5 Ways to Kill Competition for Your Business

Is there an easy way to make the competition irrelevant? In an age with so much access to information, bombarded by advertisements and commercials, is it possible to keep the attention of your potential customers? What is the secret to help customers make an easy decision to buy? There is a secret formula that works for e-commerce, retail, bids and proposals. It is a simple formula that has worked since the days of bartering beads, beans and burrows.

1. Create Differentiation
Create differentiation within your own products or services. If you have an assortment of products or services to offer, you may have identified your differentiation already. Common examples of differentiation for products may be based on size, speed, color, components, combinations or accessories. Common examples of differentiation for services include speed, performance, quality, responsiveness, availability, ease or integration. If you are in the unique position of having only one product or service to offer potential customers then you should consider accessories, partners or other options to create a variety of levels from the perspective of your future customers. If all else fails, you can offer different levels of shipping speed or delivery.

2. Focus on the Moment of Truth
Focus on the moment of truth, the place or position that your products or services will be offered to the customer. In a retail environment this may be the end-cap, a wall display, shelf space or a counter display. On the Internet this may be an on-line store, e-bay or your personal site. It may be in a catalog or a brochure. It could even be part of an email communication. Occasionally the moment of truth may be in the form of a bid or proposal after several months of discussions with a potential client. The moment of truth is the moment that the customer has a an option to make a purchase decision, to buy your products, invest in your services or hire you. This is the moment that you need to put your good, better and best foot forward.

3. Good, Better and Best
Give your customer three options. Show them something good, show them something better and show them your best. It is a simple formula that takes a little care and creativity in crafting your message. The three offers should be based on the foundation of a consistent theme, the single most important underlying reason to invest in your products or services.

The 'good' product or service should be the lowest cost option but still demonstrate your inherent value and differentiation from the competition. You should be able to clearly define your value, the features, advantages and benefits of what you have to offer. This is the customer minimum investment to buy, and it should be a good one.

Step up to better. Using the foundation established with your 'good' offer, add something more for a slightly higher price. The customer value should be easily distinguished and highlighted as more significant than the slightly increased price. Make a clear comparison to the "good" product or service. This should be a preferred alternative for the potential customer. The option should be slightly more expensive, but worth it. Some examples may include, "with additional 1GB memory", "includes six months of Satellite Radio", "bundle package includes download of 50 songs", "50% faster than the original", and similar comparisons.
Show them your best. The third option should be the best that you have to offer, the cream of the crop. This is the most expensive option and will only be selected by the most exclusive of customers. It should also have something in common with the original "good" option and the "better" option, but the third and final option should be recognizable the best you have to offer. The price may be significantly higher than the other two options, and that is fine. Demonstrating a significant leap to a higher price point for the top of the line option will help to differentiate the cost value of the other two options. Do not expect large volume of sales on the best offer. Rather, use this to demonstrate competitive advantage and differentiation with the "wow" factor.
Even if you have hundreds of customized solutions or products, select and present three options, good, better and best. In the decision process, human beings can easily compare and contrast three options. The mind can juggle three prices and three sets of features for a quick and easy decision process. Once you add a fourth element, the customer needs to start a deeper level of analytical comparison. If you have too many options then the customer will need to spend more time to consider the alternatives, and while they are weighing your multiple options they may start to consider the competition as well. Limit your presentation to three options. If the customer makes a specific request for an alternative, then provide the alternative that the customer has requested, but avoid introducing too many new variables unless asked. The more factors in a decision, the longer the process and the more likely to turn your "Moment of Truth" into a Lapse into Confusion.

4. The Value Proposition For each option that you present to the potential customer, provide a value proposition. Your value proposition should be something that can be conveyed in three to five bullet points, three to five sentences, or spoken in thirty seconds or less. You should be precise and succinct. Present the value proposition from the customer point of view. For example, rather than say "we ship in three to five days", you could say "the product will typically arrive at your door in three to five days". Rather than say "we have the fastest process", you could say "our process is fast, so you get results faster".

A value proposition typically contains the essential elements of Feature, Advantage, Benefit, Image and Offer. This is a reference to a specific important feature of your offer, the advantage as compared to the competition, and the benefit to the customer. The Image refers to a photograph or diagram. The Image is an important element of your value proposition, as people will generally remember an image more readily than words. Images convey feeling, and typically depict a lifestyle example of the customer enjoying the benefits of the feature's advantage. The Offer is a call to action. Give your customer an offer to buy, and let them know specifically how to conduct the purchase. Examples of the order call to action are "buy now", "limited time discount" or a number to call to place the order by phone.

An example of the value proposition with the essential elements is "Call now to order the self-cleaning home brew coffee maker and start enjoying fresh, hot coffee with the extra convenience of no fuss, no muss and no clean-up. Order on-line to receive your free sample of assorted coffees, available while supplies last." All we need to complete this enticing offer is an image of hands gently caressing an aromatic steaming cup of coffee, cradled over a saucer.

5. Plan, Do, Measure and Adjust Carefully plan your three offers and the value proposition for each. Once you introduce your three offers, measure the success rate of each option by the corresponding sales attach rate. Typically the "good" offer should be about 25% of your sales, and the "best" offer is normally only 15% of your sales. Some customers will want the lowest cost option, and some will want to be exclusive and purchase the best option regardless of price. The middle of the road "better" offer is customarily the lion share at 60% of your total sales. Most customers are willing to pay a little more for quality, speed or convenience associated with the "better" offer if presented properly, even if they do not want to pay the high price of the "best" option. The "better" alternative gives customers a chance to do a little better than "good", but still feel that they saved money as compared to the outrageously priced "best" option.

If you do not experience the desired result in mix of sales then it may be necessary to adjust your plan or your value propositions. In any case, as long as the customers continue to make a selection between your options, the competition is irrelevant. Your customers can get what they want, and they will remain your customers.


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7 Mistakes that Could Drive Your Star Employees Out the Door

Your best employees are worth their weight in gold. The last thing you want is for them to quit and go to work for the competition. Be sure you aren't making one of these mistakes. 

Regardless of how good of a manager you are, sometimes employees are going to leave. Often, their departure stems from factors outside of your control but it’s still a good time to make sure you aren’t making these mistakes.

1. You aren’t paying enough- Yes, you’re a small business but your employees are working to pay the bills, put food on the table, and build a nest egg. Other factors are important but money is a primary motivator.

For employees that prove to be valuable, pay market rates or above as soon as you can. Is it understandable that you’re a small business and don’t have a large budget to pay what the major corporations pay? Yes, but asking somebody to accept less money than they can make elsewhere isn’t inviting a loyal, long-term employee.

2. You aren’t training enough- A star employee didn’t get that way by accident. They love to learn and they want to be a little better each day. What does that mean for you? Constantly give them opportunities to train. Send them to conferences, pay for a new certification, or connect them with somebody you know in the industry.

Is there a chance that you’ll invest heavily into them and they’ll take all of that knowledge to another company? Yes, but it’s a chance worth taking.

3. You aren’t challenging enough- As they receive the training, they’re eager to put it to work. They aren’t happy coming to work and doing the same job every day. As a manager, you should constantly look for a new way to challenge them. Adding more work isn’t the answer. As they solve a problem, give them a new one to tackle.

4. You aren’t respecting their time- While this is true of any employee, it quickly becomes a problem with great employees, often without you realizing. Because they’re reliable, they’re the first people you call on to take care of important tasks but you can’t overload them.

Respect their job description. Let them know that you expect them to put their family first and want them to tell you if they feel overloaded. Be careful not to burn them out.

5. You make them work 9-5- We live in a connected world. In most businesses, employees can do a portion of their work from just about anywhere. Star employees who have gained your trust can work anywhere, anytime they would like so let them make their schedule.

Sure, there will be meetings and other scheduled events they must attend (and they understand that) but outside of that, judge their performance instead of the amount of time they spend at their desk.

6. You don’t praise enough- Bad managers have the attitude that if somebody is getting paid, doing a great job is an expectation—not something special. Everybody should come to work to do a great job but if you aren’t the complimenting type, you’re likely to have higher employee turnover.

Everybody likes a compliment. At home, from friends, on Facebook, and by their boss, public recognition makes people smile and lets them know that you care.

7. You don’t ask for enough feedback- Your great employees have a wealth of ideas. If you aren’t asking for them, you’re missing out on something that could transform your business.

But more important, ask them how they feel about their job and encourage them to be honest. Simply asking and listening goes a long way but with that information, you can constantly tweak their position to keep up with how they’re evolving as a professional.

Bottom Line
Even if you do all of the right things, sometimes employees will leave. When they do, don’t hold a grudge. Give them a grand sendoff, and commit to keeping in touch. Keeping a relationship in place could be lucrative for you. What if you used them as an independent contractor for some projects? What if they send you other great employees they meet?

Just because they’re leaving doesn’t mean that they’re no longer valuable to you.

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8 Ways to Improve Employee Performance in Your Small Business

When your employees just don't seem to care about what they do and put little effort into their jobs, it's easy to blame it on the employee. Before you give up on ever finding anyone with a good work ethic, check out these eight things you should be doing to motivate and inspire your employees. 

1.  Give all your new hires a packet or written handout that explains your company, work culture, policies, and guidelines for interacting with customers, suppliers, and others with whom you do business. This sets your expectations early on. Employees really want to do a good job, but without clear guidelines they may not know what is expected of them.

2.  Establish an employee training program and delegate someone to carry it out. This will involve making your more vested employees feel more valued by giving them additional responsibilities. Have them train new employees on using the equipment, handling customer service complaints, and taking care of other routine details. A training program can go a long way to making your employees feel they are a part of a company that knows where it is going.

 3. Delegate. By giving people additional responsibilities, no matter how small, you are letting them know they are valued. Employees appreciate that, and they work harder when they know someone appreciates their efforts.

4. Once a year, have a company picnic or get-together outside of the office environment. Give your employees a chance to socialize away from work, and present them with performance incentives.

5. For every new task or responsibility you hand out (and you should increase employee responsibilities as much as is feasible), establish your expectations right up front. Manage your expectations every step of the way to ensure that employees understand your end goal and know that you are watching. You have a responsibility to help your employees grow into the best version of themselves they can be. If they see you doing that, they'll work harder to meet your expectations.

6. Be honest. Nothing builds trust better than telling the truth. If an employee isn't good at something, don't be afraid to let them know. But do show some empathy. You have your weaknesses too.

7. Don't show favoritism. Even if you have a favorite employee, don't let others see that. Treat everyone the same regardless of attitudes and employee skills. That doesn't mean you should let the bad apples spoil the bunch. Discipline when necessary, but let it be known that you'd treat every other employee the same way if the situation called for it. You'll earn their respect and their loyalty when you treat everyone the way you'd want to be treated.

8. Have a system in place for dealing with negative situations. It's not something you want to think about, but every business has issues arise from time to time. Have a plan before it happens. If employees feel like you are being arbitrary, they will not want to work for you. If they know expectations up front and the consequences for violating your guidelines, then they are more likely to steer clear of those consequences. They will work harder to please you. Go out of your way to be consistent and fair and end every negative counseling session with an action plan for improving employee performance.

At the heart of every employee is someone who feels either valued or devalued. Employees who feel valued are more likely to give you their best. Those who feel devalued are more likely to slack off or develop a lackadaisical attitude. You have it in your power as manager of your business to empower your employees to be more productive, efficient, and diligent.

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