In my last post, I outlined how to get inside the mind of your buyer, and how the curse of knowledge hinders us during our strategic marketing planning.
Today, I’ll focus on how to communicate to your market using the language that will cause them to make a purchase decision. This language will come from your competitive advantages – clarified and distinguished strengths that fit a specific set of criteria, and will help you determine what “turf” you can own in your marketplace.
Not Seeing the Forest for the Trees
Did you know that in a past survey of CEOs of small to mid-market companies (from Jaynie Smith’s Creating Competitive Advantage), only 2 out of 1,000 CEOs could clearly articulate their distinguishable strengths that clearly separated them from their completion in the marketplace? Only 2!
They most common differentiator identified was … “We provide great service.”
Is that truly why their market buys from them? Or are these CEOs suffering from the tapping example I outlined in my previous post?
From my experience, I’ve found that many leaders at mid-market companies are handicapped by the curse of knowledge – they think that the marketplace hears their message clearly, simply because they hear it. And this hinders their growth, and overall company value.
The $10 Million and $25 Million Revenue Walls
There are two points in a mid-market company’s lifecycle where its growth will stall:
- $10 million in revenue
- $25 million in revenue
When we analyze how most small companies evolve into a mid-market company, we’re able to see how this occurs. Most are founded by a passionate entrepreneur, and grow due to a clearly communicated message to the marketplace – one that is clarified and distinguishable. That message was created by the founder, and s/he typically carries the company on his or her back for many years.
At the $10 million revenue mark, the company has captured all of the low-hanging fruit, and the sales efforts can no longer be led by the company founder. The messaging must evolve to stay competitive.
And fewer than 1% of small to mid-market companies ever achieve revenue greater than $25 million during the tenure of the founder. This occurs because they don’t create distinguishable competitive advantage in the mind of the market to create profitable, transferrable growth.
To create powerful, clear competitive advantages, you must be fanatical in your consistency for getting your message out through both your marketing and your sales efforts.
If you’re not convinced, here are some statistics to consider:
- 76% of salespeople will typically make only 3 to 4 attempts to communicate their message to a prospect over a 3 to 4 month period of time. They will make attempts in cold calling or an occasional note or letter; even some will aggressively pursue it by making a cold call to the prospect’s office, but for 76% of salespeople, this mark is where the prospecting and messaging stops, and their prospect never hears the message because it is neither clear nor delivered in a consistent manner.
- Only 4 irritating phone calls and a few voice mail messages over a 3 to 6 month period is not prospecting, and it certainly does not communicate a clear competitive advantage.
- 18% of salespeople will be a bit more persistent as they might attempt 6 to 8 contacts over an extended period of 6 to 9 months, and yet their results are not materially more effective than those in the aforementioned 76% group. That leaves only 6% of salespeople who understand the real work of prospecting. Yet without strong understanding of their competitive advantages, even these salespeople will underperform.
- Research says that 80% of all new business is created over an average of 18 months of prospecting with at least 12 meaningful, clear and powerful touches with a prospect.
Think about that last point. If your sales people and marketing team lead with messages that conveyed clear and compelling competitive advantages, will you shorten that 18-month selling gap? How much value do you gain if you can close your sales cycle by 30% or more? The work is hard. It takes time. And it takes guts and determination to deliver the message on a consistent, creative basis; but all the guts and determination in the world cannot take a weak message and create consistent results.
Now, put yourself in the shoes of your prospect, and evaluate your sales and marketing messages. Are they worthy of being heard? Do they cause you to take action? Think about the “tapping” example from my previous post; will the prospect understand what you are tapping?
Clarifying Your Competitive Advantages
Hopefully I’ve convinced you that your competitive advantages are absolutely essential for growth, profit and success. Now let’s define what a competitive advantage truly is. Many confuse competitive advantages with their weaker, less compelling cousins called strengths.
Let’s discuss the difference between the two.
I refer to these as the garden variety advantages – everybody has them. A strength is simply defined as those features and benefits of your products and services that are routinely mentioned by your employees and customers and most often proudly listed in your brochures, website and other marketing material. These are also referred to by your customers as the “me-too” points. They’re really just table stakes; every company has them, most companies use the same ones.
However, a strength doesn’t meet the qualifications of a competitive advantage. You cannot build a sound business on selling and marketing strengths; they sound good and make you feel better, but they don’t make any difference to your prospect.
A simple way to determine if you’re relying on strengths is to ask yourself the following, “Is what we are using in our marketing and sales messages something that if my salespeople worked for another company, they could say the same thing?”
Here are some examples:
We have great people
We provide great service
We’ve been in business a long time
We’re a stable company
We’ve have the best solutions
We’re the most competitive
We don’t forget you after the sale
All of these things are admirable, desirable and meaningful. The problem is, they don’t sell anything because the mind of the prospect cannot understand the tapping. So what do we do with strengths? A strength is a beginning point. It’s a foundation. It’s a place to start for understanding your competitive advantages.
A competitive advantage is a clear, concise and powerful strength that has certain very specific qualities. A competitive advantage can be any one or more of your strengths which you choose to focus upon; even though they might appear similar to your competitors, if you know how to make them dominant, you can use it to become dominant in the marketplace.
Dominant does not necessarily mean unique, different or even better, although as you learn to create them, work with them and use them, they will clearly take on a life of their own within your company and with the marketplace in which you portray them properly. Your competitive advantages are your strengths that you’ve made more precise, more distinguished and more memorable. If you know how to turn your strengths into competitive advantages, you turbo charge your process while your competition is still attempting to catch up using only basic strengths, which force them to lower their price to win.
Competitive Advantages Build Mindshare
Which would you rather have?
- A large sales team that makes a lot of client calls
- To be known for a “certain something” in the marketplace
Salespeople deliver incremental revenue, but having mindshare in the marketplace creates opportunities for rapid growth. Here’s an example of owning mindshare (for those of us over age 40):
What’s the safest car in the marketplace?
Most of us respond with Volvo.
But is Volvo really the safest car in the marketplace? Probably not, but they’ve owned that mindshare for many years. I can remember as a young, first time father, and I’ve heard this many times from others, when the realization struck me that I was going to be a father, I said to myself and others, “I’ve got to get my wife a safer car – she can’t drive around in that small sports car anymore….we need to look at a Volvo!”
Did I consider a BMW – the ultimate driving machine? Did I consider a Mercedes – the owner of the engineering mindshare? No, we bought a Volvo.
When you think of owning mindshare, think about the turf you want to protect – the territory you want to be known for. This isn’t difficult; it’s just a matter of deciding what’s important to you and selecting ground that’s currently not the territory of your competition, and then deciding how ferociously you want to defend it. This is a critical first step – it’s a choice, a place where you can determine what you truly want to be dominant.
Start by writing down all of your strengths. Strengths can come in many variations, but seeing them in black and white will get your mind working.
In my next post, I’ll show you how to evaluate your strengths by applying the dominant competitive advantage criteria, to determine which will help you own mindshare in the market.