Marketing mistake #1: No differentiation strategy

Looking the same as the competition is one of the most common marketing mistakes around. Here's a seven step differentiation strategy that one business is using to stand out.

I spend a lot of time looking at the branding, positioning, Yellow Pages adverts, websites, newsletters, etc of small businesses and if there's one thing that jumps out at me, it's that many businesses in the same market look the same and say the same things.

Whilst they may be offering a similar service to many others, they need to position and differentiate themselves. So, how can they create a differentiation strategy?

By not focusing on what they do, but how they do it.

For example, how do they:-

Here’s an example of what I mean. It’s taken from a mortgage manager, but can be adapted to any business.

Seven step customer care system

The seven step customer care system has been designed around the significant milestones in the process of applying for a home loan.

The system seeks to overcome the typical complaint that once a loan application is submitted there are often communications “Black Spots” where the potential borrowers don’t know what’s happening with their loan application.

Included in the system are gifts that relate to the point in the process – these are used as rewards, but are always practical and always branded with the company’s logo and contact details – and so will be on display to others.

1. The Torch

Within two days of receiving the application, a torch is sent. The accompanying letter is headed “Congratulations. You’ve Seen The Light!”

The letter congratulates them for making an “enlightened” decision, acknowledges the trust placed with the manager, reminds them of the company’s credentials, and outlining exactly what the applicant can expect in terms of efficiency and communications. It also introduces the people that will be involved.

2. The Clock

This mailing contains a clock with the company name and contact number prominently displayed.

The letter thanks them again for using the manager’s services, and acknowledges that they should have already received the list of outstanding items needed in order to move the file forward.

The clock is highlighting that TIME is of the essence, and so the applicants need to return all outstanding information ASAP.

3. The Stress Check Ruler

The next communication is when the mortgage manager sends another letter telling the applicant that they have passed the file to the mortgage insurer and are waiting for their response.

The headline of the letter reads “Warning – Waiting For Formal Loan Approval May Be Stressful”.

Enclosed is a white plastic ruler with a fun-to-use press sensor on the front, which measures heat and moisture from a person’s finger, and then changes colour depending on how hot (stressed) they are.

4. The Portfolio Pouch

Once the loan has been approved they send a letter congratulating the applicant on the approval and enclosing a Portfolio Pouch.

This is simply an oversized plastic or leather pouch (logo on it of course) with some company information and will be used to store the legal documents.

5. The Personalised Thank You Card

A day after the loan closes a thank you card is sent to the borrower and everyone else involved in the transaction.

A personalised handwritten message is put on the inside, and mentions that another gift will be coming shortly.

6. The Gift Basket

Within a further five days, the borrower (and broker or other referrer of the business, if applicable) receives a basket of fruit, cheeses, and/or wine with a card again thanking them for their business.

7. The Testimonial Request

This letter is sent out two days after the gift basket, to ensure the borrower is feeling especially good about all the gifts that they’ve received.

It encourages the borrower to write a testimonial letter. This is done in the form of a few simple questions that they could answer in their letters, and encloses a stamped, addressed envelope.

About 50% of borrowers respond to this.

Is it worth it?

It seems like a lot of money and effort, but the question to ask is this - can you afford NOT to do this? Hardly anyone else is doing it, so you'll really stand out.

Would it help to cement your relationship with your clients, increase your successful projects, and increase repeat business and referrals? I think it would!

• Published 27 November 06
• 
• Email this item
• Print this item
• Rate this article

Attracting new business (7) | Business branding (17) | Business marketing (28) | Communication skills (14) | Customer relationships (12) | Customer service (7) | Email newsletters (6) | Online marketing (23) | Presentation skills (4) | Pricing strategy (8) | Public relations, PR (14) | Sales strategies (10) | Small business blogs (4) | Using surveys (5)

Have you grabbed your four free bonuses from us yet? They're way too good to miss. Details here.

6 comments | Add your own 

• I think this is perhaps going a little over the top. By all means, stand out...but if I received THIS MANY mailouts from a supplier...I'd soon think I was overpaying them, as they obviously don't mind spending my money on their promotional stuff. John from Hobart

• Hi John, I guess it depends on what service you provide. In the example, a home loan provider is organising finance for what is likely the biggest financial transaction of your life. It can also be a fraught process. Giving this level of communication and comfort is proven to increase the % of applicants who convert into borrowers, and therefore is well worth it from the mortgage manager's perspective.
  Of course, the system is only an example and can be adapted to suit. In my own business I communicate clearly and often, particularly at the start of the relationship, and also "carry the risk" myself by not charging a cent until the customer says he/she is happy. However my communications are often e-mail and 'phone as I'm promoting the personal service aspect of what I do. I guess it's horses for courses. Peter Griffin from Sydney, Australia

• Hi Peter - a great response to a great comment from John I'd say. We can all take something v useful from this and adapt to our own situation. Robert Gerrish from Flying Solo | Read my articles

• We have 20 franchise owners in NSW/ACT and I think they could all get something from a similar type of program. Great idea. I will put it to them at our next meeting. Athol Ritchie, Master Franchise Worldwide Online Printing from Sydney

• Hi Peter - I have just read your article and already forwarded the link to a client as, although I acknowledge the commonsense in John's response, I think the philosophy you have espoused is a benchmark in how to get referrals by turning a simple application into what Robert calls 'a raving fan'. Great stuff !! Grant Hyman from Sydney | Read my articles

• Communication is a two way street, and I would presume that after so many points of contact and gifts received that the potential borrowers would have already responded with at least two or three positive feedbacks about their thoughts re their services and customer service. Then it is just a matter of requesting permission to publish. I always find unsolicited feedback rings most true. Helen Dean from Melbourne

6 comments | Add your own 

Add Your comments

  Preview comment
 

Name Website * Town / city and country Email (never sold, displayed or given away) * This will link your name to your site. So please avoid self promotion elsewhere! We delete spam, disrespectful or off-topic comments.

Notify me of follow up comments via email Subscribe me to Soapbox, Flying Solo's weekly newsletter Enter security code, without spaces, below: