What’s Your Tiebreaker?
Powerful ways to differentiate your business
January 12, 2010
Edited by: Ken Beaulieu in: Getting New Customers
Right now there are potential customers trying to decide whether or not to choose your business. Unfortunately, most of them can’t see much difference between you and your competition. You all offer quality products or services. You all seem to have competent, helpful employees. That leaves one factor to drive the decision: price.
Welcome to the commodity trap. It’s a place in which lowest price almost always wins because customers don’t see any other difference. To escape the commodity trap, you have to have a tiebreaker, a reason for potential customers to say, “OK, that’s the difference. That makes my decision.” Tiebreakers usually aren’t anything particularly unusual or exotic, but more often the mastery of your customers’ basic expectations. As part of a business development strategy, here are some areas that can differentiate you from the competition:
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Be the fastest: respond quickly, and always on time. Become known for returning customers’ calls within one hour, guaranteeing two-day delivery, paying your customer if you are late for a service call, or responding to emails with lightning speed.
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Be the easiest to do business with: become the “no hassle” choice. This has been listed as the No. 1 factor with business-to-business customers, and it is equally important to retail consumers. Look at every aspect of how you interface with customers and correct anything that might make you the least bit difficult to do business with. Are your invoices clear and easily understood? Is your Web site easy to navigate? Do you empower employees to say yes to customers without always having to get approval from a manager? Be easy to deal with and win more business.
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Let the customer choose: provide more selection and customization. Today’s customers want exactly what they want, exactly how they want it, whether it’s the music mix on their iPod or their no fat, extra hot latte with a shot of vanilla at the coffee shop. Give them what they want, not what you want to give them.
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Demonstrate value: offer a competitive price and clear worth. You don’t have to have the lowest price, but you do have to demonstrate that you’re a great deal. That’s the essence of value. Never take for granted that your customers understand that you’re worth what you charge. Spell it out for your customers. Educate them. It’s not their job to see your value; it’s your job to show them.
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Be relevant: take a “big picture” approach to serving your customer. In any business development plan, look beyond your customers’ immediate needs to a bigger picture view of how you can help them succeed, make their lives easier, or create new opportunities for them. For example, one company that sells pipe to building contractors invites its best customers to annual seminars on business development.
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The ultimate tiebreaker: consistency of performance. While it’s great to hear “superstar” stories about employees that go above and beyond for customers, the most powerful tiebreaker in today’s marketplace is consistency. Customers want to know that no matter who they deal with in your company, they will receive the same level of great service every single time.
— Joe Calloway, partner in Engage Consulting Group and author of the newly revised edition of Becoming a Category of One.
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January 12th, 2010 at 12:12 pm
Ken,
Today’s post made me think of a book/author you could feature. The name is Dale Furtwengler. He wrote a book called “Pricing for Profit.” He states that many companies compete on price because they are unable to quantify their true value to their market. Similarly, their target market finds it equally difficult to understand the value, so price becomes their benchmark. Furtwengler discusses how to break that trap and communicate real value. I’ve found it to be a very good read. Just thought I’d pass on the tip.
Regards,
Rate comment:Ryan Nokes