Do you know about the four Ps of marketing – Product, Price, Place, Promotion? They are in that order for a reason.
The problem most small businesses and entrepreneurs make is that they do not spend enough time on the first P – the Product. They get anxious and excited and jump right ahead to the next three. Then, when the business starts to fail, they automatically think the problem must be their price, where they are selling, and/or their marketing efforts.
But more than likely the reason the business is failing is because they didn’t make sure that the product/service they were offering was:
- Better than the competition
- Different than the competition
- Answered a need in the marketplace that competitors were not
Particularly if you are a late entrant into an over crowded market, your business has to have at least one of the above to have any kind of success.
Real Business Case Study
I had a client a few years back wanting to open a cupcake business. The problem was, the cupcake business was already thriving and full of competitors doing a great job. But she was determined and jumped ahead and started designing the website, logo, marketing materials, etc. I had to reign her back in and have her focus on the cupcakes before committing to anything else. If she was going to compete in this already crowded market, the only way she was going to have success was to offer cupcakes that were better, different and/or answered a need in the market that no other business was addressing.
Research the Competition
Your first step in developing a successful business is to research your competition in terms of what they offer. I researched her competition, noting:
- The look of her competitors’ cupcakes – were they regular size, oversized, mini, mile high icing, round, square, in shapes, decorated, etc.
- The taste of her competitors’ cupcakes – were they moist, decadent, rich, not too sweet, something I couldn’t make at home, etc.
- The special types of cupcakes her competitors offered – peanut-free, gluten-free, flavors tailored to men (beer cupcakes), specialty cupcakes for sports teams, companies, weddings, etc.
If her cupcakes didn’t taste better than anyone else’s, look better than anyone else’s, and/or address niches the other companies were not, there was not much point going forward.
How to Make Sure You are Better Than the Competition
My key advice to every business is always this: match your competitors feature for feature, and then go beyond that.
Make a list of every feature your competitors offer, and then compare to make sure you are matching them feature for feature. Now, how do you go beyond? Find out what they don’t have that customers want or features where they are weak and customers have complained about.
One easy way to do this is to read reviews of your competitors on Yelp – a great place to get this information. You can also reviews of similar products on Amazon, again, focusing on the negative reviews to see where a product and/or service is lacking and you can take advantage. There are many other ways, but I have to save something for my consultations 🙂
Making sure that your product and/or service offering is better than the competition and/or offers something different from the competition and/or covers sought-after niches in the marketplace, is the first and most important step in ensuring the success of your business. Do not proceed with any of the other Ps, until you have that perfected.
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© 2012-2014 Gail Oliver. All rights reserved.