Summary.
What if you could completely eliminate your competition from your customers’ consideration — would you do it? Of course, you would. These days, so many companies strive to fit into a niche that they must elbow their way past a mass of competitors to do so. Why strive to be a leader in your category when you can create a different category and be the only one in it? Such are the lessons to be learned in Becoming a Category of One. By using consultant Joe Calloway’s tips and advice, you can avoid being“commoditized” and differentiate yourself and your business from your competitors simply by shifting focus to your customers. Calloway describes real-life examples of companies that have gotten to know their customers very well, and have reaped the benefits of that knowledge in long-term relationships and continuous sales. Armed with proof that true success comes to organisations that can stand alone in their fields, he points out how a little self-discovery can take your business far, and how knowledge of self is critical to creating a successful branding strategy
Deciding to Go In the film Apollo 13,Tom Hanks’ character, astronaut Jim Lovell, reacts to the U.S. landing on the moon by telling his wife, “From now on, we live in a world where man has walked on the moon. It’s not a miracle.We just decided to go.”“Deciding to go” is the first step toward becoming a“Category of One” — making the commitment that creates a new level of success. Unfortunately, it’s also the step usually not taken. Most companies never decide togo. They talk a lot about it; they write mission statements and hold meetings, but when it comes down to making that commitment, they back away. Extraordinary companies make very deliberate decisions to go in terms of pursuing greatness; of seeing how far they can go and how successful they can become. Then, in order to sustain that success, they recommit to that decision again and again.
Go Big or Go Home.
Most companies never get beyond the talking stages of the decision to go. Even though they think they’ve committed to doing something different and significant, what they’ve really done is commit to the discussion of doing something different and significant — they talk a good game, but never make a single play. The decision to go must be followed by immediate and significant action —a clear sign throughout the company that signals there’s something big going on, made real by action. Many companies encounter their first real obstacle at this juncture — informing employees of impending change. They assume — mistakenly — that all employees not only want to be the best, but are also willing to do what it takes in terms of commitment, change and hard work in order to make it happen. This is often a false and, occasionally, dangerous assumption. If the company’s leadership is unable to rectify the situation, greatness on any level is virtually impossible — nothing of any substance will take place without the commitment of the employees.
You Get What You Want the Most.
Talk is cheap; actions speak louder than words. If you want to be a Category of One, you must back up your stated desire with action. Some companies say, “We want to have the best people in the world,” but they won’t invest in training or better hiring practices. They want their people to take responsibility, but they don’t give those people any real decision-making authority, and they micromanage everything those people do. They say, “We want teamwork,” but they do nothing to improve communication between departments. What they really want is the status quo, with slogans. They get what they want the most.
Straight Answers to Tough Questions.
Companies must confront themselves with these simple yet very tough questions about their stated goals:
- Do we really mean this?
- How far are we willing to go to achieve our goals?
- What is our organization’s tolerance for chaos?
- Are we willing to let go of everything that works in order to reach our destination?
- Who are we?
- What do we stand for?
- Are we serious about this effort?
There are very serious ramifications involved if your organisation is serious about achieving its goals. By answering “Yes,” you make the commitment to seeing the effort through. Be careful when you do this. It is better to be honestly mediocre and try to stay where you are with a sense of contentment, than to be unrealistically ambitious about what is yet to be and never get there,because you never really wanted to go in the first place.
Making the decision to go means you start with anidea and do what must be done to make that vision a reality. You can’t just “believe” your way to becoming extraordinary, but you also can’t take action that isn’t driven by a belief shared throughout your organization.How does it get through your organization? Through communication. Some companies make a big deal of their push to greatness. They make big presentations, then follow up with communications that reinforce their goals.They also take the personal approach, making sure on going changes are discussed with employees face to face,encouraging buy-in at each stop, and building momentum as more and more people embrace the vision.
Know Who You Are.
Who are you? It’s a tough question; most companies can’t answer it. Who are you? Think about what’s important to you, what you’re about, and why your organisation opens for business every day. If you have no sense of who you are, what’s really important, and what the point of it all is, you will find it difficult to compete with other companies who have these basics figured out.
Every Category of One company creates clarity around the“why” of its business, not simply the “what.” Much of this is wrapped up in your company’s culture; how things are done in your business. Culture is the rules, spoken or unspoken, that the company plays by —every company, whether by design or accident, has a culture. The question for your organisation to ponder is whether your culture is the one you want; the one that matches the idea of what your company wants to be.
Strengthen Your Language.
Most companies have a mission statement, or a vision statement, or both — carefully crafted declarations that proclaim things like, “We will be the market leader,” or “We will create a superior return for stakeholders,” or some such uninspiring corporate-speak that means little or nothing to anyone in the real world. What is the point of having a mission statement if not to get to the guts of what you’re all about, in a way that actually means something significant, personal and exciting to the people in your organisation? A weakness of so many companies is their reluctance to use powerful language to express what they claim are powerful ideas.
Sometimes, people in business are so afraid of being “inappropriate,” they use bland corporate-speak that accomplishes nothing. What’s really inappropriate is having a mission statement that means nothing to anyone and fails to excite people. If you have strong feelings about your company, your customers and your people, use strong language.
Knowing Who You Want To Work for You.
In a marketplace where companies compete for the scarce number of truly great employees, you must have a clear sense of who you are so that you can attract the people you want. Employer branding is as important as being branded with customers.They both want to know who you are. If you don’t know, how in the world are they supposed to know
LensCrafters Expresses Its Unique Vision
If you were asked to say what business LensCrafters is in, it would be reasonable if you said the company is in retail sales: It has stores and it sells eyeglasses. Ask a LensCrafters employee, and he or she will likely tell you something different — that the company spends its energy “giving the gift of sight to those who have the least and need [LensCrafters] the most.” This powerfully worded statement of vision is the switch that turns the company’s people on. It is where these people become more than what they sell: They have a purpose much bigger than product sales. They believe that good vision is a basic human right, and they back that up in all they do, whether it is serving a customer in a mall store, or delivering eyeglasses to underprivileged people through its charitable program, Give the Gift of Sight.
They are the walking, talking embodiment of their company’s unique vision, and their attitude fuels their goal: to help the world see better.
Position Yourself in Advance
A company wide sense of purpose and identity makes decision making easy and efficient. You can better know how to do the right thing when faced with difficult decisions by making those decisions in advance. It’s like being an umpire in a baseball game — the key to being good is in calling pitches consistently, positioning yourself behind the plate in such a way that you call the pitches the same way every time. The same principle works in our everyday lives: You position yourself in advance so that, when difficult questions arise, you don’t have to wrestle with an answer — you’ve made it in advance. Extraordinary companies stay focused because they decide in advance what businesses they do not want to be in, or what customers they do not want to work with.They’ve created clarity around who they are and what their point is — that is how goal setting works.
They make sacrifices along the road to achieving their goals,because they understand what they want most from their business and, perhaps more importantly, what they do not want.
Who You Are as an Employer.
The necessity for differentiating your company as an employer is the same as it is with customers. It does not suffice to feed prospective employees lines like, “We’re a great place to work.” The best and brightest people in the marketplace want to have a clear sense of what it’s like to work for you. Any company can tout competitive pay, great benefits, vacation time, and so forth — every company offers these. Don’t be afraid to distinguish your organisation from all others — if you fail in this effort, you, in effect, commoditize yourself as an employer.
Southwest Finds the Right People.
Southwest Airlines, in its quest to find the right people to be its flight attendants, has run a print advertisement that contains a photo of a clear blue sky, as seen from the window of an airplane in flight. The headline of the ad is, “Does Your Current Job Have a View Like This?” The headline is followed by copy that reads, “We’re looking for unique people interested in a rewarding career … You’ll receive outstanding benefits, travel privileges, and the power to express yourself while being part of a company renowned for its fun, supportive culture.” While some of the copy is run-of-the-mill, Southwest appeals to the heart of the prospective employee when it mentions “the power to express yourself” and a “fun,supportive culture.” Most businesses shy away from such powerful descriptions, preferring vanilla corporate language that says absolutely nothing. Southwest connects to the type of employee it wants by revealing its culture in descriptive, alluring terms. Such an ad is one significant way Southwest finds the right people to join its workforce.
You Know What Used to Work.
Everything about the way we do business is changing. While most people will agree that change is a good and necessary thing, most of us are, to some degree, resistant to change. The Web changed everything, just like the telegraph did, the railroad did, the internal combustion engine did, the assembly line did, television did,and computers did.
The significance of the Internet is the speed at which changes now cascade around us in a constant flow that never lets up and, in fact, increases in speed all the time. Big changes aren’t new; big changes that come to you at light speed in a never-ending stream— that is new. Change is constant, sudden and significant. Competition, likewise, can shift in a nanosecond.
Rest Not on Your Laurels.
Past success can be (and usually is) the enemy of future success. If you have a track record of past successes and are good at what you do, you might be in a dangerous position. Complacency tends to set in when a level of sustained success is achieved. The great danger of past success is that companies relax into thinking they know how their business works, or how their customers operate, and they fail to do the things that made them successful in the first place. If you’re successful, you know what used to work. If you’re successful, you can compete and win in markets that no longer exist. The game starts over today and will start over again tomorrow. Think of your company as the planet Saturn, with a stable core — your values, who you are, and what you stand for — surrounded by rings, representing the tactics you use when conducting your business. The rings change constantly, just as your customers do, or the technology you use, etc. Always remember who you are and what you stand for, but also look at how you must change to meet the needs of a world that is new every day.Keeping
Your Balance Through Changes.
Changes in business are nothing new. These days, the biggest difference is that major changes don’t happen occasionally — they happen all the time, and it’s often difficult to see them coming. Not only does a company have to be willing to change and change often, it has to be willing to be wrong, because it must sometimes move a step or two ahead of its forecasts. Things change so constantly that by the time a situation is analyzed and a course of action is chosen, the situation itself has likely changed. Thus, analysis of a market or competitor can’t take place periodically: It must happen constantly.
Today, if a company does not change, not only is it most likely not stable; it is at serious risk of disappearing altogether. You can most successfully change what you’re doing and how you do it if you have a clear sense of who you are.
Embracing Change.
Category of One companies learn to create their own sense of urgency without waiting for crises to shake them from their complacency. Failure is a constant companion— the prospect of failure, real or imagined, pushes these companies to take steps to avoid that failure and to make what they do obsolete, so that they’re always several steps ahead of the competition. Far from resisting change,they run with change to create their own future, rather than leave it to others or to circumstances that are out of their control.Success runs in cycles. What you’re doing right now will run its course with a period of initial introduction to the marketplace, followed by a peak of popularity, with a period of decline coming thereafter. To achieve sustained success, you should introduce the next product while the first product is at its peak, so that you are continually replacing what is declining with what is ascending. Evenproducts that don’t appear to wax and wane in such cycles(soft drinks, for example) do, at least where marketing is concerned. The reasons people buy the product change,even if the product itself does not. Nothing stays the same.
What You Don’t Know.
The very act of becoming successful demands that you change, learn new skills, and morph into a bigger, better,more successful you. You must take things up a notch, or you’re sure to slide backward. Category of One companies embrace this frantic method of doing business and embrace the fact that continuous change is the norm. Indeed, individuals and companies that excel at change are those that accept the idea that they don’t know what’s going to happen next, and they’re perfectly fine with not knowing. They navigate periods of uncertainty with the confidence of knowing that whatever happens, they can make the appropriate adjustments and will handle it in a way that creates opportunity.
A New Definition of ‘Normal’.
One of the most valuable ideas you can embrace as a proponent of change is the idea that whatever happens is normal. That’s not to say that every given circumstance is desirable, or even acceptable, but it’s almost always normal. That concept is what separates those who handle change effectively from those who go ballistic at the slightest deviation from the expected process of things. You’ve seen both kinds. One person might completely lose it if he or she is told there’s been a change in plans, policy or strategy. The other kind of person is the type who, regardless of what changes you throw at him or her, seems to handle any situation almost effortlessly. The value of this type of person — one who can perform well under pressure — cannot be overestimated. Category of One companies have a knack for creating opportunity out of virtually any set of economic or market conditions. How you react to different conditions dependson your perspective of the environment. Perception is reality; the challenge is to choose a perception that will create opportunity. Once you’ve mastered that skill, your perception really does become your reality — what are difficult times for others prove to be opportunities for you.
Good times are easy going times for most companies; when things are easy, anyone can lead any company. Companies that are truly good at what they do welcome the occasional rough patch, because it helps shake out the competition at the same time new opportunities arise for those who are paying attention.
The Commodity Trap.
The most basic competitive question is, simply, “Why should I do business with you?” Most companies answer that most competitive question in a most non competitive way, by telling the customer, “Do business with us,because we’re pretty much the same as our competition,but we’re good at it.” Not much differentiation there. Customers see parity everywhere. They look at your business, your competitor’s business, or some unrelated business, and they believe they can get the same thing, just as good, for a similar or lower price, from the competition. And they are exactly right. Businesses are forced to compete as commodities until they do some-thing to change the customer’s perceptions of them.
Transcending Commodity.
The great challenge for any business today is to transcend commodity — to differentiate itself from competitors in an effort to avoid being compelled to compete in low-margin price wars. You want, in other words, to force an “apples and oranges” comparison between your business and the competition, to create such a significant difference in what it’s like to do business with you that customers can go nowhere else to get their desired experience. Once you have your superior product and exceptional service offering, the real fun begins.
The first step in transcending commodity is to recognize that the market-place sees you as a commodity. Don’t fight it — it’s a competitively powerful perspective to admit you’re pretty much the same as your competitors; to be realistic and see your company through the eyes of your customers and prospective customers. What you do not want to do is try to differentiate your business with false promises, making things up in order to pull in customers. They’re not dumb. Once they figure out you’re promising more than you can deliver, you won’t have to worry about them anymore, because they’ll be gone, beyond your reach for good. It’s a strategy that doesn’t differentiate a business — it destroys it.
You cannot advertise your way to superior performance, either. If you want to run an ad campaign that tells the public how great you are, here’s a tip — get great first. The customers know the truth; they’re flexing their economic muscles as never before. They will not be lied to. They are a determined bunch, and they will not tolerate deception. Not only will they leave you if they feel misled or mistreated; they’ll look for justice, whether that justice takes the form of letters to the Better Business Bureau, hiring an attorney, or simply telling everyone they know that your business is making promises it cannot keep.There is no longer such a thing as a “normal” exaggeration of claims for a product or service — you must deliver what you promise.
Exaggeration: A Case Study.
The author was doing consulting work with a bank that was losing market share. Instead of doing the work needed to improve its services and relationships with customers, the bank ran an ad campaign with the slogan, “People Matter Most.” A fine idea — all the benefits of improved service to customers, without the work! Not quite. The first people to see through the campaign were the employees, who merely laughed and shook their heads. The customers eventually caught on as well, and some of them did more than laugh — they took their business elsewhere. The bank ended up with a much worse problem than the one with which they had started. Its campaign had called attention to what,in fact, was its greatest weakness — it was terrible at dealing with people.
Beyond Expectation.
To avoid the commodity trap, you have to find points of genuine differentiation, mostly by looking in places you’ve previously neglected, and going beyond the expected factors of price, quality and service. The key is value. Customers are looking for a way to solve problems or create opportunities. You need to offer more than simply a good price to keep customers happy. You need to help them use your product or service to make their dreams come true. Indeed, the real competitive battle in many marketplaces is being fought beyond traditional notions of service in areas such as problem solving, or what experience or feeling is created for the customer. Think about where you differentiate or, more accurately, where you do not. It’s probably not with your product: It’s rare anyone gains competitive edge strictly on product quality. Quality is an expectation, an entry-level factor. Everyone makes good products. Gone are the days when, for example, only a handful of car companies made quality automobiles, and the rest made autos of questionable quality. Now, even economy cars impress with their durability and features.
Les Schwab: Differentiates With People Power.
Les Schwab Tires is one of the largest independent tire dealers in the United States. The company offers good quality tires at a competitive price, with a great selection and excellent warranty. What differentiates Les Schwab, however, is what it does beyond price,quality and even service.Les Schwab attendants run to your car. This running doesn’t occur by accident — the company calls it “sudden service.” With the simple act of running to the car, Les Schwab Tires sends a powerful message to every customer — “We want and appreciate your business.” Customers remember this; Les Schwab is known far and wide for its running attendants, resulting in instant differentiation from slower competitors.
People as Differentiation Factors.
The irony is that when you create a truly high-quality product, you compete only against other high-quality products, so the competitive battle shifts from quality to other areas, such as your people. Think your people are better than your competitors’? Prove it. What do they do that others do not? How is your training better? People can be that great differentiating factor that enables you to transcend commodity and defy comparison.
Your Brand Is Everything.
Your brand is not your advertising. It is not your logo,your company name, or even your product. Your brand is owned by your customers and anyone else who has an impression of your company. Your brand resides in the minds of your customers — whatever they think you promise them, and whether or not you keep your promise. It is what defines you in the marketplace. It should be the top priority of every employee — from the president of the company, to the employees in the warehouse, to the receptionist — to build, protect and represent your brand to the best of their ability.
What Branding Is All About.
Some other things you should keep in mind about your brand include the following:
- It’s not just about storytelling. It’s not the job of the marketing, advertising or public relations departments to create the brand. They have a hand in it, cer-tainly, but their job is to tell the story of the brand. It’s the job of everyone else in the company to create the brand with the quality of how they do their work, everyday. Brands are not created by commercials: They’re created by every single employee in your company.
- Inconsistency kills. Category of One companies understand the ongoing nature of building, protecting and communicating the brand all the time, 24 hours a day, seven days a week. You can advertise all you want, and you can have some really terrific people working for you, but your brand is only as strong as the employee with the weakest commitment to excellence. If that person fails to fulfill your promises to your customers, you run the risk of losing vital support from those customers.
- Focus is key. To maintain brand strength requires focus and constant reinforcement with everyone in your organisation. Brand isn’t the mission statement you wrote, nor is it your 10-point list of priorities. Your brand should be a simple understanding of who you are,what you promise in the marketplace, and your ability and willingness to keep that promise.
- Communication reinforces your branding effort. Reinforcing the strength of your customer relationships as the core of your branding effort is a process, not an event. It starts with getting buy in internally from managers and employees through constant communication to and feedback from your work force. Only when you have their blessing can you take the strengths and message of your brand to the people outside the company your customers.
- Your brand is personal. A job well done means more than simply doing great work: It means doing great work in a way that builds successful relationships with customers, employees and partners. People are at the heart of your brand and branding efforts. Your promise to the marketplace — the foundation of your brand — is personal.
Three Customer Rules.
Every Category of One company excels at following and living three essential rules:
- Know more about the customer than anyone else.
- Get closer to the customer than anyone else.
- Emotionally connect with the customer better than anyone else.
In a customer-driven market, there are no substitutes for these rules. Combining these three actions will give you the single greatest advantage over your competition, enabling you to truly transcend commodity and defy comparison.The single most powerful selling tool is to know more about your customer going into the relationship. The problem with this idea is that, in some eyes, it takes too much time. Who has time to do the legwork or the research required to get to know prospective and existing customers better? You must make the time, and not simply to gain more business. Knowledge of a prospective customer can help you recognize what business you don’t want to pursue.
It can be very damaging for a business to try to make itself fit into a situation with a customer that is not mutually beneficial. Why be a square peg trying to fit into a round hole? You can’t qualify your prospects without the right knowledge.
Walking Away.
Category of One performers are very good at knowing where they fit and where they do not. They will quickly walk away from a situation that does not fit them. They focus on gaining knowledge not for the purpose of making a sale, but for the purpose of seeing if it’s a good fit.The worst thing you can do for your business long term is to get outside of what you’re good at and try and do a job that someone else should be doing. Walking away from an imperfect fit is just another example of why it is important to know yourself, to know your business, what it’s there for, and what you’re there to do.
Pursuing a bad business fit takes time and resources away from where you should be focused —on building customer relationships that do fit.
Brand Focus at Quill and R.J. Young Larry Morse, president of Quill (a leading direct marketer of office supplies), explains the essence of his company’s brand as a dedication “to providing customers with the very best service possible …Quill’s mission is simple — Treat our customers better than anyone else … that is what our organisation will always be totally focused on.” After 46 years in business, Quill understands the importance of picking one thing and staying totally focused on it.R.J. Young Co., a leading supplier of copiers and office machinery, has a similar brand concept. For many years, the company has stated, “We’ll make it right.” Period. Forget what the warranty says. The company wants to know what you say will make you happy. “We’ll make it right” truly is its brand.
The New Customer Reality.
Have you noticed something different about your customers lately? Or, to put it another way, have you noticed everything is different about your customers lately? Old conceptions of your business’ relationship with its customers can be tossed out the window. There’s a new reality you must face or risk losing customer relationships if you do not. Here are some things you should know about the new customer reality:
- Their minimum expectations are higher than before.Today’s incredible innovation is tomorrow’s minimum expectation. A few years ago, hotel owners would have scoffed if you suggested that they put an iron and ironing board in every room. Today, it’s expected. The crazy ideas that broke rules yesterday are expected standards of performance today.
- They’re mad as hell. Customers used to know their place and generally took whatever a seller was willing to give them. If they weren’t happy, they kept it to themselves. Things have changed. The dissatisfied refrain from the movie Network— “I’m mad as hell, and I’m not going to take it anymore!” — is the exclamation heard far and wide by customers everywhere. Your customers. Your competitor’s customers. Everyone’s customers. You are not in control. Today’s customers have power like never before, and they are using it. Quality Is Expected
- Quality is an entry-level factor. Product quality is no longer a competitive factor: It is now but a single component in the whole concept of value. It is expected. Everyone brings a quality product or service to the marketplace.
- They look for the total experience. People don’t buy just products anymore. They buy an experience. The whole experience of doing business with a company is much more than simply the product one buys: It’s about the experience the buyer has as the owner of the product. You must change the weight you give to the importance of the customer’s total experience with your business. Service and experience are the primary competitive factors you must address. Adjust accordingly.
- They make the decisions.You need to make the conscious decision to let your customers make up the rules —they already do anyway. If you aren’t willing to play by those rules, you can’t play at all. They won’t let you. Do You Know What Their Expectations Are?
- It’s hard to exceed their expectations.You often hear companies claim they strive to “exceed the customer’s expectations.” Do you have even a remote idea how incredibly high your customers’ expectations are? Exceeding customers’ expectations is a very powerful goal, as long as you remember that you do not decide if you’ve exceeded their expectations. They do that.
- They’re not yours for life. No business today automatically has “customers for life,” which is a big change from the way things used to be. Some businesses, almost by nature, seemed to be able to hold onto their customers without really trying. Today, customers feel they can find whatever you’re selling somewhere else, for the same price or better. They’re probably right.
- They compare you to everything. Every company loves to benchmark, but most only benchmark themselves against others in their market or competitive realm. Customers don’t think that way — they’ll compare you to everyone they do business with. You need to deliver on time like Federal Express and know their names, just like the local dry cleaner. If someone out there provides the level of service they want, they’ll want you to give them that same level, regardless of your business or the other business.
Tough Customers,Tough Questions.
If you want to gain some insight into how your customers have changed and toughened over time, think of yourself and what you want as a customer,and then answer the following questions:-
✓ Are you a tougher customer than you were five years ago?
✓ Are you a more informed and more educated buyer than you were five years ago?
✓ Are you more likely to complain on the spot if you experience a problem?
✓ Do you demand better service than you used to?
✓ If you do not receive the service you want, are you more likely to fire that business and never come back?
✓ Are you more likely today to take action such as writing or calling a company’s management with a complaint?
✓ Do you tell more people today about companies that you have experienced problems with?
✓ Do you take no for an answer or are you more likely to go up the chain of command until you get satisfaction?
✓ Do you demand more value than ever before for every dollar that you spend?
✓ Do you feel like you have choices in who you do business with and that you will exercise those choices if you don’t get the service you want?
You’re pretty tough yourself, aren’t you? Well,your customers are at least as tough as you are.
Final Word.
This is an important book which brings the concept of branding back to reality. To put it simply, your brand is, who you are, what you promise, and your ability and willingness to keep that promise. If you’re truly serious about building a successful business then this Joe Calloway’s book is a must read. Grab a copy and have a read for yourself.
Happy reading
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