Meaningful Differentiation For Service Providers

Services vs Products

Often I get asked about differentiation and how much easier it is to in products rather than
services. Well certainly it is a great thing to do in products but I can categorically state that it is no harder
to do in services but simply following the very same principles that make it valuable for products.

Meaningful Differentiation

Regardless of whether we are talking about physical products or services, the guiding principles are the same.

Namely:

1.       That the point of difference must relate to the unmet need.

The unmet need examines that part of the customer need that remains unmet. It reflects the area of dissatisfaction
that is still being felt by the customer or prospect that still carries negative consequences for them.
If a point of difference is not related to want customers want it will be seen as being of little or no value
and will therefore add nothing significant to your overall product value proposition.

2.       That the point of difference must be sustainable over time.

Even if the differentiation you come up with is directly related to the customer’s unmet need and therefore intrinsically valuable,
it will still need to have sustainability where the benefit will be able to be provided over a significant time. If this is not the case,
then the benefit being provided is not a true differentiator but rather a simple sales promotion that is finite and not really expected to
distinguish one product from another.

In The Services Sector

So applying these two key criteria let’s now examine a great example of a service provider I believe can tick both boxes and thereby lay claim to
having achieved a true differentiation in his market place.

I met an impressive Financial Advisor a couple of years ago that automatically stood out for me from others I had met.
David Perez and I spoke at length and it was clear to me from our first conversation that he had an enormous amount of information and insight not only
about our local Australian domestic market and economic conditions but also just as importantly those from overseas and specifically
how they would be likely to impact on us here moving forward.

He is obviously committed to continually working on his knowledge and therefore being able to apply it to maximise the opportunity each client has,
based on their specific financial and  personal circumstances.  

As well, being independent and therefore not being aligned to specific banks, funds or other strategic partners he is able to provide unbiased opinions that are
not designed to sell specific predetermined shares, funds or other investments, but rather advice that flows from a robust analysis that has the best chance of success
based on the best decision making processes and all the currently available data.

So the differentiation is obvious in terms of broader based and deeper levels of knowledge that is because of its source also sustainable over time to
be able to continuously provide that to all his clientele so in the end he provides a better service and can maintain it over time.

So what about your business? What are the unmet needs that are there that need to be more adequately filled to provide high levels of Value and
ultimately customer satisfaction. If you find them, you will be able to unlock the door to growth.

So until next time, good luck and good marketing.

Regards,

Daniele.

David Perez’s contact details are:  

Level 7, 215 Spring Street

Melbourne VIC 3000

P.   +61 3 8646 4000

F.   +61 3 8646 4010

M.   0430 727 250

E.    dperez@pwm.net.au

 

http://www.davidperezadvisor.com/

Safeway May Be The Fresh Food People But They Need The Brush Up Their Customer Service

National Health Scare

As most Australians would be aware we are in the midst of a major health scare with contaminated lettuce and related vegetable products being found to be the cause of a salmonella outbreak that has already affected over fifty people with the number doubling to fifty four by the next day.

With such a horrendous set of events in motion there has been an instantaneous removal of all effected products from supermarket shelves with a mass media market push for all customers to immediately return these products for a fully refund.

Item Exchange

Now against this backdrop it would be reasonable to expect that all staff are aware of the facts and managed to respond in a caring and professional manner but sadly not at Safeway.
On entering my regular store and trying to refund an opened pack of salad with sales docket in hand the sales person asked me in a condescending manner why I wanted to exchange it.

An unusual question given the circumstances of the last few days however I replied it was to do with the recall and again asked for her to exchange the item.  With this she turned away and moments later re-challenged my desire to have the product refunded saying that the shelves had been cleared and this should be OK and again in a harsh and demeaning tone.

At this point I told her in a more assertive tone this is what I wanted and that was final. To this she finally refunded the item with an inaudible grunt and slammed the  returned item on top of a closed bin as though to punctuate the end of our discussion in a manner that she had conducted herself throughout its entirity.

 Cheerfully Refunded 

Now the irony of this story is that Safeway have an exchange policy for all goods that the customer is unhappy with regardless of the cause as long as you provide the proof of purchase which of course  is very reasonable in my opinion. So for any product the exchange should be conducted in a friendly and professional manner but for issues that involve national health scares, people being hospitalised and generally gaining global attention you would think there would be even a heightened sense of care and sensibility.

In fact the internal memo sent to each store actually directs staff to 'cheerfully refund all items' without hesitation.  Well this is certainly an interesting variation from the traditional approach to customer service with a smile.  I will not mention the persons name her because she'd be embarrassed by her uncaring and petulant behaviour  nor will I mention which store it was because the rationale in telling this story is not to malign and certainly not to injure but rather to discuss what can happen to any organisation if they allow poor behaviours to creep in gradually over time.

Trend

A friend of mine is a former policeman with many years of experience who shared with me once a valuable insight that when criminals get caught doing what they do, it is rarely if ever the first time they have done it but rather the first time they have been caught doing it. This truism is validated by the fact that one in twenty six dissatisfied customers complain and the others say nothing and simply don't return.  

So today someone complained and perhaps twenty five before me didn't. If this is the case it may mean lost sales for the store and over time lost employment for some. A very high price to pay for a person whose childish attitude and lack of emotional intelligence rules her behviours.

A word to the wise. The customer is always right and that's especially true when they are right.

So until next time, good luck and good marketing.
Regards,
Daniele.




 

Five Things To Never Do In Retail Marketing

1. Assume you know what the customers needs are.

Perhaps the fast way to ensure any retailer fails is to assume you know what the customer wants.

Leading Australian market researcher, Frank Domantay (Managing Director of Decision Insights) says: “Successful businesses routinely do customer research that allows them to understand what they are doing well and what they are not doing so well.”

This research can be in the form of a survey, one on one interview or focus group. With the results directly feeding in to strategic planning for the retailer and

often being the first indication for the need to change some aspect of the business or it's product offerings.

For example a recent survey done by a local Melbourne based, medical clinic found great dissatisfaction by patients in the approach by the front office staff.

As a result, the staff was retrained on both customer relations and social style training.

2. Try to market yourself exactly like your competitors do.

To fully understand how important this point is, you need to understand that the customers need is really made up of 2 things. Firstly:

The met portion of the need which are the elements that customers are already satisfied with and secondly, the even more important unmet need, which is where the real

opportunity lies to standout from the crowd.  Now if you for example, your business follows your competitors blindly and mimics everything they do, you will basically be meeting the same met portion of the need and leaving the same unmet portion of the need.

An example of a retailer that did not follow it's larger rival's example, was Dial a Dino's Pizza. They were the first to include free home delivery and as a result differentiated themselves in a

way that not only made them successful, but ultimately compelled the market leading Pizza  Hut to buy them out or risk losing market share.

3. Take your customers for granted.

The ongoing support of key customers must also be acknowledged with incentive schemes designed to both reward and maintain customer loyalty, as well as drive demand for  future purchases.

These schemes do not need to be complex. Trendy cafe Buddha's Belly offer a simple scheme on their business card, where they offer a free coffee after 5 purchases. Simple but effective.

Larger organisations like Subway have a similar card that offers a free drink after 8 purchases of their subway sandwich. These are simple ideas that work.

It's important to remember that for a lot of businesses the 80 / 20 rule applies. That is that 20% of your customers generate 80% of your business.

The bottom line is, know who the 20% are and reward them for their support. 

4. Fail to strengthen areas you have identified in your business as weak.

There is do doubt that a business is only as strong as it's weakest link.

You may have a great product but if it is incorrectly priced, poorly promoted or not consistently available in the store due to unreliable suppliers, it will fail.  These or any other ongoing weaknesses must be promptly addressed to ensure the businesses ongoing success.

For example, critically acclaimed 12 part mini series Camelot, after it's first 2 issues, suffered from an irregular printing schedule due to unreliable product suppliers which caused the

series to fail. Today's consumers are more aware and less tolerant than they have ever been and any on going weakness your business has that it does not seek to overcome, will translate into lost customer loyalty and sales.

5. Lose your overall perspective and work / life balance.

As important as it is to perform well and run a profitable business, retailers must always be wary that the business has the potential to take over your life and leave you with an imbalance between your work and the rest of your life. This is a complex issue but there are some key strategies that can help.

    1. Schedule time outs and honour them.

    2. Take a time management course that will teach you to be more efficient with your time.

    3. Learn the power of delegation, once you have established that an individual is capable of doing that task or role.

Summary: 

It is well recognised that many retail businesses fail in their first 5 years of operation.

Many of those who have failed, failed to respect the 5 must do's and the 5 must not do's of small business.

By following these rules, you will maximise your chances of not joining their ranks.

So until next time, good luck and good marketing.

Regards,

Daniele.