Once again quoting Peter Drucker, the purpose of a business is to create and keep a customer. So, where should you start to architect your business success?
Who are your distinct customers? What are their unique wants and needs? What motivates them to buy?
Long, long ago, we created buyer profiles to identify the unique characteristics of our customers. Today, we call them buyer personas and even create avatars to represent each unique type of customer.
It doesn’t matter what we call them, because what’s important is your deep understanding of each different customer type.
- Have you defined and named your unique customer types?
- Have you identified the challenges and opportunities they face?
- Have you examined their unique wants and needs?
- Have you determined what motivates them to buy?
- What other unique insights can you capture about each type?
- Have you isolated why they would buy your products and services?
If you haven’t spent the time deeply understanding and documenting your different customer types, do it now!
It’s an essential first step to architect your business success – creating distinct customer segments.
Before you move on from this building block for your business success, check out our Blog post – Do Customers Find You or Do You Find Your Customers?
Products and Services
Most businesses do a good job of telling their customers about their products and services.
They are proud to tell you about every feature, function and detailed specification as well as in many cases they can even extol the distinct advantages their products and services offer compared to their competition.
Most of their customers, frankly, could not give a damn, Scarlett. They are all tuned into the same radio station – WIIFM – what’s in it for me?
Where many businesses fail is communicating the benefits their customers realize when they purchase their products and services.
It’s hard work to sit on the customer’s side of the table and look at your business, but it is essential to see the world through John Jones eyes, if you want to sell John Jones what John Jones buys.
Unless your name is Walton, you should not be pursuing a “low-cost leader” pricing strategy.
If you aren’t going to pave your road to riches by rolling prices back to the 1970’s or offering a wide selection of $1 value meal selections, how should you price your products and services?
Most business owners choose one of two strategies:
Cost-based pricing: This is the Finance-led approach to pricing. Your accountant crunches all of the costs of producing your products and services, then applies an arbitrary markup for profit. The problem with this approach is it seldom reflects the real costs of production, as many costs vary wildly at different volumes.
Competitive-based pricing: This is the Marketing-led approach to pricing. You look at your key competitors and set your prices slightly lower than their prices. One problem with this approach is your competitors may have used cost-based pricing – see the problems with that above. Another problem with this approach is your competitors may have used competitive-based pricing. Now your whole industry is copying every one else – does anyone know what the price should be?
Before you throw cost-based and competitive-based pricing out the window, both are very important considerations in your pricing strategy. But neither should be the final determinant of your prices.
The holy grail in pricing is value-based pricing. You consider your costs. You consider your competition. But then you unpack the benefits of your products and services and the value they deliver to your unique customer segments.
It’s this combination – customer segments, product and service benefits and value-based pricing – that allows you to position your business as a market leader and architect your business success.
Marketing textbooks would tell you that this building block to architect your business success is Place, one of the “P’s” in the marketing mix.
It’s true, you need to know where you will sell your products and services – your methods of distribution. Will you sell in retail stores, online, through independent distributors, through employee sales representatives, factory-direct or many other methods, or some combination of these methods of distribution?
Each distribution method offers its own set of opportunities and challenges. Once you add a second, third or additional distribution approach, you will then experience the joys of channel conflict.
What “Place” fails to address is how you will sell in each channel.
- What’s the process to attract, engage and convert an online buyer?
- What’s the sales process to prospect, present and close for a distributor or rep?
- What’s the sales process to capture an inbound inquiry, investigate needs, design a solution and secure a purchase order?
Where you sell your products and services is a key element to architect your business success, but if you neglect how you will sell through that distribution method, it won’t matter where you plan to sell, because you won’t be achieving your sales goals.
We help our clients discover the most profitable “where” they can sell as well as the “how” to sell in that setting. Learn more about our distribution services and don’t miss our Blog post – Why Your Approach to Selling Fails Your Sales Team.
Let’s pause here and congratulate you on the steps you have taken so far to architect your business success:
Customers: you identified your unique buyer profiles or personas and defined their wants and needs, what motivates them to buy and why they would buy your products and services (the needs and wants that you meet).
Products and Services: you have gone beyond features, functions and advantages and isolated the benefits your customers realize when they purchase your products and services.
Pricing Strategy: you have done your homework on your own costs and your competitor’s pricing, but gone far beyond to implement a value-based pricing strategy.
Distribution: you have examined both where you will sell your products and services as well as how you will sell in each particular distribution channel.
Promotion is marketing’s black hole. Business owners spend, spend, spend on promotion while smoking hopium – hoping that something works and creates a prospective customer.
Most don’t know what works and even worse, they don’t know how to make it work. So they just keep spending, spending, spending and smoking more hope that something will work.
What does work in promoting your products and services? We’ve uncovered three key elements in the past 30+ years:
Marketing Combinations: the late Jay Conrad Levinson, creator of Guerrilla Marketing, boldly stated that NO marketing method works. What works are marketing combinations – direct mail driving traffic to your website, advertising to attend a Webinar, outbound calls to offer something free with no risk or obligation.
Commitment and Consistency: all businesses have limited resources – limited time and money to spend on promotion. Unfortunately, far too many business owners utilize their limited resources by spreading them around. They run a single ad in a print publication, attend one trade show every year, send an email newsletter intermittently.
They would be better served by committing to a single promotion strategy and consistently executing that method. You don’t want to stay a “one trick pony’ forever, but focus first, then build the multiple pillars that our mentor Jay Abraham prescribes.
It’s All About Your Customer, NOT All About You!: If all of your promotions scream “me, me, me,” they will not work. If all of your promotions scream “you, you, you” (your customer), they will work. It’s that simple.
Nothing is more important than this principle in marketing promotion – it’s not all about you!
There are dozens, if not hundreds, of online promotion and offline promotion strategies to consider. We can help you choose the best strategies to architect your business success, as well as create, develop and execute those strategies for you and your business.
Creating Your Marketing Blueprint
Understanding your customers, defining your products and services, creating your pricing strategy, determining your distribution methods and developing your promotion strategies are all essential elements of architecting your business success.
But, there’s more work to do. You’ll need to develop your strategies and plans:
Examine the Past: Where has your business been? What are your growth patterns and trends, major milestones, successes and failures? What have you learned from these experiences?
Study the Present: Where is your business now – what is your current situation? This includes examining your external opportunities and threats as well as your internal strengths and weaknesses, including social, political, economic, regulatory, environmental, technological and competitive issues affecting your business.
Design the Future: Where do you want your business to go? What’s are your values, vision and mission? What are your specific, measurable and time bound objectives and goals?
Develop Strategies and Plans: What are the key activities that you must execute to achieve your success? Who is responsible for execution in each key area of your business?
Create Accountability: How will you communicate your plans, measure progress and ensure everyone in your organization is focused on creating and keeping customers in your business?
In the past 30+ years, my strategic partners and I have helped thousands of businesses architect their business success. We can help you too!