying differently but they are still there. Companies that continue to promote themselves are much more likely to remain in the customer’s consciousness and are best placed to offer their products and services in the future.
Find out how we can add value to your marketing efforts – see our website.
Bridging the divide can deliver a range of benefits, potentially leading to innovation in business practices. Greater access to customer insights and an engaged sales force are just a two reasons for marketing and sales to work closely together (view the preceding blog).
Bringing each business function closer together requires us to consider the following aspects of sales promotion:
The ability to translate a marketing campaign into sales actions and targets is the key to success. Taking the big idea or concept and transforming the message for sales to utilise with their customers is essential. It is also important to involve your key stake holders early in the campaign development process.
Development often begins with:
• Effective stake holder management and internal communication
• Obtaining senior sales buy-in to your promotion
• Negotiating budget support for your marketing programme
When managing the translation of top-line corporate campaigns into your market segment it is important to:
• Build sales collateral resourcing and planning into the bigger campaign picture
• Allow for lead times in access to top-line creative outputs when transforming messaging into sales communications
Remember that the Brand and Campaign teams can overlook tactical sales collateral as they are busy fighting fires and making sure marketing agencies deliver on creative promises.
The sales launch
Get the sales force behind your marketing plans and interested in your campaign activity. Utilise their eagerness to know what marketing support they can expect from you to help achieve their targets and remember:
• Attention spans over the launch day can be worn-down by the overwhelming weight of information.
• Create PowerPoint cut through and viewer retention at a launch
In a large business there are often several marketing campaigns or promotions being deployed during the same calendar period so you need to:
• Keep your presentation punchy
• Provide appropriate support and sales collateral that can be used with customers
• Push their buttons and help them translate or apply campaign ideas to their customer’s situations
When developing sales collateral and support materials the opportunity to bring the sales force into the design loop will have many benefits. Their buy-in and input into a project will give you greater certainty of market application and effectiveness. To develop effective support material you should consider:
• Riding shot gun with a sales person to gain an understanding of their personal selling situation
• Allowing sales to see that you are genuinely interested in their success
• Creating user-centric sales collateral that is developed to fit the selling conditions
• Gaining early political support
Generating empathy for each others issues is a great starting point. Put your traditional prejudices aside as after-all everyone is in the same boat. With sales behind your marketing programme from the outset you can benefit. The sales team can be a great advocate for your efforts and provide amazing customer insights to further improve your campaigns.
Quality not quantity
It is amazing how many organisations are poor at launching promotions into the sales function and providing adequate support. Some companies seem not to have the time or budget to do it effectively. In some cases the marketing calendar is just too full, allowing marketing to use volume as a measure of success. It takes confidence to be able to stand your ground and fight the case that less is more.
Finally remember that it doesn’t matter how good the creative idea is and how well the concept has been developed, you must be able to deliver the message the final campaign mile and overcome the last sales hurdle.
We will help you deliver a successful sales campaign that gets results. – see our website.
The sales and marketing divide is often blamed for poor campaign performance and missed revenue targets. The inability of the two business functions to see eye to eye and work collaboratively can be a paralysing factor for any company. There are many external and internal factors that have an impact on a company’s culture and business practices. Identifying key issues at the source of the problem can be a difficult exercise. By rationalising these issues into two main concepts; perspective and process we can hopefully start to uncover some insights.
An age old mistrust of the marketing function combined with internal political constraints can lead sales to believe that marketing does not always have their best interest at heart. Sales often view marketing expenditure as a waste of hard earned revenue, which is ineffective at supporting the individual salesperson. While marketing’s perception is that sales does not always see the big picture or understand the issues of resourcing and multiple commitments.
Marketing’s business view can be conditioned by high level reporting and a focus on the big picture. Their perspective is often shaped by market segmentation and how the markets are split operationally. It can be very difficult for marketing to get reporting at an individual customer level especially in very large markets. While marketing is looking at the big picture the sales view is an individual’s perspective. They have a personal relationship with the customer and may have a “what’s in it for me” attitude to your promotional activity.
Sales can often feel unsupported as a result of poorly integrated marketing campaigns. Top-line branding or promotional activity is not always translated effectively into sales collateral. I have seen this in a number of cases within the corporate campaign delivery process. Sales collateral doesn’t win shiny awards, can be a low billable project and is often a low priority on a big agency’s list. When the budget is running dry there is generally little left for menial things like sales collateral.
Even though it is possible for a promotional campaign to be aimed at the level of an individual sales person (I have delivered one myself in the past), it is a very unlikely scenario. As a rule a campaign of this nature requires a supporting revenue model to warrant it.
As much as reporting shapes your operational view, measurement can shape your actions. Sales and marketing aren’t necessarily aiming for the same business targets and therefore can have very different agendas. Sales are focused on their individual revenue numbers and growth of their individual accounts. Sales people are keenly aware of whether they are on target to meet budget numbers and are sometimes less concerned with the collective results.
Marketing’s focus is on the collective results of a campaign and they are often looking at combined sales results or market trends. After campaign execution they may have even moved straight on to the next campaign, trying to plan for the coming calendar and are preoccupied with short lead times. Some marketing departments can be measured on through-put and have such a full yearly promotional plan that there is literally no time to review the current or previous activity. It’s a case of quantity not quality.
Bridging the divide
So how can we overcome some of the issues of differing perspectives and business processes that help to polarise the sales and marketing view?
To bridge the divide see the following blog.
NB. My comments are made from the context of the individual sales person. Even though sales managers and senior sales staff have a market overview it’s still the individual sales person who has the customer interaction and ultimately decides how to apply promotional concepts.
Find out how we can add value to your marketing efforts – check out our website.