Unique
Selling Proposition (USP)
Before you
can begin to sell your product or service to anyone else, you have to sell
yourself on it. This is especially important when your product or service is
similar to those around you. Very few businesses are one of a kind. Just look
around you: How many clothing retailers, hardware stores, air conditioning
installers and electricians are truly unique?
The key to
effective selling in this situation is what advertising and marketing
professionals call a "unique selling proposition" (USP). Unless you
can pinpoint what makes your business unique in a world of homogeneous
competitors, you cannot target your sales efforts successfully.
Pinpointing
your USP requires some hard soul-searching and creativity. One way to start is
to analyze how other companies use their USPs to their advantage. This requires
careful analysis of other companies' ads and marketing messages. If you analyze
what they say they sell, not just their product or service characteristics, you
can learn a great deal about how companies distinguish themselves from
competitors.
For
example, the late Charles Revson, founder of Revlon, always used to say he sold
hope, not makeup. Some airlines sell friendly service, while others sell
on-time service. Neiman Marcus sells luxury, while Wal-Mart sells bargains.
Each of
these is an example of a company that has found a USP "peg" on which
to hang its marketing strategy. A business can peg its USP on product
characteristics, price structure, placement strategy (location and
distribution) or promotional strategy. These are what marketers call the
"four P's" of marketing. They are manipulated to give a business a
market position that sets it apart from the competition.
Sometimes a
company focuses on one particular "peg," which also drives the
strategy in other areas. A classic example is Hanes L'Eggs hosiery. Back in an
era when hosiery was sold primarily in department stores, Hanes opened a new
distribution channel for hosiery sales. The idea: Since hosiery was a consumer
staple, why not sell it where other staples were sold -- in grocery stores?
That
placement strategy then drove the company's selection of product packaging (a
plastic egg) so the pantyhose did not seem incongruent in the supermarket. And
because the product did not have to be pressed and wrapped in tissue and boxes,
it could be priced lower than other brands.
Here's how
to uncover your USP and use it to power up your sales:
1) Put
yourself in your customer's shoes.
Too often,
entrepreneurs fall in love with their product or service and forget that it is
the customer's needs, not their own, that they must satisfy. Step back from
your daily operations and carefully scrutinize what your customers really want.
Suppose you own a pizza parlor. Sure, customers come into your pizza place for
food. But is food all they want? What could make them come back again and again
and ignore your competition? The answer might be quality, convenience,
reliability, friendliness, cleanliness, courtesy or customer service.
Remember,
price is never the only reason people buy. If your competition is beating you
on pricing because they are larger, you have to find another sales feature that
addresses the customer's needs and then build your sales and promotional
efforts around that feature.
2) Know
what motivates your customers' behavior and buying decisions.
Effective
marketing requires you to be an amateur psychologist. You need to know what
drives and motivates customers. Go beyond the traditional customer
demographics, such as age, gender, race, income and geographic location, that most
businesses collect to analyze their sales trends. For our pizza shop example,
it is not enough to know that 75 percent of your customers are in the 18-to-25
age range. You need to look at their motives for buying pizza -- taste, peer
pressure, convenience and so on.
Cosmetics
and liquor companies are great examples of industries that know the value of
psychologically oriented promotion. People buy these products based on their
desires (for pretty women, luxury, glamour and so on), not on their needs.
3) Uncover
the real reasons customers buy your product instead of a competitor's.
As your
business grows, you'll be able to ask your best source of information: your
customers. For example, the pizza entrepreneur could ask them why they like his
pizza over others, plus ask them to rate the importance of the features he
offers, such as taste, size, ingredients, atmosphere and service. You will be
surprised how honest people are when you ask how you can improve your service.
Since your
business is just starting out, you won't have a lot of customers to ask yet, so
"shop" your competition instead. Many retailers routinely drop into
their competitors' stores to see what and how they are selling. If you are
really brave, try asking a few of the customers after they leave the premises
what they like and dislike about the competitors' products and services.
Once you
have gone through this three-step market intelligence process, you need to take
the next -- and hardest -- step: clearing your mind of any preconceived ideas
about your product or service and being brutally honest. What features of your
business jump out at you as something that sets you apart? What can you promote
that will make customers want to patronize your business? How can you position
your business to highlight your USP?
Do not get
discouraged. Successful business ownership is not about having a unique product
or service; it's about making your product stand out -- even in a market filled
with similar items.
