Customers buy from you because you are the fastest, cheapest and have the best service or some combination of these right? That’s what most companies believe but it’s just not true.
Every business believes it is special; That it has a unique selling proposition (USP) which separates it from its competitors.We are even taught in start-up school that having a USP is an absolute prerequisite to launching a new business. It’s not that it’s not important to have a USP, it’s just that it makes literally zero difference when it comes to acquiring new customers and here’s why:
Below is a list of the 5 most commonly stated company USP’s
- We have the best service
- Our product is the best
- We have the most features
- We are the cheapest
- We care the most
There’s a good chance that your business makes at least one of these claims. Choose the claim which is most suited to your business and then look how many of your competitors make the exact same claim!
You’ll see that in almost every industry there are a number of companies all saying “We are different because of X” but there are multiple companies all claiming the SAME X as a differentiating factor. How can this be?
The reality is that most companies incorrectly believe that have some component which makes them uniquely superior in some way. It’s called Illusory superiority. It’s also the reason that 80% of drivers believe they are better than the average driver. The math just doesn’t add up.
Given the above, most company owners are still adamant that they are the market leaders in one aspect or another. The point I’m trying to make is that even if you offer the best service in your industry, customer’s inherently won’t trust your claim, as it’s likely that 10 other companies are making the exact same claim.
Because prospects have never had the chance to experience your service or product customers land up buying from you because of how you sell to themrather than what you sell!
I believe there are 9 actual reasons people decide to buy from you company rather than your competitors, and almost none of them have to do with product. Here they are:
Reason #1: You sell better than your competitors
A great salesperson can make all the difference. A great salesperson can often outsell a poorer salesperson even when armed with a more expensive product with less features.
Reason #2: You are found first
One of the biggest things you can do to increase sales is be found first. Being the most visible item in a check-out aisle, being top of Google or calling a prospect back before your competitors, can often seal the deal, regardless of what you are selling.
Reason #3: You found them first
Inbound marketing is all the rage these days but outbound marketing is still incredibly effective. Sales meetings generated from outbound sales calls often have a better closing rate than meetings generated from inbound marketing. Outbound marketing usually results in a potential customer who isn’t currently looking for your type of product and therefore isn’t likely to be vetting your competition at the same time.
Reason #4: You are the cheapest on the block
This approach is not typically the greatest business model, but in every industry you will find customers who will seek out and opt for the company offering the lowest price (regardless of value offered). Every industry has this type of customer but be warned; these customers are typically the least loyal customers and will typically jump ship immediately upon finding cheaper pricing.
Reason #5: You were the most trustworthy option
People don’t buy from people they like, they buy from people they trust. Social proof, having a long list of successful testimonials or being a great teacher can all generate sufficient trust required to acquire new customers.
Reason #6: You were referred
Referred prospects are the best leads one can hope for. Being referred typically gives you an insurmountable edge which prevents the prospect from looking elsewhere
Reason #7: You have sufficient brand equity
Having a recognised brand mirrors the effect of a referral. It typically gives you an uncompetitive edge which seems to buy automatic trust and results in a higher perceived proposition.
Reason #8: The customer doesn’t know where else to look
In niche or monopolised industries, prospects typically go with whichever option seems most right and assumes not many alternatives exist. Think cell-phone contracts or your local hairdresser.
Reason #9: Your offer is significantly lower risk compared to your competitors
This is a great way to engender immediate trust without a referral or when lacking brand equity. Free trials, money-back guarantees, month-to-month contracts etc, are all often far more powerful than being cheap or having lots of features.
Having a business edge in the form of a better product or service is certainly a huge advantage when it comes to preventing churn and ensuring long term customers but it helps very little when trying to acquire new customers. I feel it is important to recognise that how one sells is as or more important than what one sells when it comes to building your business. In a nutshell, I believe the old adage of “Build it and they will come” should more accurately be expressed as “sell it better and they will come, build it and they will stay”