From advanced telecommunications gear to raw chemicals, the “commoditization” of products continues unabated. Two factors have contributed to this trend. Fierce competition has led many companies to compete only on price. Economic conditions are also enabling buyers to extract even greater concessions from sellers.
How can companies differentiate themselves? Unfortunately, many companies have cut back on one tool at their disposal – marketing. Commodity-based companies often view marketing as an unnecessary expense. This strategic miscalculation perpetuates, and even accelerates, shrinking margins and smaller profits.
Strategic marketing programs that focus on promoting your “Universe of Value” will create greater awareness of your company’s differentiators to help you gain a competitive edge and increase profitability.
Identify your “Universe of Value”
Your “Universe of Value” is more than quality products. Quality is a given in business today. Instead, it extends beyond product to encompass the total value that you provide to customers. “Universe of Value” includes benefits that improve customers’ buying experiences, eliminate administrative burdens and improve operational effi ciency. These benefits are delivered at every point-of-contact with customers.
Carefully identify your real-world strategic differentiators. Don’t rely exclusively on sales personnel for feedback from the field. Survey customers to determine the real benefits that you are delivering.
An open dialogue with customers provides two main benefits. Communication can enable customers to realize the benefi ts of “built-in” or bundled value that you provide. Honest feedback from customers can also help you to more accurately identify your most valuable services. Let your customers help you see the forest through the trees.
Ultimately however, it is your responsibility to relentlessly promote the benefits that you deliver to customers.
Do you have differentiators?
… of course you do.
Perhaps your company has an online ordering system. The value to your customer is that it “significantly reduces inefficient administrative tasks to lower order processing costs”.
Making customers aware of this intrinsic value can help to relieve pricing pressures.
Your technical services may provide another marketing opportunity. In many cases, these services are provided as added value to product sales. Failure to effectively market these services can diminish their inherent value.
Innovative packaging may also be a differentiator that adds value to products. Let’s use rock salt as a product example. Very little difference exists between different rock salts. But companies that incorporate “easy to carry handles” into bulk packaging can drive preference for their brands.
This simple, yet powerful packaging modification can create greater demand from merchants, distributors and ultimately consumers.
These are just three examples. Scrutinize your business offerings, quantify the value delivered to customers, and communicate them to market.
Brand Your Differentiators
Once key differentiators have been identified, brand them. Simply branding for the sake of brand awareness is worthless (think about pets.com). Brands must be inextricably linked with your “Universe of Value” to generate customer demand.
A strategic branding program can help you more effectively communicate value to customers. Don’t simply look for products to brand. An innocuous service that is providing substantial help for customers is a strong candidate.
The goal is not to simply develop new names and design creative logos. Brands represent your company. They convey value. And most importantly, they can help to promote the benefits that your products and services deliver to customers.
Driving Brand Sales
Focused marketing support programs can effectively position your company as a preferred solutions provider. Promote your differentiators through strategic publicity, advertising, direct mail and trade events. Use testimonials to demonstrate how customers achieved specific results because of the value provided by your brands. Other users will want to reap similar benefits gained by the customers featured in your case histories.
Commodity-based companies should heed one key principal – market brand value.
Market your “Universe of Value” to begin to differentiate your company from the competition. Customers will begin to see that the services you provide are more valuable than the penny discount they typically ask for.
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