We recently helped one of our clients, a skills training centre, do some research with a group of small business owners. We discovered that the three top issues on the minds of these business people were: how to find new customers; how to stay ahead of their competition; and how to spend their marketing money more effectively. They were all interested in taking their business to a higher level.
A good first step in getting to the next level in your business is to “discover” what your company is really good at. In business lingo, this is called “defining your core competency,” and it’s often surprising that many business owners have never nailed this down.
Ask yourself this question, “If you were forced to divest your company of everything it does every day except one set of activities, what would you keep?” What really generates your profit and keeps your customers coming back? What activities could you discard with no real danger to your business?
Once you know the activity that is core to the survival and prosperity of your business, it gets easier to see who the prime prospects that you appeal to are, and because you know precisely who you are appealing to, it’s easier to find them, and easier to determine how to spend your sales and marketing dollars.
Here are some ideas to start your thinking about core competency:
Are you better than your competition at the nuts and bolts of sourcing raw materials and components, turning them into products, and setting up a great distribution and sales network? This is probably the only time we will recommend that you look at your pricing — if you can drive cost of your development processes and guarantee delivery times, you can keep your profit margin while passing savings on to customers and create long-term business relationships. A good example of this is Walmart.
If research and designing great products is what you are good at, you can go to market saying you really have developed the equivalent of the better mousetrap! Unique products is the niche where you’ll compete. Apple (iPhone, iPod) is probably one of the better examples here.
If your company is known for creating a great customer experience and able to promote it with a marketing system that ensures customer relationships, you’ll be able to say that you are easier to do business with than your competition, and be able to prove it. If your team excels at creating happy customers who can’t wait to refer you to others, you’ll want to focus on the results you offer. Think of TD Trust and all those easy chairs in their ads.
Yes, we know, the examples are all multi-zillion dollar companies with megabuck advertising programs, but you can play the game too. It’s a simple idea: find what you are good at, and only spend your hard-earned marketing money on finding customers who want and appreciate just what you do best.