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Test Your Value Proposition in 3 Simple Steps

A surefire approach to increasing sales!

Prospective customers all want the answer to the same exact question; what do you do and how do you do it better than your competitors?  Every sales representative or distribution channel for your business needs to clearly articulate the value proposition to each target market.

Marketers spend hours, days and weeks in workshops and meetings to carefully develop the perfect elevator pitch.  Then, the company prepares messaging, presentations, campaigns and more to test their theories.  This process is not only time consuming but typically yields at best “hit or miss” results.

Isn’t there a simpler, surefire way to get it right?  Yes, with these 3 simple steps:

1. Create a competitive matrix for each target market.

  • Company profiles, i.e. revenue, locations, # employees, # customers, target markets, sales distribution channels, partner strategies, service and support.
  • Company offerings, i.e. key features, functionality, ease of use, ease of deployment, delivery mechanism, security, pricing.

2. Develop a customer satisfaction survey with open-end and closed questions.

OPEN:  What problem do you solve for them?  How do they use your offering?  Why did they select you versus your competitors?   What do they like about your offering, what don’t they like?  What improvements would they like to see?   What do they like or not like about your company, support, and service?

CLOSED: Can you stack rank certain features/ functionality of the offering?  Do you see certain features or functionality as unique?  Can you rank your overall customer experience?  Can you grade specific service or support calls?

3. Interview your existing customer base

Your best source of feedback, validation or refinement of your competitive advantage/value proposition is right at your feet: your existing customers.  They have already been through the sales process with your company and your competitors, and they selected you!  They are typically friendly, knowledgeable and willing to share the information you need most.  Ask for just 15 minutes and mention that you will be using the feedback to make improvements for them.  Evaluate your results carefully, because existing customers will teach you exactly how to market and sell to new customers, and we all seek the best approach to acquire new customers.

The good news here is that the existing customer base is the lowest cost and most effective way for marketing leaders to corroborate or better articulate competitive differentiators and value propositions.  In fact, listening to existing customers, prospects and targets, keeping your ear to the ground continuously, is the very best way to achieve your goals.

So, what if you don’t have an existing customer base?  Obviously there is the focus group approach, on-line or in person.  Choose a group that is currently using a competitor and ask why.  Ask them the same feature/functionality questions, pricing questions that you would ask an existing customer.  The more narrow and focused your approach, the better the results.

Good luck and good selling!

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Positioning: Dare to Differentiate

©iStockPhoto/hidesy

©iStockPhoto/hidesy

Most of us occasionally suffer from “following the herd” mentality, but effective positioning requires companies to deviate from the norm and establish their own unique position. When formulating a positioning statement, the statement should (1) clearly articulate the company’s understanding of market needs, and (2) present a defendable value proposition that is meaningful to target audiences. At Attain, we find that this second requirements is particularly challenging for young companies.

In a recent client engagement, we did a competitive positioning audit and found that 6 in 7 of the companies in the space claimed a market leading position — and yet our client was hesitant to drop “leader” from their positioning for fear that potential customers would not consider them as a viable market player.

This line of reasoning is prevalent in the technology industry. If ‘Company A’, the true market leader as defined by market share, claims it is the leading provider of widgets, the new market entrant ‘Company B’ claims it is the leading provider of next-generation widgets, and so on until you have the whole sector claiming they are “the leading provider of [insert adjective] widgets”.

How is it possible to create a defendable value proposition by following the herd? The answer is, it isn’t. It doesn’t matter what a company believes or wishes to be true. Positioning is about how companies are perceived in the minds of their target audiences. And I have yet to meet a prospect who cares to split hairs over the semantics of a company’s messaging.

Dare to put the differentiation back into positioning by answering the prospective customer’s question, “Why do people choose your company?” (Hint: it isn’t because you are 1 of 6 “market leaders”) To find the real answer to this question, try talking to customers, prospective customers and competitor customers (if possible).

A defendable and meaningful positioning platform requires that you understand the factors that motivate the buying decision within your space. So ask customers what factors they considered when making their decision (i.e., quality of offering, breadth of offering, depth of offering, pricing, innovation, value, credibility, market expertise, etc.) and then divide those attributes into the following hierarchy:

  • Compelling Attributes: What attributes actually compell them to buy from you instead of the competition?
  • Differentiating Attributes: What attributes begin to differentiate your company from the competition? You may share these attributes with some, but not all of your competitors.
  • Necessary Attributes: What attributes establish you as a viable vendor but do not, however, differentiate you from your competition.

Target Audience Motivators

Target Audience Motivators

When you understand the attributes that compel someone to buy your product/service instead of the competitions’, you can begin to define a position that is both differentiated and defendable.