I call on many prospects who already might have what I’m selling( Please take a general view – I mean they might be using spread sheets while I’m selling accounting software). I always need to design ways through which there is enough incentive for them to move to my product or service. Sometimes, I have ideas which are successful and I loose in some attempts….
Seth Godin explains and I totally agree on how we need to do this ——-
When the factors that matter to me are processed through my worldview and compared against the options I’m aware of, I will choose you when your advantages are greater than the competition, provided I believe that you’re worth the cost of switching.
Matter to me: Not matter to you or to the next guy, but matter to me. That’s all I care about. (Example: it might mean more to me that my friends use your product than it does that you’re cheaper).
Worldview: Based on the way I see the world, the assumptions I make, the truth that I believe in. (Example: If I don’t trust young people as a matter of course, I’m not likely to choose you if you’re young, all other things being close).
Options I’m aware of: If I don’t know about you, you don’t exist.
Switching cost: The incumbent gets a huge advantage, especially in high cost/high risk/network effect instances.
Some of the ways you might build or maintain a competitive advantage:
- Access to hard-to-replicate Talent
- Hard-earned skills
- Higher productivity due to insight or organization allowing you to be cheaper
- Low cost of living for you and your staff allowing you to be cheaper
- Protected or secret technology or trade secrets
- Existing relationships (switching costs working in your favor)
- Virally organized product and organization
- Large network of users already and a network effect to support you
- Focus on speed
- Monopoly power and the willingness to use it
- Unique story that resonates with the worldview of your target audience
- Shelf space due to incumbency
- Large media budget
- Insight into worldview of prospects–making what they care about
- Emotional intelligence of your salesforce or customer service people
- Access to capital and willingness to lose money to build share
- Connection to community
Not on this list, at least not prominently, are "we are #1!", "we are better!" and "we try harder." Cheerleading skills are not a competitive advantage in most settings. And, with few exceptions, neither is "we are new." Also, "we are better and I can prove it," is rarely a successful argument.
Here’s what your board wants to know:
- What’s your competitive advantage?
- Is it really, or are you dreaming it up?
- How long will it last?
- Can your competition copy it?
- Does it resonate with the part of the market that is looking to buy?
- Is the advantage big enough to overcome the switching cost?
Posted by Digvijay "VJ" Singh Rathore