I received an email yesterday promoting a webinar on how designers and creatives can fight against their services being devalued and confront prospects who don’t see the value in what they charge. I smirked when I heard this, because it’s impossible to do as long as design schools and institutes churn out eager kids with 2-year degrees, as long as the industry has no widely recognized credentials, as long as there are few standards that everyone has to learn and abide by, as long as instability reigns when it comes to stable employment in the advertising industry.
The design and advertising industry has very few barriers to entry. Yeah, you might need an uncle who is head of accounts to land a plum entry level gig at a big agency, but really anyone who owns a Mac and knows their way around the Adobe Creative Suite can hang out their shingle and say “I’m a designer. And I’m just as good as anyone else out there.” And it’s the prospect’s job (often a difficult one) to judge if this individual is as qualified as they say.
Other professions have a very high barrier to entry. Attorneys have to go into a couple hundred grand of debt and pass one of the toughest tests on the planet to enter their profession, so it’s no coincidence that they charge so much because they’ve got quite a debt to pay. Same for doctors, and accountants don’t have it easy, either. But they also don’t have to worry about charlatans or quacks throwing up a shingle saying, “Hey, I read a few law books. Now I’m an attorney,” who then charge 25 bucks an hour. In fact, attorneys are so smart about building barriers to entry that just calling yourself an attorney is illegal. Smart people, those lawyers.
This same principle goes for most manufacuring (it’s expensive to acquire land, facilities, machinery, raw materials and then pay people to make stuff, and it’s still costs money to contract it out to China) and even the Internet, where the barrier to entry is often ranking in the organic search listings. Google is essentially the barrier, and if you think you can game Google, think again.
So if you’re in an industry where the barriers to entry are low, maybe it’s time to think about how to build them either for your industry as a whole or specifically for your company. Patents are barriers to entry, but these are also hard to come by. Building a community online or offline can be a barrier to entry, and this might be a good place to start. It’s not easy, but once your barrier is built, you just made it even harder for others to compete with you. The trade-off is worth it.
I happend by a not-so-kind article on the NY Magazine Web site about the survival plan for Crocs footwear, and although the company has overextended itself and lost money hand-over-fist in Q1 of 09, it seems they have plans to return their roots and focus on their enthusiasts instead of, well, the whole planet.
Their scenario brings up an interesting observation about brands and how they struggle to stay popular. Some products and services like Crocs or hula hoops or Twitter are so unidimensional (which is often a good thing) that, when they hit big, everyone jumps on the wave regardless of whether they are true lovers of the product/service. So when the wave of popularity eventually washes out, those non-zealots walk out like a woman on a bad blind date. What separates these brands from other, more diverse brands like Nike or Facebook is that the latter dictate what’s in fashion and set the bar of what is fashionable and cool and “in.”
If you’re not a powerhouse brand, it’s difficult to set what’s fashionable, as you don’t have the social clout and cache to pull it off. Most successful niche brands can do it by sticking to the niche and innovating a minute category. That and they find their zealots and innovate with them in mind. The zealots are your center, and any strategy that starts with the center is sure to stay true to its roots and maintain its authenticity. And any brand that’s deemed fashionable has long before established a level of authenticity with its customers. Hopefully Crocs finds its way back to center and that its center is enough to support the brand as it regroups.
If you’ll bear with me, let’s enter a parallel dimension for a brief moment, one where there’s no health insurance and doctors and health care facilities are in a truly open market to charge as much or as little as they want. Unfortunately, a good friend of yours discovered that they must have a heart procedure performed to repair a leaky valve, and they’re considering their choices. There’s the more expensive, world-class surgeon who has successfully completed this procedure 658 times in the last 10 years, there’s another surgeon with slightly less experience who is almost as much, and then there’s the guy who has about a quarter of the experience but is half the price. Who should they pick?
Most people know they should choose the world-class doc – if you don’t have your health, what do you have, right? But in reality, quite a few will be drawn to the half-price surgeon. Hey, he went to medical school like the other two guys, he is board-certified like the other two and he does have some experience. Plus the other two docs were less experienced at some points in their careers, and look at how well they’ve fared in their profession. Plus, he’s half the price.
This is what your customers do every day. They know (or at least have a gut feeling) you’re the better choice, they understand the differences in quality and experience, and yet they are drawn to the cheaper guys. It tempts one to lower your prices or fees to get the work, especially in a putrid economy. But don’t go there, because once you discount, you will have a difficult if not impossible time moving your prices back up, and your image as a premium, top-tier brand will take a hit as well, as price is key driver of perceived quality.
Like the half-price surgeon, there’s a reason other companies are cheaper. Say your friend chooses the half-price doc, and halfway during the procedure her heart starts to go haywire in a way that this surgeon has heard of and read about but never seen, let alone treated. This is why many people pay for the best doctors, best lawyers, best designers and writers, best accountants, best engineers, best marketers. They’ve seen it all and have a wealth of hands-on, real-world experience that is irreplaceable, and they may actually end up saving you money (and your ass) many times over because of it.
So before you discount your products or services (or before you hire that cut-rate provider), consider the consequences of going cheap.
When it comes to making decisions, your customers are lazy. They don’t read your marketing materials or your Web site. They don’t take time to compare features. They make choices based on misinformation, irrational biases or bad advice from their sister Meg. They are more apt to follow the crowd and buy what everyone else buys (or what they think everyone else buys). Their choices don’t usually follow any logic, and for the most part they’d be hard pressed to tell you exactly why they made the choice they did. In fact, they will probably make up a reason after the fact so as not to appear daft or thoughtless.
It’s not that people are stupid or unthinking creatures (although sometimes they can be). They just have better things to do than research every product and every choice. So it’s your job to simplify your message and stake out your position in the most obvious fashion. Being cute or clever, using misdirection, making people work to “get” your message, all these only make it easier for your customers to ignore you.
Sure, there are those few who will read the fine print to decided between Brand A, B and C, so make sure you give them the opportunity to find it on your Web site. But for the rest of us, announce your position with a modicum of words and hit us between the eyes with them. They still may not choose you this time, but you have probably improved your chances for the next go-round.
Confused? Let me explain …
People who are specialists are perceived to do one thing really well. The hand doctor who repaired my torn ulnar collateral ligament (UCL; i.e., skiers thumb) holds himself out to be a hand-and-digit specialist. He has attended college, then med school, then served his residency, then probably served in some sort of post-residency program under another hand specialist, all the while learning about carpals and metacarpals and learning how to fix them. He has many years in his own practice and has performed thousands of surgeries and procedures (in fact, before he performed my surgery he couldn’t even tell me how many UCL surgeries he had done because he had lost count). Even in how he spoke to me, in relaxed, reassuring tones, I could tell he loved what he does and had every reason to expect that my thumb would turn out like those he had worked on before – perfectly healed and functioning within 5 months. I never doubted him, and my repaired thumb now works better than the other one.
So, after knowing all that about this doctor, if a friend told you that he was also one of the area’s experts on breeding bull terriers, you’d probably believe it.
Why is that? There’s nothing about what I have described to you to indicate he knows anything about bull terriers, or even dogs for that matter. And even if I did mention he had a pet, there’s a huge difference between a pet owner and a master breeder who has volumnous knowledge about a certain breed.
So why did you believe it?
Because once someone is seen as an expert in one thing, it’s easier to believe that they could become an expert in someting else, that they have the ability, intelligence and drive to develop another expertise. You figure, they have the knack to become an expert in one thing … why not another? It certainly seems plausible.
Here’s what this has to do with branding. Most companies feel compelled to say they can to 500 different things really well, but most people roll their eyes at such claims. That’s because nobody can really excel at 500 things, and because such broad-based aptitude is rare, even if you could do 500 things really well, very few people would believe it.
However, it is easily conceivable for a company to do one thing really well, and it’s much easier to prove this than showing you can do 500 things well. And once you have earned a reputation as an specialist in one area, suddenly people are more apt to give you the benefit of the doubt if someone were to attribute other abilities or talents to you. Suddenly you have become overrated by the marketplace. And this is a good thing, because you don’t have to brag and boast how multi-talented your company is. People just assume it because you are a specialist … an expert.
Note: This blog was inspired by a conversation with Jeff Calderone, the very sharp and always insightful owner of Denver Web strategy firm Elevated Third.
If you run a business or own a company, at some point you will be the unsafe choice, and maybe you have already been.
It goes something like this. The customer/prospect is considering three choices. Choice 1 is the customer’s regular brand, but she is a tired of the same-old same-old and is looking to make a change. Choice 2 is her best friend Cindy’s favorite brand. Cindy has been working on her for years to make the move over to Choice 2, and frankly, the customer has a bit of a soft spot for Choice 2.
You are Choice 3. The customer has heard good things about you; in fact, she has done her research on you, asked around, even tried you out, and she secretly thinks you might actually be the best brand of the three. But you are also the least safe choice. She knows Choice 1 intimately well, and Choice 2 is the trusted brand of her best and most trustworthy friend. You, on the other hand, have no strong personal bond with her.
So how do you overcome being a risky choice? You could offer a full money-back guarantee to alleviate any fear of making a bad economic decision or of poor performance. However, even if they get their money back, sometimes there’s opportunity costs in making the wrong decision (lost time, lost resources, damaged reputation, etc.). And plus nobody likes to be wrong.
You could introduce them to your current customers and hope their loyalty for your brand somehow rubs off. But it’s always easy to roll out your biggest fans, and even the worst brands have at least a few fans.
You could position yourself this way: not choosing us would be the worst possible decision you could make. As we just said, nobody likes to be wrong or look stupid. So maybe you could pull out all the proof of how you are the smart choice, the logical choice, the automatic choice for so many people in their situation, that it would be foolish for the customer to consider anything else. Thus they would choose you by process of elimination.
That sounds all fine and dandy, but it’s also very tricky, because this customer has an attachment to Choices 1 and 2, and tearing them down might offend the customer and make them defend the other choices, making your position even more difficult.
Or you could change the rules so you and Choices 1 and 2 aren’t even on the same playing field. Changing the rules means you are playing the game in a fundamentally different way. Everyone else competes on price; you compete on speed. Everyone else sells through distributors; you sell direct-to-consumer. Everyone else offers 26 different product varieties; you specialize in three and have an obsessive dedication to improving these three every day. See where I’m going with this. Changing the rules isn’t easy, but it may be the only way you stop being a choice and become the only option.
Lately I’ve been busy with a little side project – building the online brand for an wedding planning software web site – and one of the things I’ve been doing to get some traction and generate some interest is to contact bloggers who write about wedding-related topics and see if they will look at our site, give us their feedback on it and, if they like the site, mention it to their readers. This has been a fairly effective way of driving up our daily unique visitors as well as currying favor with the search engines, and it reminded me that often the best marketing isn’t done via the marketing department.
One of the bloggers who just loved our software devoted an entire blog post to it, and while some of the bloggers who wrote about our software used some of the language from our site to describe it, this particular blogger came up with her own slant on our site, in glowing terms, no less. After she posted the blog, she emailed me saying the post was up and asked me if I would like to change anything about it.
She described our software in terms that I couldn’t have used without sounding pathetically self-aggrandizing, but it worked because this was coming from an objective audience and a fresh set of eyes. In addition, she pointed out features of our software that seemed minor to me but were indispensable to her. In the end, not only didn’t I change a word she wrote, but I ended up asking her if I could use her copy on our site to market our software.
So next time you’re trying to launch a brand or tweak your marketing message, think about giving your customers the microphone and let them speak freely. The results may take you somewhere unexpectedly rewarding.
I should probably call this post the genius of incremental product development … here’s what I mean.
At a luncheon today I heard David Charmatz, the SVP of Product Planning and Development at Starz, speak on what the media consumer of the future, say 2012, will be like. David’s talk was very illuminating and, according to his research, tomorrow’s media consumer won’t look so dramatically different from the consumer of today. Sure, more people will be using DVRs and on-demand programming a few years from now, but the large majority of viewers will still be watching regular old cable programming for the forseeable future. As David said, people change their habits very slowly, so don’t expect everyone to flock to the newest technologies, because on average it takes 9 times longer for the general population to adapt to a technology than it did to invent it in the first place.
This all leads me to the genius of incremental product improvement, incremental innovation, incremental marketing. The big names in technology over the last several years – Google and Facebook, for starters – didn’t make their billions by creating a groundbreaking, fundamentally new technology. They basically made incremental improvements to an existing idea and positioned themselves as a grade better, a bit smarter, a little sharper, a tad more friendlier, than the other guys.
I see many fledgling startups and small businesses hanging their hat on the next groundbreaking technology or game-changing product. That’s great if you’re a gambling man and have about a decade to wait until people adapt. Instead of charging ahead with your “groundbreaking” message, consider scaling it back so your offering isn’t 3 steps away with what people are familiar with, and bring it back to their current frame of reference so they can relate to it better. You don’t want a product people will ooh and ahh at and then think it’s beyond their needs right now; you want a product the can see themselves using and buy.
I’ve been talking to lots of vendors in the marketing industry, and everybody has been saying the same thing for 6 months now. Everybody has cut their budgets to nothing, nobody is doing any work. And this isn’t just select vendors … it’s practically every vendor and competitor I know. Many of them have either curtailed their sales and marketing efforts or are halfheartedly applying themselves because of lack of anything better to do. Although I can’t blame them for taking it on the chin like this, there’s a silver lining that everyone seems to be missing in this scenario.
If nobody is contracting out any work and everybody has frozen their budgets, then right now you are on a much more level playing field with all your competitors, even the ones who are the incumbents. Look at it this way … they aren’t getting the work right now and neither are you, so why not set up appointments with all the prospects you couldn’t land beforehand just to say hello. Chances are better than even that they are in a holding pattern themselves, and you might have an opportunity to strike up a conversation with them and plant a few seeds. In the past, they weren’t even interested in talking to you, and amazing things can happen when people start talking and their mind starts opening to new ideas and alternatives.
Hey, it’s worth a shot, and it’s better than Tweeting your friends all day about when this recession will end. You don’t have control over that, but you can control what happens when we start to come out of it, and that will happen eventually.
Sometimes we get so occupied with how we look and sound, with following our diligently plotted out plans, that we often end up sounding canned and insincere. Unfortunately, many marketing communications efforts are so dry and lifeless that it’s no wonder they fall flat when they are launched. The causes of such insipid marketing are many. Too many cooks in the kitchen. Managers who hold on to the reins too tightly. Adherence to a very old way of doing things. Or unwillingness to stray from the all too tried-and-true.
So instead of trying to reverse all wrongs and change your entire marketing demeanor overnight, start by simply being genuine in your everyday interactions. Instead of giving customers a canned response to a question, talk to them in your own words. When you are responding to an email, instead of sending out a boilerplate response, write a short note that accomplishes the same thing.
By being real and genuine in small encounters, you can get instant feedback on how people react to you and the content of your messages, and this gives you something to build on when you look to tackle bigger challenges (like, say, overhauling your Web site or rethinking your mission).
