Article courtesy of Joe Gracia with www.GivetoGetMarketing.com
Today's article is about competition and how to deal with it.
I have a product that is in very high demand. But lately I have been losing a lot of business to a competitor from India who is selling a lower quality version for a lot less money. What advice do you have to fight competitors who take away your business with cheaper products and prices?
-- Greg, Santa Rosa, NM
Thank you for your note and your marketing question.
Obviously, without the details of your particular business and market situation, etc. it's difficult to prescribe specific solutions.
However, I can make some general observations and suggestions.
Competition Will Always Be Here
Everyone has competition. As soon as there is an opportunity for profit there will be others who will jump right in to get as much of that opportunity as possible-- and they don't care how it affects you or your business. If they can put you out of business and take all of your customers, they will. That's the capitalist system. And in my opinion, it's a good system. Cream rises to the top.
Remember you are someone else's competitor.
You said that your competition from India sells a product of lower quality, and you sell a higher quality product.
If that's true, then you are both essentially selling different quality versions of a product to different markets.
There is a market for lower quality, lower priced products, and a market for higher quality, higher priced products. These are different people.
The people who want higher quality, are not in the market for lower quality versions. And the people who are looking for lower priced products aren't looking for higher quality, higher priced versions.
There are people who want inexpensive pens that can be tossed when they run out of ink. And then there are people who want expensive pens that they will keep forever.
Again, those are completely different target markets.
You need to focus on 100% of your time and energy on 'your' target market of quality seekers.
Your goal should be to attract the quality seekers to your business, and then show them why your product is higher quality.
Tell them about all of the benefits that your product offers. Tell them about the advanced features. Tell them everything they want to know about your higher quality product. They want to make sure they are getting what they are looking for, so tell them everything they want to know.
Give Them What They Want
Marketing is all about giving people what they want.
In general, they want
-- products and services that solve their problems or help them achieve something they want
-- they want good prices
-- they want the best overall value they can get
-- they want excellent customer service
-- they want convenience
-- they want hassle-free guarantees (stand behind your product)
-- if they're unhappy with their purchase, they want to know that they can get their money back
-- they want the buying process to be easy
-- they want social proof that your product and your business delivers what it promises (testimonials)
etc. etc. etc.
Forget About Your Competition
I will tell you exactly what I have told every one of my past clients; don't focus on your competition.
They will always be there. And they will be working hard to take away your customers.
Of course you should know what they are doing, so that you can learn from their successes, but you need to spend every minute of your time focusing on becoming more valuable to your customers.
Forget about your competition and instead compete against yourself. Develop an attitude of continuous improvement in your product, in your service, in your business systems.
Focus on becoming a better and better marketer. Test new strategies and compare the results so that you can find higher and higher benchmarks. If you send out a direct mail letter to your list of customers (you do market directly to your list of customers, right?) then keep accurate track of how many letters you mailed and how many responses you received. If you mailed 1,000 and got 10 responses that is a 1% response rate. Then try to improve your offer in your letter so that you can get a 2% response rate.
That increased response means that you have just found a way to offer your customers even more of what they want. When you do that, your responses go up.
Keep doing that with every aspect of your marketing and you will continuously improve your sales and profits.
You can never succeed by focusing on your competition--only by focusing on your prospects and customers.
Compete Against Yourself
The absolute best way to eliminate competition worries is to become a better marketer. You simply must market your business in a superior way.
You've got to start competing against yourself, instead of competing against others. Continuously improve your marketing systems, and compeitition worries will disappear.
Very often when a new client tells me that their competition is having a negative impact on their sales, I find just the opposite is true.
It is in fact, their poor marketing and management practices that are having that negative impact on their sales and profit.
Once we improve their marketing and management systems, miraculously, the negative impact disappears and their sales and profits begin to flow unimpeded.
That's good. Because there isn't much you can do about your competition except to improve your marketing strategies and systems.
Here are the four marketing skills you need to continuously improve:
1) Learn to attract more and more qualified prospects to your business
2) Learn to convert more and more of those into First-Time Buyers
3) Learn to convert more and more of those into Repeat Buyers
4) Learn to convert more and more of those into Advocates who refer their friends, family and associates to your business. If you'd like to learn simple, step-by-step ways to do the above, you may want to consider my course:
By Joe Gracie with Give to Get Marketing
Every business loses customers. That's just a fact of business life.
But if you know the reasons that your particular customers leave, then you have an opportunity to reduce that number as well as reactivate some of those who left in the past.
Why do customers leave?
The Small Business Administration offers the following reasons:
68% were upset with the treatment they've received
14% were dissatisfied with product or service
9% begin doing business with the competition
5% seek alternatives or develop other business relationships
3% move away
There's not much you can do about the last one. And unless you sell via the Internet or Direct Mail there's not much you can do about the fact that some of your customers simply move away.
But you can certainly do something about the remaining four reasons.
1. Follow-up with your customers
Periodically follow up with your recent customers via phone and ask them if they are happy with their experience with your products, services and your company.
Let them know how much you appreciate their business. Ask them if there is anything they would like to see you improve.
One of our clients told us that he couldn't believe how pleased his customers were that he called to ask about their experience. More than one commented that this was the first time any business had cared enough to ask.
It will make a big impression on your customers too.
2. Listen to your unhappy customers
It's tempting to discount unhappy customers as a thorn to be removed as quickly as possible. But don't be so quick to discount their complaints.
Listen to them and try to determine if they have a legitimate concern. Take steps to find out if more of your customers are experiencing the same problem(s).
It's nice to hear compliments, but significant improvements in your business often come from people who tell you where your weaknesses are. Because then you have an opportunity to improve.
If you hear complaints from 2-3 customers, you can bet that there are dozens, maybe even hundreds more who feel the same. Most unhappy customers never say a word to you -- they just disappear forever.
3. Get ongoing feedback from your customers
One of our clients was losing customers like crazy. He didn't have a clue why they were not coming back.
I instituted a simple survey system. His cashiers handed every customer a 5-question survey about their experience at his business.
The customers filled out the surveys and dropped them into a survey box near the exit. This ensured that the surveys were anonymous. You will get much more honest feedback if they are anonymous.
He was shocked at what he learned from those surveys.
Among other problems he learned that his young staff was being perceived as unprofessional and unfriendly. He was hiring just anybody to fill his positions, rather than people with the right aptitudes and attitudes for each job.
He began hiring people who had friendly and professional attitudes for key customer contact positions like cashiers, and that made a world of difference.
Word got around pretty quickly that things had changed for the better and his customer base began to grow once again.
He was so committed to the survey program that he made it a permanent system -- and shared the survey results with his staff on a weekly basis.
4. Take action to improve
Once you have determined what areas of your business your customers would like to see improved, take immediate action to improve them.
Survey your customers again to see if you have succeeded.
This simple process is called 'Continuous Improvement.' Make it a permanent part of your business and you will see a marked improvement in your bottom line.
5. Ask past customers to come back
Just because you have lost customers in the past doesn't mean that they are lost forever.
A simple letter or even a post card to your past customers letting them know that you have missed them and would love to have them as customers once again, can often do wonders.
I would suggest that you include an incentive for them to buy from you again. That incentive could be a simple discount, or even a small, free gift with their next purchase.
To sum it up
While it's true that all businesses will lose customers, it isn't true that you can't do anything about it. Find out why your customers are not coming back and then take action to make things better.
By Joe Gracie with Give to Get Marketing
Article courtesy of Chris Jaeger of BuildYourWeddingBusiness.com
Some say salespeople are born as salespeople. I really don’t believe that and use myself as the logic behind my belief. Along the way I’ve practiced, I have learned from experience, and I’ve refined my sales skills almost on a daily basis!
I’ve also read a LOT of great books and here are some of my favorites.
Secrets of Closing the Sale - Zig Ziglar
Little Red Book of Selling - Jeffrey Gitomer
The Psychology of Sales - Brian Tracy
For a link to purchase these and a list of some of the other “greats” visit this link at Amazon.
Article courtesy of Chris Jaeger of BuildYourWeddingBusiness.com