Great article. It got me thinking of those intangibles in my marketing program that I have the hardest time getting my head around. I like the action plan you included at the end. I'll get on it today.
Market demand is magical. Consider Apple, one of our most recent national market demand success stories.
Apple with its iPhone has outsold RIM, the maker of blackberry smart phones, in just 15 short months. It positioned Apple as the third highest in cell phone revenue after Nokia and Samsung. Apple had predicted they would sell 10 million iPhone by the end of December 2008. They sold 10 million iPhones by the end of September 2008. There were plenty of critics and naysayers along the way and Apple proved them wrong. Here is what Steve Jobs had to say about the coming days and the place where Apple stands:
"We don't yet know how this economic downturn will affect Apple. But we're armed with the strongest product line in our history, the most talented employees and the best customers in our industry. And $25 billion of cash safely in the bank with zero debt."
Market demand is a very powerful concept. It positions you so that your customers are eager and "begging" to do business with you instead of you having to be eager and beg people to do business with you. It's a power shift to you being the one who is sought after. To start creating market demand you must differentiate.
You know the saying "differentiate or die." Inspiring market demand requires a clear strong differentiation. College courses on marketing as well as popular marketing books and seminars emphasize the importance of differentiation. Differentiation goes by several different names:
O.K., you know differentiation is important, but how do you do it? You have to identify you're unique value.
How do your customers decide to do business with you? They make their decision based on the value you offer. If they want something and you offer that something they are generally willing to buy. However, your customer has choices. Are you the only place where I can get what I want? Is there another business that offers the same or better value for less money? Customers tend to decide based on your "unique value."
Here are 4 scenarios based on your customer's perception of your unique value:
1. Business Failure - If customers perceive that you have a low level of value and a low level of uniqueness it results in business failure.
2. Fad - If customers perceive that you are unique, but they are disappointed in the value, it's like what happened to the Pet Rock. They only buy once.
3. Price Wars - If customers perceive you have high value, but you are not unique they go for the lowest price. The only company designed to win in a price war is Walmart. Everyone else goes out of business eventually.
4. Unfair Advantage - If customers perceive that you offer high value and high uniqueness you are become their #1 choice.
Start by listing out the value you offer and what is unique about you. This is an easy exercise; however, it does cause you to think deeply about what makes you unique. After you make the list, boil it down to the top 3 or 4 things that give you an unfair advantage.
An unfair advantage is an advantage you offer to your customers that is so good that it is actually unfair to your competition. If your customers have several choices and they understand your unfair advantage they will choose you every time.
Several of my clients have become market leaders in their geographical area by starting to promote, sell, and advertise their unfair advantage. It really focuses your message and gets the attention of your market place.
Being crystal clear about your unfair advantage is good, however there is more to it, you must communicate your unfair advantage in terms of your demand context.
What is demand context? I think of it in terms of what conditions are happening in your market that causes a demand for your products or services. Think of context in being part of a song. I compare context to the music, beat, and rhythm of the song and I compare the content to the words of the song. Context is what surrounds your message and makes it relevant. Demand context is another powerful concept for shaping the message about your unfair advantage.
Here's an example:
Geico can save you money on your insurance. How do they communicate it at the end of every commercial you hear 10 or 20 times a day? "15 minutes can save you 15% or more on insurance." So what is their demand context? What conditions are generally true for most of their market that is driving demand? People are generally concerned they are paying too much for insurance. That is why they are able to have a consistent focused message (that never ends) that grabs their potential customer's attention.
It is important to know your customers and what is creating a demand for your services. Talk to your customers, read books, articles, and blogs about your industry, attend trade shows, and find specialists that can give you insights into customer behavior. Your research will be rewarded.
I came across an article about Trader Joe's founder, Joe Coulombe, who ran convenience stores in California in the 1960's. His stores were threatened by the well funded 7-Eleven franchises coming into the area. He came across some information that indicated that wine consumption increased with education level. He began stocking his stores with a variety wines and products that appealed to more educated customers and located his stores to be more accessible to that demographic. The rest is history. You never know when a small piece of information about your customers will help you generate a bigger market demand.
In addition to your unfair advantage and the demand context make certain that your message is unfair to your competition.
Unfair to Your Competition
What did Sun Tzu teach us? "Know your enemy and know yourself; in a hundred battles, you will never be defeated." What do you know about your competition? What other choices do your customers have? It is important to list out the messages and choices your customers have when they are ready to buy. You can learn a lot from your competitors. The internet makes it very easy to research and analyze them.
Your goal is to position your message so that when given a choice, the people who should be your customers choose you. The final step of your quest to inspire market demand is to take all of the information you have so far and put it into a core message.
Create a simple, central message that is the big idea you want your audience to know. This core message may end up as your elevator speech, a tagline, or an introductory statement. It should put everything into perspective for your audience. One of my favorite places for a core message is in the tagline.
Taglines are important. You know Nike's tagline, "Just do it." What is the tagline for Nike's two biggest competitors, Adidas and New Balance? I've looked them up and I still can't remember. Taglines can drive market demand.
What is the big thing your customers need to know about your business? What is the one thing that kind of says it all? Here are some national and local examples. I'm certain you can think of more:
From the Dairy Association - Got Milk?
From Taco Bell - Think outside the bun.
From a local bookkeeper - We turn your passion into profit
From a local CPA - Build Wealth. Go Play.
From a Virtual Assistant - Make more money. Do less work.
A core message gives your market the biggest reason to do business with you.
Test for Market Demand
Before you make a big investment in a marketing campaign, test your core message in small ways. You can test it informally with your customers or with prospective customers. Ask for feedback and make improvements before you use it in your day-to-day marketing.
How do you know if you have inspired market demand? Your target market buys from you with little or no hesitation and your sales are increasing from the same or less marketing effort.
Let the Fun Begin
Once there is an indication from your testing that your core message works, start promoting and expanding your marketing and sales efforts to reach your revenue goals. Rework your core message as necessary to inspire market demand. Use your core message in all of your promotional efforts.
Action Plan to Create Market Demand
Here is your action plan:
1. Decide and write down the top 3 or 4 things that comprise your "unique value."
2. Decide and write down what gives you an unfair advantage.
3. Decide and write down the demand context for your products and services.
4. Decide and write down how your offering is unfair to your competition.
5. Decide and write down your core message.
6. Test your core message to make certain it inspires market demand.
7. Put your core message in all of your marketing materials and scripts.
8. Have more fun and make more money!
Learn more about the author, Kirk Davis.
Great article. It got me thinking of those intangibles in my marketing program that I have the hardest time getting my head around. I like the action plan you included at the end. I'll get on it today.
I like your thought of "those intangibles." We are all so close to what we do and we have invested so many years doing it that it is difficult to see through the eyes of our market place who know nothing about us. Dan and Chip Heath in the book "Made to Stick" talk about the "Curse of Knowledge" that keeps us from seeing and communicating through the eyes of our market. I think there is something you offer that will drive market demand for you even in this very difficult economy.
Hi Kirk, Thanks for getting me thinking about how my prospective clients see me, and for concrete ways to begin expressing my uniqueness to them. This has been a missing piece for me, and I look forward to doing the work around it. Thanks! Elise
Nicely put Kirk. The unfair advantage should be shouted from the rooftops and be blasted out of every TV set! (shameless plug). I work with business owners everyday who are passionate about their business but have not put onto paper what thier value proposition really is. Great marketing needs to start with a plan!
Great article Kirk.
Food for thought and great action plan.
They say it's all in the timing. Thank you for the clarification of unique value and unfair advantage. I've actually been working on our messaging all week and needed a little more guidance in this area. I will begin working on this today! Thanks.
I just want to clear up a few things, and I'll probably get in trouble for this.
I know I'm splitting hairs here, but some economists out there may agree. What you're talking about here is not "market demand" per se, but demand for a specific product. Theoretically, demand cannot be created, because demand has to do with consumer behavior and it takes some exceptional circumstances to change that. The wireless phone which caused a sea change is actually a better example than the iPhone, which is an improvement over existing PDA's, but not behavior-changing (maybe more people are surfing the Web via mobile -- but that could be a factor of 2G/3G as well).
Although there are some good points here, there are several misstatements. For example, differentiation is not the same as competitive advantage. Your product may be "different" than a competitor's, but that difference doesn't necessarily give you an advantage.
Sure the pet rock was a fad, but it made millions and didn't require people to buy another one. The fashion industry deals with perpetual fads and does well with it. That's their business model.
It's important to get the terminology right. When we address these kinds of issues in our businesses, we want to make sure we're coming up with solid solutions -- not magic bullets, like promising to double or triple your business in a few years.
I could go on, but I won't, because I know I'm going to get flamed. Sorry Kirk. I like the iPhone too, but hey, you never know when someone's going to come up with something that's faster, better, cheaper. And that product won't create market demand (most likely), it will just be a vast improvement.
Wonderful advice. Putting it to use, I'd like for feedback, which do you think is better?
More than just another pretty vase. or Make flowers versatile.
Very well written Kirk.
I liked your examples. Clear and to the point. And, being an Apple enthusiast… Steve Jobs is a guy to study eh?
I am amazed by how your message escapes 90% or better of most business people. A car dealership near my town recently renovated his building.
New sign out in front reads… Walled Lakes Biggest Chrysler Dealership! Actually, it's the only Chrysler dealership. What does that mean? Does your vastness mean I get lost in the fray? Where's the differentiation?
Point is that platitudes abound! Business people would do well to follow your learned advice.
All the Best! Daron Powers
Kirk, I thoroughly enjoyed your article. I really like the exercise of writing down what makes you unique and boiling down to 3 or 4 things that give you that unfair advantage, great stuff!
Oooh ~ the Trader Joe's wine example has my wheels cranking! Thanks Kirk!
Great Article - you have a great way of presenting clear and to the point. The action plan you included is a great tool I hope businesses take advantage of. Too many businesses determine what they do by what their competitor is doing - which is usually wrong.
I look forward to your next articel.
Brian Erickson Pro Business Consulting
Your advice is right on, as usual.
As always, your thinking fits perfectly within the framework of effective branding. In a saturated market of information overload, differentiation always wins. Branding is differentiation, and design is the animating principle and visual articulation of the brand.
My mantra is that creativity and imagination are the best means of gaining an unfair advantage over the competition. Using these to develop new ideas, and create new emotional connections with consumers will propel your business forward. At the risk of sounding redundant, branding is the message, and design is the means.
Here is a quote I just discovered from Apple's new CEO, Tim Cook. It perfectly illustrates your point, and confirms why Apple is an extraordinary company. Entrepreneurs should commit this to memory:
"We believe that we're on the face of the Earth to make great products, and that's not changing. We're constantly focusing on innovating. We believe in the simple, not the complex. We believe in saying no to thousands of projects so that we can really focus on the few that are truly important and meaningful to us. We believe in deep collaboration and cross-pollination of our groups, which allow us to innovate in a way that others cannot."
Thanks for sharing.
Hi Kirk, Great article... defining my niche and turning it into an advantage is something I have been working on - thanks for the helpful tips that will help me on my path to differentiate myself from the sea of designers out there. Thank you, Kelly
Kelly Lenihan, Owner KSL Designs - Web Design for the Visionary Entrepreneur http://www.ksldesigns.net
Kirk, Your article was extraordinarily helpful! I am going to print it out so I can look at it daily and begin to implement some of the great concepts you have presented! Thank you for writing such thought provoking articles.
Having a good idea is one thing, understanding the intellectual framework that created it and will create the processes, strategies and tactics that will make it a successful idea, as well as replicatable, is another. The Apple story is good stuff - lots of lessons to take away from this product release. In fact, I have incorporated the iPhone release into several talking points with potential clients when the subject of brand extension or product release strategies are talked about. However, the problem I have with the article is that the intellectual underpinnings of the theories talked about have no basis in marketing reality.
What is being passed off as honest intellectual analysis is in fact nothing much more than a mashup of the pop marketing analysis culled from a list of the last 12 New York Times non-fiction best sellers.
Robin Block is absolutely correct in her points on market demand and differentiation and I for one whish she had continued on to probably have included a discussion on market variables and commodifying brand promotions or the fact that the release strategy for the iPhone was guided as much by considerations for grey market concerns globally as it was about being able to take advantage of the premium pricing strategy for as long as the market allowed, given the fact that Apple was commanding nearly 15% of AT&T’s operator revenue from each iPhone user.
The internet has allowed people to voice ideas and challenge beliefs in all walks of life and in our case specifically, modern business practices. The thing to remember is that you still have to use your own intellect to question and think about what is really supporting the very ideas we so often feel are “right on” when they simply sound good to the ear. The phrase “caveat emptor” still applies even to intellectual property.
Elise, I empathize. Sometimes it easy to identify a core message that inspires people to buy from you and other times it is really hard. I looked at your profile and website. In your case you have a lot of competition. Its easier when you are in front of people - you can tailor the message to the person. However, when people have to read your website or marketing materials and make a decision without you being in front of them, then having a strong core message helps. With all of the competition you have directly and indirectly (there's a lot of personal coaches out there) your core message has to resonate with the kind of people you really want to have has customers. Toya Turner is a Biznik that I thought did an excellent job with her tagline. Please look up her profile and see how she did it. I'll be interested to see what you come up with. There are a lot of great marketing and business coaches on Biznik available to help.
Doug, You know me well! I started teaching and talking about the "Unfair Advantage" three years ago. It created quite a buzz in our community. My clients who thought in terms of the unfair advantage where growing and increasing sales. Over time I kept finding things in popular marketing non-fiction books that added to the concept. You may recognize some of these concepts from the book "Made to Stick" and "Tipping Point." I read the college text books also, but nothing useful jumped out at me. In my position, like yours, I'm only interested in what works. This market demand formula has worked across a wide variety of industries and with everyone who has tried it so far. Doug is a marketing genius! I highly recommend him to help your business.
Rozmin, Erica, Cathy, Bill, Adrienne, Annie, Brian, and Marlene,
Thanks for your kind and encouraging comments. You always hope these articles can help make a difference somehow.
As I reviewed your profiles and websites I was reminded of how each business based by its business model and by the nature of its customers needs a different marketing approach. It could be advertising, location, networking, referal sources, or direct sales. Inspiring market demand helps and you have to approach customers in the right way. I sometimes see businesses try direct selling when they really need referral sources. I also see businesses rely on advertising when their business model really needs to rely on location. Another something to think about.
Cathy, you asked a question. Without knowing more I would go with more than just another pretty vase.
By the way, last night I just noticed that I HOP the pancake place is getting into the spirit of inspiring market demand - their new tag line is "Come hungry. Leave Happy."
Great article! It amazes me that simple concepts, like these, get discussed from an acedemic stand point.
In fact any economist will tell you all demand beyond food, air, water, and shelter is manufactured. That is where sex comes in. We can live without sex, but will go through any amount of torment to get it.
I think that concept of the promise of more than the basics is the essence of marketing.
This article most certainly goes to the heart of creating desire. Desire is what drives demand. Being the best choice is absolutely the purpose of marketing.
Thank you so much for commenting on this article. I like the saying if you can't raise enough passion for people to hate your product, you can't raise enough passion for people to love your product. I am always happy for dissenting and alternate points of view. No flaming here. My college professors were much more brutal in their critiques. I enjoy the comments on the articles, that's where we find the good stuff. There are hundreds of marketing and business consultants on Biznik. I'm certain many of you have better ideas on the subject, which I hope they will bring out.
Your website gave me a lot to look at. You are apparently very good at marketing!
I had to read my article again to make certain I didn't use the word "creating" market demand. I agree that it may be impossible or too expensive to create a market demand. When I talk to clients I talk in terms of tapping into market demand or inspiring the market demand to come your way. Its what you talked about as Judo Marketing. I liked that.
I find every business I work with offers something valuable and unique to their customers, but many small businesses have trouble identifying it and communicating it. The formula I use is the article isn't perfect but it has produced results.
I liked your thoughts about the fashion industry. My clients in that industry have to brand the company or the label, because the apparel quickly goes out of style. If done right the brand won't.
I think solid solutions come from having several magic bullets. Solid solutions only last as long as you can keep the market's interest or until your competition steals customers away from you. So I am O.K. with magic bullets as long as they work. That's why I emphasized testing.
I am working with a small retail store that sells the biggest name brands in woman's jeans. Due to the economy her sales are down. We worked on a core message for her demographic. The message is "Brand Your Butt." Her customers love it. They get it. She incorporates this core message in all of her marketing and what she tells customers when they come in the store. Every solution is unique. When it is tested and works with the market. You have to run with it.
If any business makes a promise in its marketing or branding that it can't live up to, it's reputation will put it out of business. I'm referring to your comment about people who promise to double or triple your sales. I couldn't agree more. In those cases, I am skeptical too unless I hear it directly from somebody who actually got the results. That's why we are enoying so much success from our Hot 100 program. I don't expect anyone to believe it until they talk to our clients and hear it for themselves. We have couple of Hot 100 clients as Bizniks.
I am looking forward to meeting you sometime. I am always looking for marketing consultants I can send my clients to. I may educate about marketing, but I rely on people like you to help my clients execute and improve the plan.
Thanks for taking the risk to speak up and speak against. I think it is good for everyone.
Jeffery, you are next.
Some thoughtful commentary has been added to this article, and I'd like to speak directly to some of it...
Robbin Block indicated above that she feels that the term "market demand" is misused here. I respectfully disagree. While a market already existed for cell phones and PDAs, there was, for a long time, a very large and clear void in that market created by Apple’s absence (we’ll forget Apple’s earlier, and ill-fated attempt with the Newton, because most everybody HAS forgotten it). Everyone knew that an Apple phone/PDA was on the horizon, and they knew that it was going to be different. They knew Apple would make it look cooler, do more, and function faster than anything else available, and they wanted it… bad. Apple-philes were demanding it, and the longer it took to arrive, the greater the demand became within the market.
The important thing to note here – and I think this is the crux of what Kirk is getting at – is that the interest in Apple stepping into this market was so high because Apple has done an extraordinarily good job at branding and positioning itself. What other company, in any industry, has positioned itself so effectively as the vanguard of their sector? The market existed for these products (phones and PDAs), but the market was demanding that Apple, specifically, provide an option. The demand was a result of effective branding. Branding manifested in the history of quality and innovation of the company’s products, the spirit of it’s message and mission, and the aesthetics of it’s products, it’s stores and it’s advertising. When you think of computing, you think of Apple. When you think of cutting edge consumer technology in general, you think of Apple – and that’s powerful.
I think that Jeffrey Summers raises some very intriguing thoughts about grey markets, and product launch. There is no doubt that the black and grey markets for Apple products are rife. I have no way of knowing, but I’d bet that Apple even tacitly encourages at least the grey market, because grey market shenanigans would certainly increase that “got to have it” brand equity that is at Apples core (sorry, had to say it). This actually strengthens the brand, and generates further demand. Any losses the company suffers through grey markets are probably offset by the value-add these same activities provide to brand equity.
Once again, all of this boils down to one word… branding. And, few companies know how to do it better than Apple.
I don't disagree about the importance of demand or branding or communicating the benefits of products, or whatever other terms are being bandied about here. What I was having trouble with was the misuse of the terms. If you were in the emergency room, would you be concerned about the difference between a radial fracture and a compound fracture, or is it just a broken bone?
Wow! I appreciate you speaking your mind. I really like your websites! I will be referring clients to you.
As I mentioned before, I like controversy and experts exchanging ideas.
I am responding to your statement: "the problem I have with the article is that the intellectual underpinnings of the theories talked about have no basis in marketing reality."
Well, I have to respectfully disagree. My articles are only based in marketing reality. The people I work with are my neighbors, I see them frequently. I can't do a bad job and then hide my face. We track their financial results monthly. If something works I keep it and spread it. If something doesn't work I throw it out. We readjust strategies until we find what works. I read articles and books because I look for new and better ways to make it easier for my clients to grow faster. So appreciate positive and negative comments.
I also would like to hear about market variables and commodifying brand promotions. Please share.
Just like you, when I speak to a client in person, I can adapt the material exactly to their situation, when I write an article the reader has the burden of adapting it to their own situation.
I'm a little surprised that with your level of expertise that my article seemed like sugar coated concepts that only sound good to the ear. I was hoping to learn how you approach the same subject with you clients. I'll bet it is good.
I still think your O.K. and I am still going to refer my restaurant clients to you.
Thanks for your comment. I like your idea of creating desire for more than the basics. Any branding, marketing, or sales effort is still a one-on-one effort to create desire. I hope everyone reading this article can more easily create that desire in the minds and emotions of their market.
Thanks, enough said.
The way you brand rocks!
I have a company that is dormant in favor of other businesses at www.rotwork.com It was a part of another of my companies Aardvark Home Inspections.
Our tag line was "Rot work done Cheap" after the AC DC song "Dirty Deeds'"
It's stupid but I was referred to as the rot work guy for years. People could quote my tag line and not remember my name.
All I cared about is that they remembered the name of my company.
So I wanted to thank you for putting this valuable information in front of people. At the same time I am concerned that it was ever questioned.
Questioning is the heart of intellectual debate. It's how we learn.
This is a simple concept being disected over symantics.
It is pretty well founded and has excellent examples.
My question has to do with the community think of biznik. I was surprised to find a rating on this article of 7.3.
Why would some one take the time to rate it low when it's a simple statement of a fact about advertising?
Thanks Robbin and David,
I agree Robbin it is how we learn, I've loved it! It certainly made this article fun and interesting for me.
The rot work guy, that is good. I appreciate your endorsement of the article. I am a little bummed over the low rating only because it is so low it won't show up on the front page of the articles section for this week. Out of sight is out of mind. I was hoping more people would see it and respond. Oh well.
I think of branding in terms of what you symbolize to your market and what you do and how you do it as the soul of your business. I get referred to as the Hot 100 guy. I have another client who gets referred to as the TV guy. It agree, it is more important that they remember your business than your name.
Awesome article. I love the examples and the action plan. I'm brand new at this (finally starting a company after freelancing forever) and this is the action plan that I need for marketing. I spent 6 years in grad school and am used to people loving to argue the small points. But it's only the bottom line that really counts (IMHO) and I think the bottom line is that this is one of the most useful articles I've seen on here. Thanks for spending the time to share it.
I also enjoyed reading through the comments and seeing what a great job you've done connecting with everyone who responded.
Wow Amy! You know how to say thanks. That was really nice. It is a very interesting and needed business you have. You could be a solution to our national education problems. We need students to excel and be ready for their next steps out of high school.
I wish you the very best. Please let me know if I can help in any way.
Kirk, I appreciate the way you laid this article out, with each phase building on the next, ending in an action plan. I actually plan to use this at my next "cafe' planning day" since I've got some re-branding to do. It gives me some good things to consider.
I also appreciate the way you respond to your positive and not so positive comments. While the article may not be "perfect" (is anyone's article ever perfect? None of us would ever post if that were the case), it's perfect for the small business owner like myself who needs a few key ideas to consider and implement.
I can see why your customers appreciate you!
This is a fabulous article. I believe it holds the key for movement, growth and prosperity. Thanks for writing this. We all need to remember and review the key components. Please keep writing and responding in your so balanced matter. In the end, balance matters.
Great job Kirk. Love the way you laid this out simply and easily. I plan to use some of these tips as I upgrade my website and blog this month.
I am glad you were able to use these ideas. Thanks for reassuring me about imperfect articles. I needed that. You are so nice in your comment I am looking forward to meeting you some time.
Thanks for your encouraging comment. I agree with you that inspiring market demand is a big key to growing any business. You have encouraged me to keep writing! I am watching a big transition with the clients I work with as they think of better ways to inspire market demand in this down economy. You have to clearly understand the value you offer and offer it in a way that they can relate to and embrace. As a result, many of my clients are growing their market share while their competitors are going away. It's not about the industry or the economy. I believe that as you business gets better it is enabled to grow faster.
Your comment about this being helpful to you is very appreciated. Thanks for taking the time to find and comment on this article. I am looking forward to hearing more about your website and blog. Your website and business name are inspiring. My goal for businesses is to speed up the selling process and influence the right kind of clients to seek you out. I wish you the best success.