The Recession-Proof Business : Chapter 7
How to Win Over Customers
After you find a way to communicate with prospects in a financially accountable way, the next step is to figure out what you’re going to say to those prospects to turn them into customers.
Here’s the challenge.
People are busy. There are a lot of competitors out there – all saying pretty much the same thing. “We’re #1.” “The Best Prices in Town.” All this noise distracts people from paying attention to you and your marketing message. There’s spam, billboards, cellphones, regular phones, email, faxes, junk mail, radio, TV … you get the idea.
What you communicate to your prospects must cut instantly through all the clutter and explain clearly in just a few seconds why they should do business with you instead of with a competitor.
In a recession, the problem gets even worse as all the major forms of media are flooded with negative news about the economy. This not only adds to the marketplace noise but it causes fear and hesitation in the minds of many buyers.
That is why the ability to create a powerful message that gets noticed is an incredibly powerful competitive advantage. The strategy I’m about to reveal to you has been a key weapon in my marketing tool bag for years. It’s simple, powerful, and easy.
The secret to making a prospect completely ignore your competitors and do business with you instead is to make the prospect a “Unique, Compelling, and Credible Promise (UCCP).”
I’ll elaborate on this powerful UCCP formula in a moment and explain how using this formula can allow you to dominate a market. But first, let me show you why the key to dominating a market is being able to go head-to-head against a competitor for just one prospective customer – and win nearly every time.
Imagine that you and all your top competitors are competing for just one customer. Let’s call her Mary.
Here’s what Mary is going to do.
She’s going to call your office, visit your place of business, or browse your website (or however you typically do business). She is going to make contact with your business, spend three minutes learning about what you have to offer, and then repeat that process with all your competitors.
Your job is to make sure Mary picks your company as the overwhelmingly obvious choice that she should select.
I call this the “Mary Test.”
Forget about marketing, market share, competition, and all that stuff. The goal of your marketing is to win Mary over 9 times out of 10. It’s that simple.
If you’ve figured out a way to win Mary over 9 times out of 10, it’s actually very easy to multiply your success across more and more prospects.
If you can win Mary’s business, you can certainly win John’s, Clara’s, and Bob’s business too. But if you can’t win Mary’s business, you’re going to be destroyed in the marketplace.
The key to this secret is to focus on winning over just one prospect when you’re competing head-to-head with your top competitors.
How do you do this?
Here’s the formula. You want to communicate the following to Mary:
Communicate a promise of what she’ll get by doing business with you. That promise needs to be unique (and different from that of your competitors); it must be compelling (and provide a huge benefit that she actually wants); and it must be credible (meaning you must be able to prove you can deliver on that promise).
Let me walk you through each one of these.
First, to win Mary over, you need to make Mary a promise. That’s the first step. Most companies never make their prospects a promise – so they don’t get many prospects to become customers.
The second step is to make the promise a unique promise.
Here’s a simple exercise. Pick up the local Yellow Pages and flip to any section with a lot of listings. Look at the ads. You’ll notice something – they all look alike. First, most of the ads are image ads that are nothing more than a glorified business card. Second, (and more important), those ads all say the same thing. “We’re #1,” “We’re the best,” “We treat you right,” etc.
It’s impossible to win Mary over if what you promise is the same as what all your competitors are saying. Mary has a lot of options to choose from and when you and your competitors all look the same, there is no reason in particular for Mary to choose you over a competitor.
How to Make Your Promise Unique
Here’s how to make a promise unique. Every promise consists of five components that make it either unique or similar to other promises.
Here are the five components of every promise:
- Whom you’re making the promise to
- What you’re promising them
- Where you plan to deliver that promise
- When you’ll deliver your promise
- How you’ll deliver your promise
To make your promise unique, simply change one of the five components of your promise.
Change Who You Are Targeting With Your Promise
Let’s start with who.
This is an easy one – simply specialize in whom you serve. If you’re an insurance broker selling to anyone and everyone, you can specialize in serving small businesses. You can tell your prospects that you specialize by exclusively serving small businesses. If you’re competing in a field of insurance agents who are all serving small-business owners, you can specialize even further and focus just on restaurants, retail stores, or any one of a number of niche industries. The more specialized your target audience, the more compelling your promise automatically becomes.
If you own a pizza restaurant, rather than compete with the millions of pizza places out there, you can shift whom you serve to another audience, such as kids. Your pizza place only specializes in serving kids who want to have fun. Chuck E. Cheese did this amazingly well and after decades of searching, I have yet to find another pizza place trying to compete with them for the kids audience.
If you’re a doctor, you can specialize in serving a particular demographic group like Spanish speakers. The Hispanic market is one of the fastest growing demographic markets in the United States right now. Many large companies have formed entire divisions just to serve this market. If you have the skills to do so, there’s no reason you can’t too.
Babies “R” Us specializes in selling toys, supplies, and other things needed for babies – and only babies.
USAA is an insurance company that specializes in providing insurance to members of the military and their families.
The AARP – American Association of Retired People – originally started out as an insurance company that exclusively served seniors. It did such a good job catering to that audience that most people mistakenly thought it was an association long before it made the actual transition.
The list goes on and on. The advantage of picking a very specific “who” is that in less than 15 seconds your prospects can instantly understand and appreciate the advantages they will receive by doing business with you – even if everything else you have to offer is the same as your competitors. Just the fact that you specialize in serving a very specific audience has a very powerful effect in attracting prospects of that type to you.
Change What You Are Promising
Another way to differentiate yourself from your competition is to change what you promise to deliver. In the auto industry, a few smart auto dealers are bundling prepaid maintenance with all the cars they sell. Rather than sell a car and let their customers price shop on the Internet and with all the other dealers across town, they sell “Zero Hassles, Zero Repair Bills, Zero Car Wash Bills, Zero Oil Change Bills for two years.” While every other dealer in town is selling cars, they’re selling “no hassle transportation” at a fixed price with no surprise repair bills. All oil changes, routine maintenance, and car washes for two years are already included. That’s a great example of changing what you promise to your customers.
Sometimes you can promise your customers less and turn that into a benefit. One of the fastest growing grocery store chains is Whole Foods. It specializes primarily in stocking organic fruits and vegetables. Its promise is that it provides you and your family with fresh produce without the pesticides that are normally used by farmers who supply competitive grocery stores.
As traditional grocery stores started expanding their organic food sections to compete with Whole Foods, Whole Foods responded by morphing its own promise to keep itself unique. Instead of just promising organic foods, it now promises “locally grown” foods. My guess is its competitors truck their produce halfway across the country, whereas Whole Foods doesn’t. Because of this structural difference that makes it hard for competitors to change, Whole Foods is going after the “locally grown” promise. But that promise is unique, and only time will tell if customers find the new promise compelling as well.
One benefit of making what you promise different from your competitors’ is that you can charge more money for what you have to offer. Actually, this is true whenever you make your promise unique (whether you differentiate via the Who, What, Where, When, or How).
For example, our family shops almost exclusively at Whole Foods. But when my wife and I did the math, we realized we were spending nearly double the amount we would have if we had just walked across the street to shop at a conventional grocery store. We do so because we happen to value what they promise -apparently a lot more than just money! Many of our friends (who also have young kids and don’t want them to eat pesticides) also shop there. We even have a nickname for Whole Foods. We call it “Whole Paycheck” because of how much more things cost. Yet we still love it, still shop there, and still recommend it to others. That’s the power of making a promise unique – just make sure what you promise is very different from what your competitors do.
Here’s another example. Dell Computers sells all of its computers through direct mail, via the Internet, and by telephone. I’ve noticed more recently that to compete more effectively with local stores that offer to set up the computer for you in your home, Dell also offers “in-home installation” when you buy your PC online. Instead of just selling PC computers in a box, it now sells working computers that you don’t have to unpack or set up – it’s all done for you.
I have one client who’s a mortgage broker competing against hundreds, if not thousands, of mortgage brokers in his area. A few weeks ago, he asked me how he should sell an innovative new loan product that was not yet widely available among competing lenders. He was having difficulty explaining the value of this program to his prospects and was looking for help. I didn’t understand all the financial and technical jargon and I suspect most of his prospects didn’t either. When discussing this product, he was using a lot of technical language. This resulted in his prospects being confused and unclear about what he was promising and how it was different than the competition.
After a lot of digging, we realized that the primary benefit of this program was that it would allow most people to own their home outright, typically five to seven years faster than with other loan products – without any fluctuation in their monthly payment. I suggested that he talk about the program as a “fast track to retirement” program. Instead of promising X percent interest rate for Y years, he should paint the program as a way to get on the “fast track to early retirement.” After the prospects expressed interest, he could explain all the technical mumbo jumbo. The mortgage industry is very regulated, so at last check he was looking into any restrictions there might be on how he communicates his promise to his clients.
The lesson in all this is that changing what you promise can instantly make your promise to customers unique.
Change Where You’ll Deliver What You Promise
Another way to make your promise unique is to change where the customer gets to enjoy the benefits you promise.
Here are several examples:
In the dry cleaning business, everybody seems to compete on price. One dry cleaner I know of deliberately charges more, a lot more, per item than any of his competitors. He is successful with the higher prices because, unlike his competitors, his company will pick up at and deliver your dry cleaning directly to your front door. For a lot of people, the hassle of going to the dry cleaner to drop off and pick up clothes is a big pain. For these very busy people, they now have the option of completely eliminating that hassle from their lives.
Subway is one of the fastest growing fast food franchises in the world. In its first seven years or so of existence, it exceeded the number of locations that took its competitor, McDonald’s, more than 50 years to establish. It did this in part by promising its customers access to fast food in locations in which McDonald’s was not legally allowed to operate. As I understand it, McDonald’s and other similar fast food restaurants that have grills require extensive ventilation exhaust systems to keep the air clean. Because of this health code requirement, only certain kinds of properties (usually stand-alone) could meet these requirements.
Subway, on the other hand, does not do any grilling. Most of its food is either served cold, heated in a microwave, or baked. As a result, Subway could open locations in tiny strip malls, inside gas stations, in shopping malls – all places where McDonald’s was not located. By changing where it would deliver on its promise, it was able to establish more restaurant locations than even McDonald’s.
Here’s a simple method for experimenting with where you’ll deliver on the promise you make to prospects. If your prospects normally come to you to do business, consider finding a way to take your product and service directly to them instead (and charge more than your competitors). You can also try the reverse. If you and your competitors normally go to your prospects, try having them come to you instead (and perhaps pass on the cost savings to your customers).
Change When You’ll Deliver on Your Promise
In today’s fast-paced world, you can often experiment with changing the speed at which you’ll deliver on your promise. Federal Express made its mark by promising to get your packages there “absolutely, positively” the next day. Domino’s made similar promises with its pizza delivered to your door in “30 minutes or less, guaranteed.”
Norwalk Furniture offers custom built furniture exactly to your specifications in a fraction of the time it usually takes for other companies to do the same.
You can often charge more for faster service because a lot of people want things now, now, now.
Ironically, you can also make your promise unique by offering to deliver your product slower than your competition. Baja Fresh is a fast food chain that serves Mexican food. Rather than prepare all of your food in advance, it only cooks it after you order it. Its promise differs from other fast food companies in two ways. First, it makes the claim that the food is better (changing what it promises). Second, it promises to take longer to cook your food than its competitors. Its argument is that it deliberately takes longer to cook your food so that it will taste better. Interestingly, it makes the “you get your food slower” promise a benefit.
You can also change your hours of operation. Kinko’s came to dominate the local print shop industry by staying open 24 hours a day, 7 days a week, 365 days a year. When I was a Stanford University student, I would sometimes finish a term paper or a résumé at 3 a.m. and desperately need to get it printed. I would drive down to the Kinko’s on California Avenue in Palo Alto and pay whatever it cost. I didn’t even look at the prices and I still don’t! I go to Kinko’s when I absolutely need something right now regardless of what time of day or night it is.
Interestingly, I’ve been tracking Kinko’s prices over the years. Originally, its prices were fairly similar to that of its competitors. As its 9-to-5 competitors fell by the wayside, I’ve noticed that the prices have crept up over the years and seem a little higher than others. Personally, I don’t care because when I want something printed urgently it is the only place I know that can deliver.
Now that Federal Express has acquired Kinko’s, it has combined this 24×7 “when” promise with a twist in its “where” promise. Now you don’t even have to go into your local Kinko’s store. You can submit your entire print job directly over the Internet and have the option of picking it up in a few hours. Or, Federal Express will deliver it to your front door “absolutely, positively” the next day, so you don’t even have to leave your house.
I hope by now you’re seeing how very successful companies have made billions, if not tens of billions, of dollars by simply making a small change in the promises they make to customers.
Change How You Deliver on Your Promise
The final way you can make your promise unique is to change how you deliver on your promises. Here are several examples of this.
Starbucks serves premium coffee exactly the way you want and with a friendly smile. You can have your coffee decaf, caffeinated, or extra caffeinated. You can have skim milk, 1 percent fat milk, whole milk, or soy milk. You can have Tall, Grande (medium), or Venti (large). It can be hot or cold. You can add flavored syrup to your coffee. If you decide to add syrup, you have multiple choices. You can add foam to the top. You can have your coffee in any one of several hundred combinations.
Rather than just serving you any cup of coffee, Starbucks creates a cup of coffee just for you, exactly the way you want it.
Benihana is a Japanese restaurant that competes against a lot of other Japanese restaurants. The difference at Benihana is that your food is cooked right in front of you. The chefs are trained to put on a show by tossing the food and using their cooking supplies right in front of you. This has the very deliberate consequence of dramatically changing what they deliver to you. When you go to Benihana, you’re not going there for dinner. You’re going there for dinner and a show. That’s the power of changing the how part of your promise to customers.
The Starbucks of the ice cream business is Cold Stone Creamery. It takes ordinary ice cream and mixes in one, two, or more mix-ins such as cookies, crumbled candy bars, fruit, nuts, and more. It is all mixed up right in front of you, on a frozen stone, and served to you with a smile; sometimes they even sing a song if you give them a tip. This isn’t about ice cream at all; it’s about enjoying an entertaining experience.
Countless numbers of small and large companies alike have built their businesses by making a truly unique promise to prospects and customers. By simply changing one or two elements of the typical promise made in your industry, you can have a dramatic effect on stimulating overwhelming market demand for your product. The keys are to alter the Who, What, Where, When, or How components of your promise.
By doing this you can win Mary over from your competitors. Keep in mind – the secret to dominating your market starts with the “Mary Test” first. You must find a way to win Mary over despite head-to-head competition from your competitors. As you’ll discover soon enough, if you can win customers over in one-on-one situations, you can easily multiply that to win customers by the hundreds and thousands.
Let me start by showing you how to make your promise more compelling.
How to Make Your Promise Compelling
A compelling promise is one that provides a big benefit to your customers – one that the customer actually wants. It really doesn’t matter what your prospects or customers need; what matters is what they want, desire, or must have. Many businesses have failed by providing what customers needed but what nobody really ever wanted.
The first key to making your promise compelling is to solve a problem that your prospect already knows he has and already wants solved.
The second is to provide not just a little benefit but a dramatic and big benefit to your customer. The combination of the two is incredibly powerful.
Let’s revisit the promise that Domino’s Pizza used:
“Fresh, Hot Pizza Delivered to Your Door
in 30 Minutes or Less … Guaranteed!”
Domino’s Pizza used that promise to build a multi-billion-dollar company from one single restaurant located in a college town. It solves a really pressing problem – “I’m Starving” – and it provides a big benefit – its promise of “30 minutes or less, guaranteed!” Now that’s a compelling promise.
The company no longer uses that promise due to some liability issues with their drivers speeding to get food to customers fast. But, despite this fact, Domino’s Pizza exists, in large part, because of its compelling promise.
Here’s another compelling promise from Costco. While Costco doesn’t explicitly make this promise, we loyal Costco shoppers figured it out on our own. “Rock bottom wholesale prices on name-brand merchandise if you’re willing to buy in bulk.” Costco is perfect for anyone who uses a lot of “everyday stuff” and wants high quality with low prices. I buy all my paper towels, toilet paper, and bottled water there. I love the place because it offers me a compelling promise, and I know exactly what I’m going to get when I go there. It’s a crystal clear, compelling promise.
Here’s an example of a promise that a company got wrong. It promised to solve a problem that its customers did not want solved. This consumer goods company was developing a universal cleanser. This one cleanser could be used to wash your clothes, clean your toilet, wash your car, or clean your carpets. Just one tub of this stuff could clean everything in your house, even you. The problem is customers didn’t want to use the same cleaner to clean themselves and their toilet bowl. Go figure!
The product did not sell well. As I understand, the company later created five versions of the product, each with a specific and unique promise. It created a bathroom cleaner to clean bathrooms, a carpet cleaner to clean carpets, and a laundry detergent to wash your laundry. Each version of this product had a unique, compelling, and credible promise that the product did indeed deliver on – even though all essentially had the same ingredients as the original product. The reinvented versions sold a lot better than the universal cleaner.
Here are two key tips to make your promise compelling:
Solve a problem that your customer already knows he or she has, wants to get solved, and is willing to pay to get rid of.
Solve that problem in a powerful way and provide dramatic value in your promise.
How to Make Your Promise Credible
Using this approach, you’ve communicated a promise to your prospect. You’ve made sure the promise is unique and compelling. Now you want to make your promise as credible as possible. This means you need to provide easy-to-believe proof that you can deliver on your promise.
There are several ways to provide proof. Here are a number of them:
- Show testimonials. Show Mary dozens, if not hundreds, of testimonial letters.
- Be specific. If you have the best selection in town and in stock, prove it. Tell Mary exactly how many items are in stock: 45,237 items in stock all the time is much more credible than “best selection in town.”
- Give a compelling reason why. If you have the lowest prices in town, you’d better be able to explain why you have the lowest prices in town. Everybody else uses a middleman – you cut out the middleman and pass the savings on. Or you’re located in an out-of-the way location that has much lower rent, and you pass the savings on – all she has to do is drive an extra 10 minutes.
- Offer a guarantee. Offer a money-back guarantee. If you fail to live up to your promises, offer to refund her money. This is a powerful “put your money where your mouth is” type of promise. If your competitors make the same promises as you, but you know they can’t deliver, guarantee your results and you’ll win.
(If you’re really, really gutsy, offer a double- your-money-back guarantee. I tried this once on a particular product and I doubled my net profits. My refunds did go up a little, but my sales more than doubled and compensated for the refunds with a bunch of extra profit to boot.)
Obviously, you really had better be able to deliver on your promises or you shouldn’t do this – but it’s a very simple way to separate yourself from the competition.
To recap, to win over a single prospect, Mary, in direct head-to-head competition, make a Unique, Compelling, and Credible Promise.
It’s vitally important to focus on winning over just one customer at a time, because that’s how the battle for market dominance is won.
The key to winning new customers is to make them a Unique, Compelling, and Credible Promise that answers the question, “Why should I do business with you instead of with your competitors?”
When you have a good answer to that question, you’re ready to roll out your promise to more and more people.