When I was in college, back in the early 70ís, I remember reading a book by Alvin Toffler, called Future Shock. It theorized about the thousands of choices we would be forced to make each day and the psychological overload people would experience from all of these decisions.
The future is now! And the task of making so many daily decisions is even more daunting than anyone could have imagined.
Have you been to the supermarket lately?
The average supermarket now displays 40,000 different items. Even though, the average family fulfills 80 percent of their needs from only 150 of these items. In just about every product category, there is now an amazing proliferation of choices. In fact, there are over 1 million different products sold in America, today. This tremendous number of choices in the marketplace can overload the human mind. No wonder so many people seem confused about which products to buy or, even, whose services to use.
Consumers are facing an explosion of choices. Consider how the choices among the following items have increased between the early 1970ís and today:
Over-the-counter pain relievers soared from 17 to 141.
Running shoe styles increased from 5 to 285.
Frito-Lay chip varieties expanded from 10 to 78.
Soft-drink brands increased from 20 to 87.
Types of milk rose from 4 to 19.
Colgate toothpaste varieties went from 2 to 17.
Amusement parks grew from 362 to 1,174.
McDonaldís menu items more than tripled, from 13 to 43.
Software titles grew from 0 to 250,000.
Web sites increased from 0 to 4,787,894.
People are beginning to loose their decision-making capabilities. In the supermarket, they bypass 39,850 items that they donít use. Bypassing products and businesses is a coping mechanism they use to avoid information overload generated by so many choices.
With an increasing number of competitors entering the drycleaning market: Menís Warehouse, Zoots, One Price, etc., customers have so many alternatives that you pay dearly for your mistakes. Once your competitors get your customers, you wonít get them back very easily. Drycleaners that donít understand this will not survive.
How can you and your company develop a strategy for survival?
You need to formulate a strategy thatís clearly stated and highly focused. Be clear about what you want to say and communicate it constantly to your employees and customers.
Emphasize one compelling point: Why customers should buy from you rather than anyone else. Your main goal will be to get your name to take hold in customersí minds.
Getting into customersí minds is difficult. But you must find a way to differentiate your business as the most attractive alternative. This is called positioning.
Human minds are limited. Generally, minds canít retain more than seven units Ė the length of a local phone number. And 7 are about as many names in a typical category as consumers can remember. For low-interest businesses, the average consumer can only name two.
When you overload an electrical circuit, it blows out. Consumers overloaded by choices start blocking them out. Essentially, they resist allowing new choices into their minds.
Customers will resist messages that are confusing, and embrace ideas that are simple for them to understand. Make your message easy to understand and directly to the point. For example: We are this areaís only Certified Professional Drycleaner.
A driving factor in purchases is the desire to avoid risk. Doing business with an unfamiliar company makes people nervous. Today, people fear that they might overpay or not get full value for their money. Wise marketers look for ways to help purchasers overcome their insecurity One way is by using testimonials. Thatís when prominent individuals endorse your services. This implies that others, who use your services, will become more fashionable, more attractive, or even richer. A second way to help customers overcome their insecurities, is to offer a guarantee. Such as: Itís Ready, Itís Right, or Itís FREE. This kind of risk-reversal allows customers to feel confident that are dealing with a trustworthy company. Yet another way to overcome the consumerís insecurity is the use of heritage. People tend to trust a company that has been around for a long time. For example: saying, ďSuperb drycleaning, since 1979Ē reassures customers that your store is a safe choice.
The point to remember is simple: Your strategy must create a strong position for your business. Consumer perceptions depend on positioning Ė specifically, in how your business differentiates itself in customersí minds. That means planting something in their minds that causes them to put your cleaners ahead of all the others.
Before I discuss how you can differentiate yourself, letís talk about how not to do it. Some cleaners think they can differentiate themselves through quality and customer satisfaction. But in todayís world, those qualities are rarely differentiators. Theyíre givens. Customers expect quality and satisfaction as part of anything they buy. If not, they want their money back, and will trade somewhere else.
There are a number of differentiating ideas. One is to be first in a particular category. You can be the first high-end cleaner. You can be the first wedding gown specialist. You can be the first one-price cleaner. You can be the first to offer same-day service. If youíre first, what happens when competitors try to copy you? They unintentionally reinforce your position.
A second way to differentiate is through leadership. Powerful leaders become synonymous with what they do. If you think computers, the first name that occurs is IBM. With chocolate bars, itís Hersheyís. With soft drinks, itís Coke. And with ketchup, itís Heinz.
If youíre the leader, itís O.K. to brag. If you donít take credit for your achievements, someone else might. Of course, there are different ways to lead and sales leadership is just one of them.
Another form of leadership is technological. If you can convince consumers that you use the newest and most advanced forms of technology in your cleaning processes, they will consider this to be superior to what theyíve been getting from your competitors. It is possible to attract customers with impressive sounding terms. Just be sure the resulting product is equally impressive.
Then thereís performance leadership. If you are capable of providing the fastest, most reliable service, of anyone else in town, you can build a reputation that will be difficult, in not impossible to dislodge.
Finally, thereís a differentiator connected with doing things the old-fashioned way. Older consumers, as well as some younger ones, can be a soft-touch for the way things used to be done. Like: We press you clothes the way your Mother would.
Hereís the importance of differentiation in a nutshell: If you donít have another point of differentiation, youíd better have the lowest price.
As you can see, your strategic planning should start with your competitors in mind. You want to determine precisely where theyíre strong, and where theyíre most vulnerable.
If your strategy is superior to the competitionís, you will win your market. With a sound understanding of consumer perceptions, you will be able to exploit opportunities to grow revenues and earnings.
Youíve heard the saying, ďKeep it simple, stupid.Ē And itís clear that keeping it simple is the smart thing to do. Itís the key to winning customersí attention, their business, and ultimately, their lasting loyalty.