Be Different or be dead

March 17, 2010

Why aggressive competitors shouldn’t be your biggest worry

Why aggressive competitors shouldn’t be your biggest worry.

Why is building barriers to competitive entry really wrong?

Traditional marketing strategy spends a copious amount of time focusing on how to erect barriers to competitive entry.
Unfortunately in my experience this doctrine doesn’t go far enough and it certainly doesn’t create a sustainable competitive position for an organization.

Worrying about the competition is not where energies should be spent.

Worrying about the competition is misplaced — Here are 7 reasons why this traditional business approach doesn’t work:

It’s not a particularly unique approach to the market — Most organizations seem to follow this approach to minimize competition in their business; if everyone pursues the same strategy, how can it result in a differential advantage for any one of them? The truth is, it’s a business school course and every student takes it and typically tries to apply IT when there are other strategies that work much better.

The notion is rooted in a more theoretical perspective and falls short of the practical need to show business people how to do it. It’s all very well to salute a strategy that is rooted in strong theory, but if it can’t be practically implemented in the real world, it’s of little value.

It’s a distraction — While an organization is consumed with trying to find ways to keep the competition out, it’s not spending enough time to ensure their existing base of loyal customers are taken care of.

And it spawns an unhealthy culture that is preoccupied with preventing market activity rather than doing whatever is required to beat the competition in the trenches where the customers are. Earning their business everyday should be the priority rather than erecting barriers to others coming in to compete with you.

It diverts marketing attention — Away from investing in value based offers for the existing customer base. Rather, marketing resources are employed on other activities — regulations, patents and government restrictions — designed to keep competition away.

It creates an illusion — That competition can be restricted. It’s futile in the long run because a hungry competitor will always find a way to gain access to your markets and your customers. You will never keep them out or restrict their natural market activities.

It tends to focus on artificial non-market tactics — To prevent more competition such as regulation and law rather than beating them by providing amazing customer service and unmatched value.

It’s an ineffective use of valuable resources — With an outcome that is inevitable. Back in the day, the incumbent telecom carriers spent an enormous amount of money trying to prevent competitive entry into traditional monopoly markets through a time-consuming and expensive regulatory process.

The competitive tsunami wasn’t deterred, however, and they should have been paying more attention to creating better customer service and a marketing engine that provided compelling and unique value.

I am not suggesting that you shouldn’t pay attention to the competition, existing and potential.

But don’t get obsessed about preventing them from doing what is reasonable given free market conditions.
If they have an opportunity with your customers, expect them to make a play and respond by shielding your loyal customers from the onslaught of their competitive value proposition.

If you feel that a certain non-market response is necessary, go ahead and do it. But don’t let it be all-consuming. Don’t let it gobble up all of your resources. And don’t let it drain the effort in executing a customer response to the threat.

Observe your competitors but ACT for your customers.

Make it so difficult for your competition to attract your customers away from you - by providing them with constant unmatched value - they will be frustrated and will have to endure so much pain, they will decide it’s not worth it. And they will retreat.

How can you hold them? — What are some of the actions you can take to keep your customers close to you and prevent them from leaving?

Music is a great teacher.

The Grateful Dead informed us on how to create a unique competitive claim.

You don’t want merely to be the best of the best. You want to be the ONLY ones who do what you do. — Jerry Garcia, The Grateful Dead

And The Eagles’ Hotel California declares the impossibility of patrons leaving.

You can checkout anytime but you can never leave. — The Eagles

The message is cool. It’s mysterious. It’s haunting. It’s foreboding. It’s dramatic. It’s scary. It’s suggestive of a clandestine move.

Here are 8 actions you can take to prevent customers from ‘leaving your hotel’:

▪️Don’t be concerned about what the competition is doing; focus on the action that YOU need to take to enrich the stickiness of your products or services;

▪️Action to prevent leaving must be taken quickly. The time it takes to get to check-out and leave the building is short; rapid innovation of offerings your customers love is mandatory;

▪️Abandon the conventional; take risks with out there solutions;

▪️Give ‘em something more. Move ‘em to ‘another room’ with added value. Transform them into another world where a new reality intrigues them to stay;

▪️Intercept them as they make their way to check-out. Don’t follow up after they have left. Have your spider senses ready to know they intend to leave and disrupt their intentions;

▪️Give them a new experience that makes them want to stay. Give them something so dramatic that it will take their emotions to a new level;

▪️Make it personal Speak to them specifically. What works for Mr. Smith won’t work for Mr. Jones;

▪️SURPRISE! SHOCK! JOLT! AMAZE! FRIGHTEN! them to stay. Do whatever it takes.

Too much attention is given to the threat of others taking guests from our hotel.

If you want to worry about something, worry about the door closing behind them.

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 3.17.10 at 01:40 pm by Roy Osing
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February 15, 2010

Why internal customers are as important as external ones

Source: Pexels

Absolutely true. If the way people treat fellow employees is memorable, the customer experience will be delightful as well.

If the service provided among employee groups sucks, service to external customers will follow suit.

Employees need to WOW! one another if they in turn are to be able to WOW! a customer.

Organizations are a mosaic of customer - supplier relationships. Marketing serves Sales; Engineering serves Marketing and Marketing/Sales/Administrative functions serve the Customer Service Organization.

If external customers are to be dazzled, the delivery process needs to operate seamlessly and all delivery units in the organization need to dazzle each other; providing their piece of the service delivery chain and going the extra mile for their internal customer.

If one link in the chain fails then the chain breaks and the external customer is ‘de-dazzled’. If on the other hand every link not only plays their expected part but also goes the extra mile for their internal customers, the service provided to the external customer will most likely blow them away.

How do you know what level of service quality is being provided?

Constant measurement of the service quality provided to customers must be done; the use of internal report card Is the method I successfully used as the leader of many different types of organizations.

Service stories should be told. And service heroes should be honoured.

We need, however, to take this a step further and apply the report card process to measure internal service quality. Sales should rate the level of service Marketing provides them and Marketing should rate Engineering.

Every internal customer-supplier relationship needs to be measured to see if the customer has been dazzled in an engagement with another employee

How to build a report card

Its really not that difficult to do and it doesn’t have to be complicated.

Pick six deliverables Sales expects from Marketing, for example, and have Sales rate on a 1-5 scale how effectively and consistently Marketing delivers each.

Have monthly joint review meetings to discuss the results and strike action plans to address any shortfalls.

Include internal service quality in the bonus compensation plan. I assure you that if part of Marketing’s bonus is based on the report card from Sales, the marketing folks will definitely pat attention to Sale’s needs, wants and desires.

The payoff: the service delivery process gets better and better over time; internal customers get dazzled.

And, the external customer both reaps the rewards of having a delightful service experience and returns the favour with continued loyalty.

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 2.15.10 at 03:31 pm by Roy Osing
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February 6, 2010

3 easy and proven steps to make an astonishing strategy

Source: Pexels

3 easy and proven steps to make an astonishing strategy.

If you have to capture the essence of your business plan strategy in an elevator ride, here’s how to do it.

The best business plan  for your organization can be developed by answering these three questions:

1. HOW BIG do you want to be? — your growth and financial targets;

2. WHO do you want to SERVE? — the customers you want to focus on to deliver your HOW BIG numbers;

3. HOW will you compete and WIN? — the way you intend to uniquely deliver what your chosen customers desire.

The final step in the process is to seamlessly articulate the answers to these three questions into your strategic game plan statement — a compelling and succinct expression that leaves no doubt where the organization is going and how it intends to compete and arrive at its destination.

Here’s an example:

“We will grow our top line sales revenue by 3% over the next 12 months (HOW BIG) by focusing our scarce resources on the retired couples segment of greater Seattle (WHO to SERVE). We will compete and win by providing personalized transportation services to assist them in getting around the city. (HOW to WIN)”

There you go. Specific. Simple. Understandable. Compelling.

Your strategy elevator speech.

I find that the game plan is extremely valuable in explaining to employees where the organization is going, and painting a picture of what the strategy looks like when it is being successfully executed.

Rarely does a strategy session start with the objective of creating an expression of strategy that captures the minds and hearts of the warriors you will be counting on to win…. the strategic game plan statement does.

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 2.6.10 at 01:55 pm by Roy Osing
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February 3, 2010

Why a great business plan is absolutely clear on ‘HOW to WIN’

Source: Unsplash

Why a great business plan is absolutely clear on ‘HOW to WIN’.

Traditional business planning methods have issues; they’re all screwed up. 

The first two questions you have to answer in the strategic game plan creation process:
▪️ HOW BIG do you want to be? — what are your growth and financial goals?
▪️ WHO do you want to SERVE? — what are the customer groups you want to focus on to deliver your growth goals?

”How will you WIN?”

The third and final question one asks is a critical one: “How will you compete and win?, and the answer to the question drives a stake in the ground in terms of how you will differentiate yourself from your competitors and beat them handily.

HOW to WIN follows the WHO to SERVE question. You are looking for uniqueness relative to the customer groups you have chosen to target and not the market generally.
You may have capabilities that stand out from your competitors in the mass market, but the challenge now is to focus on those that relate to the particular customer groups you have chosen to meet your revenue growth goals.

This is very important. If you have chosen customer groups ‘A’ and ‘B’ for example, then you need to differentiate yourself from others vying for the attention of these two groups specifically.
You will be searching for ways of delivering what these two groups want in a more compelling and special way than anyone else attempting to do the same thing.

Answering the HOW to WIN question involves in-depth competitor analysis: Who are they; what are their strategies? How do they differentiate? What is their value proposition?

As a practical way of determining your competitive position, I suggest creating the ONLY statement for your organization.

“We are the only ones that…” will separate you from the herd! 

Jerry Garcia, former leader of the legendary rock band The Grateful Dead, nailed it: “You don’t want merely to be the best of the best. You want to be the only ones who do what you do.”

This is not a task for the faint-of-heart. Engage your team in the task. It involves looking at every nook and cranny in your organization for opportunities to separate yourselves from the pack - brand, service, product, product support, and how you leverage technology are some examples of where you can look.

Here’s an example:
“We are the ONLY team that provides integrated safety solutions that go beyond the needs of our customers ANYTIME, ANYWHERE. We are committed to grow our customer’s business. We ONLY serve safety.”

Rules for creating The ONLY Statement

▪️ The ONLY statement must speak to the experiences and value you create for people not the products or services you want to push.

▪️ Keep it brief. It’s a sound bite not a narrative. If it consumes a page it isn’t a viable claim.

▪️ Talk to the specific customer group you are targeting not the market in general.

▪️ Test your ONLY statement with customers and employees to ensure it is relevant and true.

▪️ Consider your ONLY statement a draft. The reality is you won’t get it right the first time, so take your almost-there only statement and start working with it.

Refine it as you go. And stay alert for a response by a competitor who may suddenly come awake when they see your move.

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 2.3.10 at 01:53 pm by Roy Osing
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