Why Your Service Attracts Clients Who Bargain
If your service business constantly attracts bargain-hunting clients, it’s time to face a harsh reality: your positioning is weak. When you market your service generically, it becomes a commodity. And commodities are compared solely on price. April Dunford in Obviously Awesome highlights that positioning is about placing your service in a context where its value is obvious. If your service is labeled merely as a 'marketing agency,' clients will pit you against every other agency, focusing only on who charges less.
Let's dive deeper into this. Imagine you run a digital marketing agency. Your current pitch might sound like this: "We offer SEO, social media management, and content marketing." To a potential client, this sounds like every other agency out there. Price becomes the differentiator because, in their eyes, there's nothing else to set you apart. This is the crux of commoditization.
To stop attracting clients who bargain, you need to reposition your business. Define what makes you unique and articulate it clearly. This shifts the focus from price to value. For example, instead of a generic pitch, you might say: "We help local restaurants increase their online reservations by optimizing their Google My Business profiles and creating engaging local content." Now, you're not just another marketing agency; you're a specialist with a focused solution.
The Power of Effective Positioning
Effective positioning creates a clear distinction between you and the competition. Dunford's framework suggests identifying your real competitors in the minds of your customers. Choose a market category where your strengths shine. This doesn’t mean inventing a new category altogether but understanding what specific problem you solve best and for whom.
Consider a scenario involving a local IT services firm. Initially, they were a jack-of-all-trades, offering everything from network setup to software installation. However, they were consistently losing clients to cheaper freelancers. By repositioning themselves as cybersecurity specialists for small law firms, they targeted a niche that valued reliability and compliance over price. Their messaging changed from a laundry list of services to highlighting their expertise in legal IT security, attracting clients willing to pay a premium for peace of mind.
Steps to Identify Your Niche: 1. Analyze Your Current Client Base: Look at your most profitable and satisfied clients. What do they have in common? 2. Identify Your Unique Strengths: What does your team excel at? Where do you consistently deliver better results than competitors? 3. Research Market Needs: Identify gaps or underserved areas in the market that align with your strengths. 4. Craft Your Niche Statement: Clearly articulate your positioning. For example, "We specialize in cybersecurity solutions tailored for legal practices."
Creating a Blue Ocean in a Sea of Red
Competing on price is a never-ending struggle in a crowded market, also known as a 'red ocean.' The goal is to find a 'blue ocean'—a new market space that's uncontested. This is where the Blue Ocean Strategy by W. Chan Kim and Renée Mauborgne comes into play. Their ERRC grid—Eliminate, Reduce, Raise, Create—helps you innovate value and break free from direct competition.
Consider the case of a local event planning service. Instead of competing with every party planner in town, they used the ERRC grid to eliminate traditional services like printed invitations and create unique offerings like digital event experiences. This new market space appealed to tech-savvy, eco-conscious clients, reducing the focus on price and increasing the perceived value.
Applying the ERRC Grid: - Eliminate: Identify which aspects of your service are outdated or unnecessary. This event planner, for example, dropped printed invitations in favor of digital options. - Reduce: Look at areas where you might be overserving. Are you offering too many options that overwhelm rather than attract? - Raise: Determine what aspects your clients truly value and amplify them. For the event planner, this meant focusing on seamless, tech-integrated experiences. - Create: Innovate new offerings that your competitors aren't providing. The event planner created interactive virtual tours and real-time event streaming.
Steps to Reposition Your Service
To reposition effectively, start by mapping out the attributes your competitors focus on. Use the ERRC grid to analyze these attributes: Eliminate what doesn't add value, Reduce what is overserved, Raise what clients truly value, and Create unique offerings.
For example, a cleaning service might eliminate one-size-fits-all packages and instead create customizable cleaning plans that cater to specific client needs, such as eco-friendly products or deep cleaning for allergy sufferers.
Detailed Steps for Repositioning: 1. Conduct a Competitive Analysis: Identify what your competitors are offering and how they're positioning themselves. 2. Client Feedback: Gather insights from your current clients about what they love and what they wish you offered. 3. Map the ERRC Grid: Apply the ERRC framework to your services. Identify what can be eliminated, reduced, raised, or created. 4. Test Your New Positioning: Before a full launch, test your new positioning with a select group of clients to gather feedback and make necessary adjustments. 5. Full Rollout: Once confident, adjust all marketing materials and communication channels to reflect your new positioning.
Communicating Your New Position
Once you’ve redefined your service, it’s crucial to communicate this effectively. Rewrite your marketing materials to reflect your unique value. Instead of listing services, tell a story about the problems you solve and the results you achieve. Highlight testimonials from satisfied clients and case studies that demonstrate your success in your new niche.
Take a digital marketing agency, for instance. If they shift from general SEO services to specializing in SEO for local restaurants, their communication should focus on how they increase foot traffic and online reservations, not just search rankings.
Communication Strategy: 1. Revamp Your Website: Make sure your website clearly reflects your new positioning. Use storytelling to engage potential clients. 2. Update Social Media Profiles: Consistency is key. Ensure all digital platforms reflect your new niche and unique value propositions. 3. Leverage Content Marketing: Create content that educates your audience on your niche expertise. This could be in the form of blog posts, webinars, or case studies. 4. Client Testimonials and Case Studies: Use real-life examples to show potential clients the benefits of your specialized services.
The Result: Attracting Clients Who Value, Not Bargain
By repositioning your service, you’ll naturally attract clients who value what you offer. They’ll see you as a specialized solution rather than a generic option. This shift in perception allows you to command higher prices and enjoy healthier profit margins.
Revisiting the cleaning service example, after repositioning, they attracted clients looking for custom solutions rather than the cheapest option. This change not only improved client relationships but also increased overall profitability.
Growayone: Your Partner in Integrated Marketing and Sales
At Growayone, we understand that marketing and sales are not separate entities but parts of a cohesive system. Our approach helps you reposition your service to attract clients who appreciate your value, not just your price. Visit growayone.com to learn how our expertise can transform your business strategy and drive growth by addressing both marketing and operational challenges effectively.
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