Differentiate to Dominate

This is part two of my second of three hybrid strategies you can use to win against your big-box competitors: Differentiate to Dominate! You can find part one here. Strategy one, Using Data to Drive Your Bottom-line is available here.

D) Next on our list of how to stand out from your competition is to Differentiate on value message.

Imagine a triangle with the center point facing downward. On one upper point is service, on the other upper point is quality, and the bottom point represents price. You can master one point. You can be proficient in any two. You can’t do all three. Choose where you want to focus.

Big-box stores focus on the bottom point. They’re really good at low prices and no frills. But not everyone is willing to accept lower quality in order to get the lowest price. Not everyone is willing to tolerate poor service in order to get the lowest price.

Are you willing to spend a little more to get better quality and to get better service? If you answered yes, you’re not alone.

Price is a good indication of quality and several recent studies show that a majority of consumers are willing to pay more for excellent service. The numbers range from 54.4% in Xerox’s, “The State of Customer Service 2015” to 68% in American Express’ “2014 Global Customer Service Barometer” to 81% in Oracle’s 2012, “Why Customer Satisfaction is No Longer Good Enough.” And to get that superior customer experience, consumers are willing to pay a premium of 5 to 14%.

To offer your customers a better value proposition, carry higher quality merchandise than your big-box competitors and provide your customers with superior customer service. Sell the value of an item over the price of that item.

E) Differentiate on Experience in order to stand out.

Customers like doing business with the owner because they expect they’ll be treated better. You and your staff have a great opportunity to demonstrate that you truly care for your customers; that you want to build a relationship.

When was the last time you called, emailed or sent a postcard to customers to tell them that you got something new in that’s in their size, in their favorite color, or that matches something they already own? To tell them about new gift ideas? To tell them about new ways to fill their needs or solve their problems?

When was the last time you sent a customer a birthday or anniversary card?

Connect with your customers directly and via social media. Mention any perks for showing up in-store, such as exclusive offers that can only redeemed on-site.

If you haven’t done so yet, it’s time to invest in a customer relationship management (CRM) system so you can communicate with customers more effectively.

In what ways can you make your store a more fun and inviting place to shop for both the customers and your staff? How can you make shopping more than just about buying merchandise? Here are a few ideas:

  • Host an event, such as a showcase, a talk by a local artist or author, or a fundraiser.
  • Have employee dress-up day, either for one of the “Hallmark” holidays, or a more fun one like dress-like-a-pirate day.
  • Install whimsical signage.

How about your background music? Are you playing music your clerks want to hear or music your customers want to hear?

What does your store smell like? I spend about one-third of my year on the road giving talks and I’m in hotels much of that time. One upgrade many of hotels have implemented to make arriving at or leaving the hotel more pleasant is to install fragrance generators in their lobbies.

In the morning there’s an invigorating fragrance wafting through the lobby to get guests charged up for the day. At night, the hotels fill the lobby with relaxing scents to help guests wind down after a long day. Does your store smell like it’s supposed to smell?

If I accompany my wife when she’s shopping for clothes and the store doesn’t have a comfortable place for me to sit, I’ll gently suggest that we shop at a different store. Does it make sense for you to install soft seating? Have you considered serving warm cookies or making coffee available? How about customer WiFi?

Even the words you use make a difference. When you walk into most stores what’s the greeting you hear most often? Usually an insincere “Can I help you?” Well that’s no way to start a beautiful friendship.

If you want to open the door to discovering the customers’ needs and start a relationship, say, “Good morning. What brings you in today?”

As your staff gets better at proactively engaging customers there is an excellent chance it will result in more sales because your passion and your personal interaction with your customers helps them feel connected to you.

Summary

Adopting a strategy of differentiation means offering:

  • Exceptional customer service
  • Unique merchandise, attractively presented
  • A better value proposition
  • A more memorable shopping experience.

All of which helps attract loyal customers who shop with you again and again, and who tell their friends about your store.

Bob Roitblat
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Bob Roitblat

Bob Roitblat is a Leadership Capabilities Expert and TEDx speaker. He helps organizations ignite creativity, overcome challenges and capitalize on opportunities. Bob is also the president of Mainsail Consulting Group, a business-advisory firm. Also connect with Bob on LinkedIn, Twitter or Facebook.

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Bob Roitblat
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