Small Business Profit Course Module #1a: Differentiation, Positioning and Branding: What’s what?

Let’s jump into it!

When you’re in business, the 2 most important questions you must answer are:

“Why should I do business with you rather than the 2,000 other competitors and substitutes to your product?”
and…
“Why should I continue to do business with you?”

Finding a profitable answer to this question is not as obvious as it may seem at first.
The answer that satisfies the market can only be found in differentiating your business so that the market responds to your tactical marketing overtures, talks about you, and comes to you when it need your services.

Differentiation is exactly what it sounds like! It means being known for something…being different from the others. It’s about the idea that makes a prospect travel the extra 15 minutes, 30 minutes, 4 hours to pay you rather than your competitors. Differentiation that counts is noticed (and valued by prospects and clients) and is your source of competitive advantage.

So what’s positioning?
My definition of positioning is an outcome you achieve in the mind of the marketplace. It describes how the consumer perceives your company relative to your competitors. Your positioning is often largely determined by the choice you make about which valued attribute you want to embody – Upscale, low price leader, exclusive, etc and which customer segment you want to serve.

While Walmart and Target have been discount retailers, Walmart’s positioning has traditionally been “broad selection at the absolute lowest price” such that their USP slogan for a long time was “Always a low price, Always!” (they’ve changed it to the relatively weak “save money, live better”).
Target on the other hand, is positioned sort of as “affordable chic” with their slightly more sleek stores and fancy TV commercials.

Branding describes the efforts that businesses (or savvy and enterprising individuals) make towards embedding their desired positioning solidly in the minds of the marketplace. Since the scope of this blog, my concern and expertise is in the small business environment, I’ll elaborate on practical branding for small businesses and leave off “big business” concerns that may or may not be relevant to you.

For you small business owners and entrepreneurial professionals, the most accessible form of brand management is not a logo, not a fancy website or fancy brochures, but a USP (Unique Selling Proposition) that works.

The USP 101 post goes deeper into the unique selling proposition and why it forms the foundation for every effective small business marketing system, but I’ll offer you a brief definition here.

A USP is a concise, benefit-telegraphing idea or promise that conveys powerfully and with immediacy why your target customer or client should do business with you rather than a competitor or substitute. A USP slogan is the statement that communicates the USP and that can be deployed and re-deployed throughout your marketing system.

Are you already doing a lot of advertising in valpak, yellow pages, newspaper and direct mail and want to see a dramatic jump in your business in a very short time?

Then you need to define, develop and deploy an effective USP. It’ll pay off for your business in spades!