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Selling Brand Value

Does it feel like your brand is a "commodity" in a sea of competition?  
 
Your brand is the mental and emotional "real estate" held in the minds and hearts of your customers.  Communicating your TOTAL BRAND VALUE vs. PRICE to current and potential customers drastically improves your ability to compete in a saturated market place on price alone.  When your firm’s brand and its products and services are completely differentiated from the competition, your odds for success are exponentially increased. Research suggests that those brands that engage people emotionally and that differentiate themselves command prices 20% to 200% higher than competitors’ and sell in far higher volume.  This class will focus on selling the value of the firms total brand solution vs. competing on price to win and keep new business!

COURSE OBJECTIVES

·      Recognize and build value into commoditized products and services that typically sell on price.

·      Identify the 6 elements of a successful brand.

·      Build both passion and respect for your firm and its products and services.

·      Understand why companies that are differentiated or are “purple cows” are winners.

·      “UN-COMMODIFY” and differentiate your firm, its products and services from the competition.

·      Effectively communicate total brand value vs. price in the selling process.

·      Understand and communicate your firm’s brand story in the market place.

·      Define new target markets for your firm’s products, services and its total brand value.

2.   COMMODITIES:  SELLING BRAND VALUE VS. PRICE

No matter how fantastic a sales person you are, no matter how much training you have had, no matter who you work for or what you are attempting to market or sell, there is one thing that cannot be changed:  Across all business segments today, and within each of those business segments, both products and services are available in an ever widening array of choice. 

Consumers can “have it their way” today and they are!   A customer can customize a hamburger, an ipod, a car, a computer, and a non-fat-mocha latte brewed at 110 degrees!

Customers are wide eyed for new choices and opportunities in the marketplace.  They are savvier than ever, and have the resources necessary to find what they are looking for easily. The internet has increased the consumer’s ability to source from around the globe in a matter of seconds.

But this is not all!  It gets worse, much worse.  There is a rarely thought about but very important phenomenon that has grown to epidemic proportions today in our society.  Noted psychologist and author, Jon Kabat-Zinn, in his book, Coming to Our Senses, states, “our society suffers from what we can call a consistent and a constant state of partial attention.”  

Ask yourself this question:  If you are on the beach and you are talking on your cell phone, are you really fully and completely at the beach?  If a consumer is at the mall in a store shopping, but is on the cell phone at the same time, is he really present and at the store? The implications of this are immense as we try to garner the wandering eyes and minds of the consumer and direct it to what we have to sell them.   One thing is for sure, whether or not you are guilty of this state of partial attention is irrelevant, what matters is that you recognize that it exists in society and in your world of selling your wares.  Dealing with it is the challenge.  Or you, your products and services and your company will wither on the proverbial vine of consumer choice and attention deficit disorder. 

Recently a highly noted creative director from GSD&M Advertising, who handles the likes of Southwest Airlines, Wal-Mart and others, made an important observation. The criteria for measuring effective creative advertising these days have changed.  In the new world, a message on a billboard on the side of the freeway must be able to immediately and completely convey an intended message to be effective, otherwise, it is useless.

What this should immediately spell out for you as a salesperson or an executive tasked with marketing your products and services is:  DANGER. 

A state of constant partial attention, combined with a plethora of choice in both products, services and from whom they are consumed, means that your chances of being noticed in an ever deepening “sea of competition” are not only slim, they will continue to get slimmer in the future!  So no matter what you are selling, gaining and keeping customers will become significantly more challenging in the years to come.

COMMODITIZED: PRODUCTS, SERVICES AND FIRMS

No matter how good you are on the street selling or in the office managing and marketing, you will continue to have increasingly diminished chances of success in the marketplace because of the above factors of vast consumer choice and continual and constant partial attention marketing yourself and your goods.  This is especially true for products and services that typically are sold mainly on price, with no thought GIVEN to OTHER qualities that YOU and the BRAND contribute to the transaction.  Think of things like airline tickets, oil, building materials, paint, bottled water, electricity, peanut butter and many others.

COMMODITZED –it-

OFFER THAT NO OTHER CUSTOMER CHOICE IN THE MARKETPLACE POSSIBLY CAN!!

So, is it that we are doomed to competing on price alone and diminishing sales and margins if we sell highly commoditized products and services?   The answer is YES---IF---we don’t understand one simple fact.  Just about every firm selling a heavily commoditized product or service has something very real, unique and critical to brag about.   There is a very special and real story to tell about a problem your product or service solves that is crucial.   Where the sales consultants fall short, is: they are not given a thorough understanding of the total brand value the firm delivers in the marketplace.  Therefore, they cannot effectively compete on anything other than price.

Even gas!  Let’s explore.

Based on studies conducted by the American Marketing Association, the CMO Council, and Booz Allen Hamilton:

Only 10-20% of salespeople communicate deliverables that are both compelling to their customers and consistent with their corporate brand.

BrandMark’s

How to measure both PASSION and RESPECT for your firm and its products and services.

Research suggests that those brands that engage people emotionally and that differentiate themselves command prices 20% to 200% higher than competitors’ and sell in far higher volume. Want to be as sticky to your customer as Nordstrom’s, Starbucks or Target? The world’s most successful brands evoke an emotional response from the customer.  BrandMark’s is an extremely effective tool for analyzing where your firm rates on a scale of both PASSION AND RESPECT.  PASSION?  You bet!   

BrandMarks Matrix

Look at each firm’s scores in both categories of RESPECT and PASSION.  Plot the firms RESPECT score below on the HORIZONTAL line.  Plot the firms PASSION score below on the VERTICLE line.

Now look back at your responses above and see if you notice any patterns emerging.  Those firms that evoke a strong, positive and sustained emotional response from the consumer are simply NOT left to compete on price alone!

Typically, companies will rank higher on the respect scale than on the passion scale.   We know how to run the business side of the business but have failed to recognize the emotional attachment that consumers inevitably develop or don’t develop and hold for our products and services.   It is the MENTAL or RESPECT side that we address, and the EMOTIONAL and PASSIONATE side that we forget.

RULE OF EMOTION:

Humans are emotionally driven and directed beings and will pay more and purchase more from those firms and individuals that hold:

“MENTAL AND EMOTIONAL REAL ESTATE”

in the minds and hearts of their customers.

PURPLE COWS!

Identifying areas that the firm acts like a purple cow.  Remarkable companies, create remarkable products that people seek out.

Many years ago things in the marketplace were different.  The next time you go to the grocery store, walk over to the section where they sell peanut butter.  How many brands do you see?  10? 20? More?  This was not always the case.  At one time there were several brands available that held almost all the market share.   The frozen pizza market is another great example.  The first successful company to do things differently in a completely saturated marketplace was Tombstone.  With a combination of great marketing, differentiated product design and distribution, Tombstone truly moved market share.  How would you like to compete in the frozen pizza category today?  The variety of choice is incredible.  Things certainly have changed.  And, not for the better for those of us trying to gain the attention of an over stimulated consumer.

Let’s talk about Purple Cows.  A Purple Cow the term that author Seth Godin uses to describe a company or organization that stands out from the crowd or the herd if you will.  These are companies that are remarkable because what they do is recognizably different from the rest of the pack and they do it in a consistent and intentional way.

There are two types of business models that developed over the years to respond to the marketplace:

OLD    Create, good, safe, ordinary products and combine them with great marketing

to sell them.

NEW   Create absolutely remarkable products that stand out from the herd and that buyers seek out!

PURPLE COW = NEW BUSINESS MODEL

List below some examples of companies you consider Purple Cows:

So here is the rule of thumb:  Never be in the middle.  Cause the middle stinks.  It is unnoticeable and indistinguishable.  OUTLIERS WIN!  You must be one extreme or the other to get noticed.

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1.  Its hard if not impossible to be first anymore

Most product and service categories are flooded with variety.  It is simply harder to innovate. 

2.  Most folks don’t want or can’t buy your offering.

People or customers are either already happy with what they are buying or they can’t buy what your selling.  The reasons for this may include their purchasing capacity, price range, internal politics or that your product or service simply does not meet their purchasing criteria.

3. The competition is likely to boost advertising or marketing efforts immediately to keep you out.  Companies are serious about maintaining their market share and will fight vigorously to keep your products and services far away from the eyes of the customer.

Even though fitting in is failure in a crowded marketplace, this is what we most commonly due because it FEELS safe!  Firms copy the business models of their competitors and expect the same results to follow.  This approach rarely works.  If a high rate of success using this method could be ensured, then you would see many successful airlines flying the sky’s today instead of bankrupt ones.  This is so as many carriers decided on a low cost structure after experiencing marketplace difficulties.  Southwest Airlines business model was a well documented success and many competitors tried to emulate it.  The thing that was lost in translation is the fact that Southwest has a fleet, operation and cost structure that can support its proprietary low cost business model.  Again, it bears repeating.  NEVER be in the middle.  Outliers win.   

SIX (6) ELEMENTS OF A SUCCESSFUL BRAND

The elements that all successful brands must emulate to stay on top

Firms that “get it” have learned to address some very specific important areas that fulfill consumer needs.  Forget these areas for a day and you may get by.  Forget them for a month and you may begin to see some trouble.  Forget them altogether and you’re doomed!  Below we have identified and defined the Six elements of a successful brand.

Consistent- The firm and its products and services can be trusted to deliver on its promises over and over again (i.e. Starbucks coffee is always served piping hot).

Design/Lifestyle Oriented- The firm and its offering add to a consumer’s desire to live in a particular way or enhances their personal style (i.e. Harley-Davidson).

Recognizable- The product, service or firm is easily identified in a sea of competition (i.e. Apple).

Emotional Appeal- Thinking of the firm and its products and services evokes a strong emotional response from the customer (i.e. Ikea, Target).

Reflects Core Values- The firm has a founding story and a mission that is highly recognized and understood by its employees and is communicated to its customers.  Employees love coming to work (i.e. Southwest Airlines, Whole Foods)!

Relevant- The firms offerings fulfill a true need for today’s consumer (think of day care).

Based on studies conducted by the American Marketing Association, the CMO Council, and Booz Allen Hamilton:
 
• Salespeople are spending approximately 40% of their time preparing customer-facing deliverables while leveraging less than 50% of the materials created for them by marketing.

• Only 10-20% of salespeople create deliverables that are both compelling to their customers and consistent with their corporate brand.

• 85% of a company's external brand image is determined by direct interaction between the sales force and target buyers.   Not surprisingly, 85% of purchase decisions are influenced by this direct interaction.

Compelling Positioning

Brand positioning is about identifying your brand’s real value and competitive difference and communicating this information effectively to customers so that they buy your product/service.  It’s how you differentiate your brand in the mind of consumers.  Brand positioning communicates your brand’s benefits to customers.  It’s about perceptions, expectations and reputation.  It tells consumers what your brand/company is known for.  To be successful in developing a compelling position, you need a good understanding of your customers and your competition.

You need a compelling positioning, but very few of you have one. Could you take your positioning (i.e. what makes you unique and differentiated

in the marketplace) hand it to a competitor, and they could say all the same things?  Communicating sameness is a waste of time and money.   Let’s look at three common mistakes of brand positioning:

1.    Lack of Differentiation: Highlighting what may be true but what is not a key differentiation point (i.e. “you’ll like working with us”).  Differentiation defines the compelling reasons to buy.

2.    Lack of Focus: A generic marketing message to a generic target market.  Remember the old adage “jack of all trades master of none”.  Customers need to know what your unique solution is to their unique wants and needs.

3.    Not Customer-Driven:  Make sure that when communicating your solution to a problem, need and/or desire, it rings true from the customer’s point of view.  It should not be self-serving or gratuitous.

Positioning Exercise:  Create a Venn diagram for your brand’s position.  The point of intersection is where you should focus your positioning.  This overlap should be what your company/brand can do better than anyone else that meets a market need.  This exercise will help you to clarify and define your brand positioning.

Keep these questions in mind:

·      What does your brand stand for (i.e. who we are, how we want to be perceived)?

• Do you understand your brand's consumers (i.e. who are your targets, where are they, how do you reach them, what do they need to know to do business with you)?

• Do you understand what drives your brand's equity (specifically, what are your unique features, benefits and attributes)? 

• Can you match your unique points of difference with the needs of your target consumers?

• And, are these unique points of difference (from the consumer’s point of view)

a.    Beneficial and Authentic

b.    Compelling and consistently delivered

c.    Believable/Credible

When positioning, remember that brands that try to appeal to everyone end up appealing to no one.  FOCUS!  Pick one need that you can meet and meet it.  Brands can transcend their original products/services if they are positioned, not on the product/service (i.e. carbonated water, computers) but on a value, emotional attachment and/or lifestyle.  This allows flexibility to grow with your business as it evolves over the life of the brand.  Coke’s brand position is refreshment and fun times, not just cola.  Apple’s brand position is built around great innovation and beautiful design, not little black boxes or ipods.

CREATE AND USE TOTAL BRAND VALUE COMMUNICATION TOOLS

Defining critical brand differentiators and communicating them to customers.

It’s now time to communicate those specific differentiators to current and potential clients.  These again are NOT: on-time delivery, quality products and services, competitive pricing.  Why, because everyone in the marketplace is already making these claims and they are given’s today.  These are just the ANTE in the game these days!

Let’s define

Purple Cow again:

Purple Cows- Firms that create absolutely remarkable products that stand out from the herd and those buyers seek out!

Typically, a salesperson will toss out or dump product and service features and leave it to the customer to figure out:

1.        What the feature that they are talking about IS.

2.        What the feature DOES for me as a customer.

Example:    An elderly consumer goes out to purchase a new vehicle and the salesperson touts:

SALESPERSON:

“This new car has the new OnStar system installed with GPS.” 

CUSTOMER:

What is that and why do I need it?

Example:   A growing, medium size business is interested in adding computer server storage capacity, but saving on space:

SALESPERSON:

“We have some great new blade servers on the market that would be a super fit for you.”

CUSTOMER:

“Great, what the heck is a blade server?

It is imperative that a salesperson be able to communicate two things effectively:

1.    Brand Differentiator- A differentiator that fits one or more of the 6 elements of highly successful brands.

2.    Customer Result-The results a customer can expect to receive from the differentiator.

SELLING THE FIRMS STORY

Understanding the firm’s unique story, its emotional appeal and selling it to the customer

A business without a face will only serve to immerse you further in the deep sea of competition!   We live in an experience economy.  Firms are charged with creating an entirely memorable experience that customers wish to return to again and again. Your passion and purpose for being must be told to your customers and the world!

Firms spend the majority of marketing dollars to create and then offer elaborate brand promises.  These same firms don’t pay enough attention to delivering training that ensures these promises are translated into reality for the employees and ultimately for the customer.   A timely research project at Baylor University is investigating employee based branding effects on brand equity.  In a series of studies, Chris Pullig, Assistant Professor of Marketing, found that when employees find the brand they represent more attractive by understanding the firm’s story, they are ever more committed to deliver the brand’s promise.  This commitment is positively related to supervisor-related job performance and ultimate customer satisfaction.  This means that brand messages aimed at current and prospective employees may be equally important as the ones aimed at consumers in creating marketplace success.

BRANDSTORY communicates your passion and engages your customers emotionally via your own unique story, told in a creative, endearing and thought provoking way. Every successful business has a story!  That story and its appeal to the customer can make you all the more attractive to the customer as they begin to develop a personal affinity with your firm. Your brand’s internal and external image cohesiveness is a direct reflection of your ability to get your entire team to operate from the same playbook.  Shared passion, purpose, vision, and core values are the imperatives and without them your business success and brand are left to chance.   

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The Rise of Tribes and Cult Brands:

 (See Attachment:  A World Core Curriculum, by Doctor Robert Muller)

Never before in history has a human grouping been relegated to a particular product or service offering from a corporation.  Tribes are formed when human beings shift to identifying with a particular core value or values that a firm stands for in the marketplace.

1.    Brands are the new religion.

2.    Cults are a rich and legitimate source of insight for the creation of brand worship.

Focusing on the devotion that cults inspire in their members, Douglas Atkins, author of The Culting of Brands, outlines strategies for creating that same devotion in consumers through cult brands.  People today are anxious and confused.  Technology is accelerating at an alarming rate.  People are looking for grounding and a human touch.  There is a need today to create tribes that provide that grounding.  Brands are being sold on the hopes of fulfilling one’s dreams and life aspirations.  Cult brands satisfy emotional needs.  Marc Gobe` (Emotional Branding, 2001) believes that it is these emotional connections to brands that make a difference for consumers. 

Individual’s connections with brands transcend commerce.  A beyond-business relationship with consumers develops that creates a cult-like relationship with the brand.

For Atkins, the cult paradox can be identified in four steps:

1.    An individual may have a feeling of difference, even alienation from the surrounding world. 

2.    This leads to openness to, or searching for, a more compatible environment.

3.    They are likely to feel a sense of security or safety in a place where one’s difference from the outside world is seen as a virtue, not a handicap.

4.    This presents the circumstances for self-actualization within a group of like minded others who celebrate the individual for being himself.

We might feel uncomfortable or dissatisfied in an environment where our differences are not recognized and encouraged.  Being welcomed into a group where difference is validated and encouraged by people who are also different, but like ourselves, is a relief and even exciting.

Akins lays out the four D’s of difference, which are necessary to cult brand building.  They are as follows:

1.    Determine your brand’s sense of difference: (i.e. Apple’s Think Different campaign);

2.    Declare its Difference: (i.e. Harley-Davidson embraces this fact in its brand guidelines “Harley Truth #1- Harley is not for everyone”);

3.    Demarcate your brand from the Status Quo: (i.e. Ikea offering $4,000 in gift certificates at the opening of its Atlanta store);

4.    Demonize the others: (i.e. Nike demonizing “not doing it”, a fear for millions of fitness conscious consumers). 

Companies that are able to nurture strong ties with consumers and inspire a cult like following to their brands are adept at building communities around their brand.  These brands are intentionally different from the competition; create an attractive group identity, bound by a set of clearly defined values.

“The goal is to build a great company, one that stands for something, one that values the authenticity of its product, its people and those that buy from it.”  Howard Schultz, Chairman, Starbucks Coffee

NEW ERA OF CONSUMERISM

In Treasure Hunt: Inside the Mind of the New Consumer, Michael Silverstein points out that today’s consumers spend their money with great individuality, in an attempt to create customized lifestyles and standards of living that are uniquely their own.  Consuming, says Silverstein, has become a “treasure hunt” through the global marketplace of dynamic goods and services, with the goal of finding the perfect value every time.

At the same time, the world is filled with uncertainty; war, terror, technological change, global warming and more.  Because of this unpredictability and insecurity, consumers will continue to pay a premium for goods and services that reinforce a sense of place, connection, and stability.  Whether consumers are trading up, and paying premiums or trading down, looking to spend as little as possible, they demand emotional qualities in their goods and services as well as pleasurable experiences shopping for them. 

We have entered a new age of consumerism, where consumers are changing how they perceive and relate to brands, often forming larger communities around their favorite brands.  For these empowered and passionate consumers, their brands are a form of self-expression.

This new age of consumerism developed around the internet, as well as cultural and demographic shifts.  Companies that build relationships and an attractive sense of difference can create bonds beyond the point of sale, and reinforce those bonds through constant contact.  As Atkins points out, Apple has successfully created a strong community based on a certain way of thinking.  Apple brand members (not just consumers) define themselves by their different attitude to life, and they align that attitude with that of the Apple brand and others who buy it. This dynamic is at the heart of creating a strong commitment to a brand.  Cult brands are beliefs.  The Apple community is not even defined by the product itself anymore according to one student, Sean, who said, “In a literal sense, it’s based around this machine, but it’s based on a certain way of thinking.”

Apple Computer used great leaders like the Dalai Lama and Ghandi to persuade people that a Mac might also allow them to “Think Different.”  The 1984 ad began a branding campaign that portrayed Apple as a symbol of counterculture-rebellious, free-thinking and creative.  According to Charles Pillar, a columnist for the Los Angeles Times, this image was a calculated marketing ploy to sell computers that cost much more than competing brands. 

MASS CUSTOMIZATION and connectiON:

Many companies are using mass customization to connect their customers ever more strongly to their brands (think Netflix’s mass customization concept versus Blockbuster).  Briefly defined, mass customization is the ability to produce goods and services to meet individual customer need with mass production efficiency.  This, combined with the advent of the internet, is guaranteeing that customer relationship management (CRM) will never be the same.  Communication is no longer just corporation to customer, but customer to corporation and customer/member to customer/member.  Today, consumer outreach achieved via the internet goes beyond mere web page creation and allows for communication from the company directly to the consumer and vice versa in terms of blogs and member/fan sites.  If companies choose to nurture these sites with information and support, they can empower members and often gain a cult-like following.  What this means for companies is that they must listen to their customers and pay attention to member sites and blogs.  They must meet their customers and understand how they use the brand.  

The People are the brand

… The Product is the Experience

Cult brands embrace their members and employees as well.  Cult brands are adept at creating opportunities for customers to meet (real or virtual) and interact, as well as building customer intimacy/loyalty.  A company that exemplifies this better than most is Harley-Davidson.  What bonds Harley customers to the Harley brand, and to each other, is the passion to share in the Harley experience.  What helped Harley develop into a cult brand is the fact that what it sells is not just a product but rather a lifestyle.  And, Harley accomplished this loyalty while spending very little on advertising, but rather through member rallies and events.  The Harley lifestyle stands for freedom, individualism, excitement and a sense of "bad boy rebellion."   To quote Hilary Billings, a customer experience guru from Pottery Barn and the Red Envelope “With lifestyle brands, it's not just about serving another consumer need. It's about reaching a higher level in terms of the kind of connection you make with the consumer.”

Cult brands are expert at converting their best customers into influential, loyal, and enthusiastic evangelists.  “When customers are truly thrilled about their experience with your product or service, they can become outspoken evangelists for your company” say authors Ben McConnell and Jackie Huba in Creating Customer Evangelists, 2002.  Cult brands create an experience, involving the customer in a way that employs them. Consumers become passionate and empowered; they feel they can affect the brand in whatever way they want, even if it's negative. Apple learned this truth from some of their most loyal customers.  When the Neistat Brothers created a movie and website about the iPod's faulty battery they insisted that the protest was an act of love: "We made that film because we believe in the brand so much." (John: download at http://neistat.com/pages/movies.htm)

summary  

·      Cult brands create ways to enhance the consumer experience, and these experiences define the brand. 

·      They seize opportunities for consumers to reach out to like minded members and find ways for them to use the brand to express themselves (i.e. Saturn Homecoming Events).

·      Cult brands understand their customers and nurture loyalty with fun events (i.e. IKEA Grand Opening Events).

·      They invest in employee training programs and offer loyalty programs (i.e. Container Store).

·      They honor their brand’s promise to customers, and see it as an emotional conduit between their company and customers (i.e. Apple).

·      Cult brands engage consumers emotionally and build their relevance by understanding their lifestyles and passions (i.e. Harley-Davidson).

Not only is it important for companies to maintain the integrity and reputation of their brand, but, to maintain trust between themselves and consumers and be viewed as socially responsible throughout their business practices.  They are often involved in some type of corporate social responsibility program which is an extension of their values and brand promise.  For example, Starbucks which sells Fair Trade coffee to guarantee living wages to coffee growers; using paper cups made with 10% recycled materials; and, giving part-time “baristas” 401 (k) benefits.  Or IKEA, whose brand promise of creating a better lifestyle for consumers naturally extends to ensuring that its products are environmentally and social friendly (i.e. no endangered wood or child labor).  Remember when building emotional connections, quality consumer contact is critical whether it be from direct contact, consumer membership organizations and/or company-sponsored consumer events.

TARGET MARKETING – Put your money where your market is

The power of your brand relies on your insight into your target audience and their needs.  Target consumers are the market you need to reach, for whom your brand is always the primary choice. They are the buyers that are interested in what you have to offer, and most likely to embrace and use your product/service on an optimal basis.  This is why defining your target market will help to strengthen your brand’s effectiveness.  The knowledge that you gather about your target consumers and their needs should be the bedrock on which your brand is founded.

The combination of demographic and psychographic information can help you define your best customers and target market characteristics.

·      Demographics – based on measurable statistics, such as age, education, gender, or income;

• Psychographics - based on lifestyle, attitudes and values; such as a sense of freedom, security, or empowerment.

When you differentiate who your best customers are and who truly identifies with the brand value you are delivering … FOCUS ON THEM AND LEAVE THE REST BEHIND!  Find the group that’s the most profitable.  Find the group that identifies with you emotionally and is most likely to spread the word about your offering.  Develop and reward this group.  Ignore the rest because you can’t and don’t have time to focus on everyone.  Cater to those you choose.  Dominate that niche.

Know Your Best Customers

To gather information put together a questionnaire for customers, prospects, employees and suppliers to complete.  You should ask:

• Do you like our products/services?
• What are we doing right?
• What could we improve?

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Specialization The Key tO Attracting Customers

It’s hard to stand out in a crowd.  Many in an attempt to generate sales are tempted to be all things to all customers, but this is a flawed strategy. So what is the solution?  To thrive, your business must specialize in what you’re good at.  Specialization helps you define your “value added” benefits in the minds of consumers.  The advantage of specialization is that by focusing on what you do great, you simplify the marketing/sales process at the same time you simplify finding the solution for your customers.

According to David Baker and ReCourses[1], the key to attracting the best customers is to specialize in providing what they need.  Specialization relates to the clients and/or buyers you are seeking, not accepting.  You don’t have to fire any customers who don’t fit your target market; you just have to ensure that your corporate branding and communications strategies focus on this target market.  And, unless you actually declare this focus by putting it in your external/internal marketing programs it doesn’t count.  Your message must be apparent, obvious, simply stated and demonstrable.

3 Reasons to Specialize:

1.    Makes it easier to connect with your target market (you specialize in providing what they need);

2.    Makes it easier to set price based on the value of a product to the customer, versus pricing based on cost alone;

3.    Makes your positioning more compelling and sustainable (as you build experience delivering on points of difference that matter to customers you build loyalty and trust which reinforces sustainability).

Formula for Successful Specialization

·      Become an expert in your niche;

·      Forge brand alliances with other experts to provide non-traditional solutions.

Find your market niche by targeting the best customers for your business.  Let your passion and strengths for this market show.  Don’t try to be all things to all customers.  Focus.  Serve this market better than anyone else.  At times, it may be appropriate to identify other brands that may have a natural compatibility with your brand.  Brand alliances can be synergistic partnerships.  For example, Sky Team is a world travel network comprised of several airlines to provide improved global services to customers.  Or, think of “Intel inside” which has come to be defined as reliable quality and the many PC makers who carry this logo.  But be careful, brand alliances can only work when the partnership offers real value to consumers and is experienced in a similar context (i.e. brand and product fit). 

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