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Win Big, Know Your Market Position!

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peyton_manning_blog_10_2When it’s 4th and goal with no time on the clock, I want to know what my strengths are, what will work, and who I can depend on. That type of information gives me the power to call a great play and lead my team to victory. In business terms this means knowing where your company stands in relationship to competitors, capabilities, and customer perceptions. If you do not know all of these things you may call a bad business play. Like calling a run play in the red zone when you have the prolific combination of Peyton Manning and Marvin Harrison on the field. Go figure, we lost 3 yards, game over. Next time we will call the right play by knowing our position, our strength, our bread and butter.

Note: this article was adapted from a worksheet. win-big-know-your-position

Positioning

Positioning is the process of narrowing down a few key benefits that customer’s want and you have competitive advantage in. In other words, it is about playing to your strengths. There are two basic types of questions in formulating your positioning. Who & What. The Who concerns target markets, and competitors. The What concerns target benefit and competitive advantage.

Who

What

  • Who is your target market?
  • Who are your target competitors?
  • What is your value / benefit advantage?
  • What is your competitive advantage (edge)?

Who: Is Your Target Market

I know you have heard this time and time again, but it is worth restating. Know who you are targeting. It helps in many ways. Including:

  • decreasing marketing expenditure
  • yielding higher returns on marketing investments
  • narrows competition
  • creates niche expertise
  • provides richer information for decision making

The process of selecting a market segment can be intensive, but well worth the effort. In future Bazooka Biz articles we will get into more detail about selecting target markets. Below is an outline of some steps to begin the process of target market selection.

Target Market Worksheet

Q1: Who is most likely to want or need your products/ services? Describe your typical customer(s).

Q2: Why this particular market? Is it profitable, do you have advantage, niche, etc. WHY?

Q3: Who are the customers in this market (specific)?

  • Age Range
  • Gender
  • Ethnicity
  • Income
  • Occupation

Q4: Customer Psychological Make-Up (Lifestyle)

Q5: Where are they located?

  • Live
  • Work
  • Shop

Q6: What’s important to your customers

Q7: What are 3-6 Key benefits your customers seek? (e.g. what points-of-pain or problems need to be solved)

Q8: How do you fulfill these key benefits?

Q9: What do you customers consider before they purchase your products or services?

Q10: How are your customers influenced by price?

Q11: What other factors can affect your customers purchase or use decision?

Q12: What attitudes do customers have about the industry you serve (e.g. are they enthusiastic, confused, lacking information, expect high quality, could care less, etc.)?

Q13: Can your product / service be easily replaced? What other products do you compete with?

Q14: What are some key frustrations your customers have with your business?

Who: Is Your Target Competitors

During this phase you want to carve out a list of competitors. Try to get beyond the most visible competitors (e.g. top of mind, leaders in the industry, etc.) to get a more comprehensive list. Types of competitors to consider include:

  • top of the market (those you are chasing)
  • at your current level
  • same geographic area
  • startup competitors
  • etc.

To get even more competitors on your list, ask current customers and do internet research. Remember, that your list should only include those who are competing directly with you in the target market you have selected. A company may sell similar products, but not target the same markets you have isolated.

Another key thing I like to do when doing a competitive analysis is create an imaginary company. This company does everything well and my target market loves them. In envisioning this company I get a better understanding of my ?company’s weaknesses. This also is useful if you have no direct competitors, as it gives you a way to measure your strengths in regards to perfection.

Target Competitor List

Competitors

Notes: (strengths, weaknesses, reason why customers use them, comparatives)

What: Is Your Value / Benefit to Your Target Market?

No other point means as much to business success as providing value to customers. That is why knowing what value / benefit you provide to your target market is like possessing the Holy Grail. You instantly have this magical power to give customers what they want, providing real value.

Providing real value starts with working with accurate information. Accurate information comes from primary sources, directly from the horse’s mouth, namely your customers. Customers are the ones who can give it to you straight and un-filtered, providing useable data on your true value. Other sources of information are to be strictly used for supplemental purposes.

Below is a list of ways of getting information about your company market value. Note they have been arranged from best to worst.

  1. Customer Base (Primary)
      • current customers – full of useful information about how you stack up.
      • new customers – may be able to tell you why they patronize your business
      • lost customers – where did you go wrong
      • heavy users – know all the wonderful things of your products
      • potential customers – concerns, questions, apprehensions
  2. Industry Research (studies) / Books / Publications
  3. Internet Research (e.g. epinions, review page, view points, etc.)
  4. Employees
  5. Management
  6. Senior Management
  7. Business Owners

Notice that the higher you go up the chain of command in a company the worse the source of information becomes. This is due to the fact that generally the higher up you are in the company the further removed you are from the customers. Also the higher up you are the more vested you are in the success of the company, which biases you to objective critique.

Knowing who and where to get the information on perceived value from is only 20% of the battle. The lion’s share of work is in creating vehicles for information collection, analysis, and implementation. A full in-depth look at any of these 3 areas could fill many books. We will briefly summarize a few steps in each area of Information Collection, Information Analysis, and Information Implementation.

Value / Benefit Information collection

Collecting information from customer base should be a part of the organizational workflow. Each touch point should maximize the process of collecting information. This means that things like employee interactions, email correspondence, web sites, flyers, promotions, etc. all should somehow tie back into information collection. Examples of a company’s touch points might include:

Touch Point Collection Channels

  • Employee interaction (in store, on phone, at register, etc.)
  • Inbound / Outbound calls
  • Sales Team
  • Website / Blog
  • Surveys
  • Marketing Materials
  • Shipping Department
  • Customer Service Department
  • Accounts Payable
  • Email
  • Other – List Below
Select which touch points you will use in your company

Direct survey and industry survey groups are other ways of getting rich data from customers on the value of your services. Conducting random surveys of customer base (see above) will give your company much needed real-time information to plan from. Recent research indicates that using mixed mode surveys is key to deployment. This means a company should use several vehicles for survey deployment. This may include a combination of:

Survey Deployment

  • Telephone
  • Email
  • Direct Mail
  • In Store
  • Paper Correspondences (e.g. bills, invoices, etc.)
  • Other – List Below
Select which survey deployment you will use in your company.

Value / Benefit Information Analysis

Analyzing information does not need to be super complex. Depending on your type of deployment, data entry into a centralized database should be simple and straight forward. Services like Zoomerang allow you to export online and email survey data to be used with offline data.

For example, we recommend a simple value based table be created ranking the relative importance of each value and how you think you stack up. (Note full in-depth study of organizational capabilities is in the next section)

Relative Importance (1-10) Value / Benefit Organizational Capability (1-5)
10 Reputation / Knowledge 4
10 Convenient Location 5
8 Availability / Hours 3
8 Facilities / Professional Environment 4
8 Parking 2
7 Staff Treatment / Attitude 4
7 Onsite Pharmacy 3
Sample value table: Doctor Office














Note: Relative Importance 1 – Not Important, 10 – Very Important
Organizational Capability 1 – Poor, 5 – Excellent

The above relative value to capability table is a simple example of how a doctor’s office might organize information collected from patients. In this example the patients place high value on reputation and convenient location. This is good news for our doctor’s office because its capabilities match up well with these values.

The key here is not to get stuck in the paralysis of analysis. Find the trends and act on them.

Implimentation

All the information in the world means nothing unless it is acted upon. Once you find a trend in value perception, seek to fix it or use it. That is, if you see a trend of value being customer support then beef up your customer support yesterday. If you find a trend of mobile phone use, then develop a mobile website yesterday.

Values shift, wants and needs change, so information collected has a short shelf life. To be effective you must use information quickly and develop a get it implemented yesterday mindset. This type of company emphasis can only work with full support and dedication from top management. (See Information is King & 5 Keys to Successfully Implementing Your Marketing Plan for more information about implementation)

Brief summary of plans of implementation: (note this is only a summary. The implementation should be comprehensive and backed by serious planning)

What: Is Your Competitive Advantage (edge)?

Business growth and sustainability is based on competitive advantage. That is, your company’s future is bound to your capabilities as they relate to your competitors. If you have capabilities that are unique to your company, and customers that value that capability, you have an edge.

The advantage whether it is a skill set, resource, geographic location, inside information, or other, is what separates competitors. Further distance is created by the uniqueness of the capability advantage. For example, a gas station that installed an automatic car washing system that customer’s value has a distinct edge over competition. That is, until the competitors have a similar system installed. In this example the advantage was not unique, so the advantage could only be held in the short term.

The first step to finding your edge is to examine your capabilities to find areas of competitive advantage. These advantages become an edge when you can link them directly to customer value. An advantage that customers do not value means little.

We recommend 3 types of analysis:

3 Types of Analysis (Select 1 or more types)
1. Customer Based (primary source of information about rankings)
2. Industry Study or Comparative Publications
3. In House Team Analysis

A combination of the above 3 competitor analysis works best depending on budget and availability. Using your touch point questionnaires and survey model as discussed earlier you could easily deploy a customer based competitive analysis. Industry study may not be available for small industries or local types of businesses. An in house team analysis is an inclusive effort, not a one person thing. Getting comprehensive feedback from all team members will yield much better information than isolated analysis.

Competition table information

The type of information you collect is the same regardless of analysis method chosen above. In each case you want to find out how your company and competitors rank in relationship to values / benefits of your target market. You will then arrange this data into a competition table for review.

The Competition table displays 3 types of data.

  1. Values of Customers: you have already listed values in above steps
  2. Organizational Capabilities: how does your company meet each of these above value
  3. Competitor Capabilities: how your competition meets each of the above values

Each type of data will have a specific type of ranking.

  1. Values of Customers: 10 – 1, with 10 being highly relevant to target market.
  2. Organizational Capabilities: Below Average, On Par, & Superior (in relationship to your competitors) & is your superiority future proof (sustainable)

For example you have identified reputation as being one of the key values of your target market. Does your company have a superior reputation than your competition? Is your superior reputation future proof and sustainable? The below table outlines an example Doctor’s office and how it might display a competition table.

Competitive advantage table

Competitive Advantage: a capability that allows an organization to provide a benefit to its customer base at a superior level than the competition.

Competition Table
Relative Importance (1-10) Value / Benefit

Competitor 1

Competitor 2
P S F P S F
10 Reputation / Knowledge x x x x x x
10 Convenient Location x x x
8 Availability / Hours x
8 Facilities / Professional Environment x x x
8 Parking
7 Staff Treatment / Attitude x x
7 Onsite Pharmacy
Par / Average Superior Future Proof Par / Average Superior Future Proof

Cell Key:

  • Par / Average: means you are meeting with sufficient capability in regards to this value. You are running with the pack, thusly on par / average
  • Superior: you are leading the pack and out pacing your competition
  • Future Proof: you can hold this advantage in the foreseeable future (sustainable)
  • Empty: means below average (competitors are better than you)

From the above table, our doctor’s office core strength is reputation and convenient location. The office should promptly add capability in the areas of available hours and facility upgrades. Parking may be one of those things they can’t change without moving, which may alter their advantage in terms of location.

Sample Positioning Summary?

Our doctor office studied his market and narrowed down his efforts to focus on the young professional crowd 26-41 years of age. This target market reside near where they work in the downtown area, which makes his location very valuable. He knows from his target market study that they also value convenience (do not like to travel far). This market likes

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One Comment »

  • Hasani Lateef X (author) said:

    Whats your position?

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