How To Differentiate, Execute And Win Against Your Competition

How To Differentiate for Core Customers
IT solution providers need to offer products and services that "Wow" their core customers – those 20 percent of clients that provide 80 percent of revenue. Consider making changes for your core customers only. As an example, Thean cited Southwest Airlines. Southwest has a unique model. It offers low fares that attract core customers -- people who might otherwise ride the bus.

The catch is that in order to obtain a preferred seat, passengers must arrive early and wait on a line, just as they would at a bus depot. Potential customers who are chronically late and have hard and fast seating requirements would have their complaints about Southwest's procedures fall pretty much on deaf ears -- those people do not make up this airline's core customer base.

Identifying who exactly the core is, is crucial. "The core customer is a person, not a category," said Thean. Once the core is identified, focus on that group's needs, not wants. Needs are must haves; in a recession, a customer will pay for needs, not wants. It's similar to the difference between wanting vitamins but needing medicine, Thean explained. That's where brand promise comes in.

"At the tip of the iceberg is brand promise," he said, which includes marketing and sales. "Below the water line are activities and measuring. Brand promise is what everyone sees, but if you do a bad job fulfilling on your brand promise, you can lose your core customer. You don't want your brand promise to become just a tagline. Taglines don't differentiate you."

How then, can an IT solution provider build something different and make their businesses remarkable? Thean recommended Hide a Dagger Behind a Smile, written by Kaihan Krippendorf. Basically, the author notes that grand chess masters have 10,000 moves compared to the average player, who has about 1,000. Grand masters win because they have more patterns memorized that they can use readily. Thean offered three patterns that many entrepreneurs have not thought about:

1. What is the competition not willing to do? In the case of Southwest, the competition was not willing to give up standard boarding procedures. By not following those procedures, Southwest gets more airplanes off the runway.

2. What do customers hate? They hate when a service doesn't go as expected. Thean gave an example of a hosting company that pays customers if their sites don't migrate properly.

3. Figure out if your company has an inherent asset built into its DNA.

Next: Executing Your Business Strategy

Executing Your Business Strategy
Executing on a brand promise is simple -- but it's not easy, Thean said. First, discern what your company's key activities are. What do you do better than anyone else? Then, determine how to measure your actions, so you know you are fulfilling your brand promise. Company employees are constantly busy, often stretched thin. It's important to measure, said Thean, to be sure that all that energy is not being wasted running toward the wrong target.

Thean is a fan of dashboards; visual aids that are publicly posted that help employees and management face reality and make improvements on their own. Such systems encourage self-correction; employees that self-correct -- rather than have a manager tell them what is wrong and how to fix it -- save time and money.

By employing a simple red, yellow and green scoring system, managers can tell at a glance whether customers are buying products and services because of brand promise; whether it has been easier to generate sales because of your brand promise; and if customers are seeing your unique brand promise or are just reminded them of another company.

Using Guarantees To Win the Business
"How do you compel a customer to buy?" asked Thean. The answer: Reduce his or her risk. That can be done through the use of a guarantee. In the earlier example of the hosting company, if the data was lost during migration, the customer got money back.

Another more well-known guarantee was given by auto maker Hyundai back in 2009. Buyers who had financed cars could return their vehicles, at no cost in most cases and with no penalty to their credit rating, if they lost their job or income within a year. Hyundai took the risk away from the customer. Most companies are hesitant to do that because they look at the worst-case scenario: What if all buyers lost their jobs?

That type of extrapolation is unrealistic, and prevents companies from making innovative offers that entice customers to buy, Thean said. Remember: Guarantees are one of those things that competitors don't like to offer, and so will differentiate your company as one that is truly trying to make life easier for customers.