Markovsky On Adding Value: When Your Company's Brand Becomes A Reason To Buy ... They Will!
From the outset, we said that this column would be dedicated to discussing ways of adding value to the sales relationship. When value is added, it enhances customer affinity and slows the deteriorating effects of commoditization and price wars. Up to this point, we¿ve discussed what has occurred in most wholesale distribution markets, how it happened and, generally, what can be done about it.
Last month we discussed the merits of a broad product offering and ways of maintaining the specialized support that customers demand, as you endeavor to broaden your offering. Once your offering is rationalized, you can then consider how you will portray that offering and yourself to your customers and prospects.
When done properly, your product offering (and its associated attributes) and your company¿s attributes (recognized added-value, etc.) are wrapped up in a convenient shorthand, known as your brand. Simply mentioning that brand name will bring to mind the attributes an individual associates with it. This is a critical point, because people buy brands in both consumer and business transactions. If your brand is strong and customers/prospects hold a good opinion of it, you have the best chance for consideration. If on the other hand, your brand is considered inferior, you lose ¿ without much, if any, consideration.
Before you dismiss the whole ¿brand thing¿ as being, perhaps, removed from the realities of running your business on a day-in and day-out basis, consider this: The average grocery store carries about 40,000 SKUs and the average patron family operates using only about 150 of those SKUs. If one had to consider all of the brands offered in each product category, you could spend your whole life inside the store! So, we wheel our carts up and down the aisles and only half-consciously select the brands for which we have a particular affinity. When we need what we consider to be a commodity product, say paper plates, we buy the one that¿s on sale (read: best price).
This column proposes that the exact same dynamic occurs with your B2B customers. They will buy the brand for which they have a particular affinity. It¿s up to you to carry the ¿right¿ product brands. That¿s a given. But, what about your company brand? B2B customers will buy from a distributor whose company brand they associate with particular positive attributes (read: professional operations and value-adds). If you can offer them a company brand that makes a difference to them, that¿s a competitive advantage that can¿t be equaled. Think about it!
Best PracticesHere are this month's Best Practices. Readers are encouraged to send in their own proven practices, so we can share them with others.
9. Position yourself with the strongest possible "Value Proposition."
A "Value Proposition" is your company's solemn promise to your customers of what you will deliver, by way of products, services and an ongoing relationship. Your value proposition should be a reasonably short, concise statement that captures the essence of "who you are, what you do and how that is different and better than your competition."
It's always an interesting exercise to ask employees why customers return to your business. That can be a starting point, but value propositions need to be more than just some things you usually do "right." Challenge your organization. In effect, your value proposition can be viewed as your argument for why you believe your business will survive in these changing times.
10. Obtain and evaluate candid feedback from your customers and employees.
When Fast Forward Strategies does brand evaluation work, we typically perform separate brand attribute assessments with the executive management team, a group of employees and then a group of customers. Contrasting the three groups' perspectives of what the company's brand(s) stand for is almost always an eye-opening analysis. Smaller businesses can take a similar approach. It doesn't have to be highly structured - you just want to discuss the strengths and weaknesses of the company's brand and find out what each group believes you deliver. Why do people do business with you? How are you better than your competition?
You'll probably get some surprising answers - and be ready for wide differences in the responses from the three groups.
The results of this effort will enable you to determine "who you are today," what changes you need to make in the perceptions people carry about your business and what, specifically, you should be communicating to your marketplace.