More often than not, just lowering your prices
is a lose-lose race to the bottom, nobody wins.
But that doesn't mean you should also
just throw in the towel and give up
every time your competitors lower their prices
trying to take away market share.
So what's the alternative,
how can you effectively beat the competition
without being forced to drop your prices,
which at the end of the day hurts you, hurts your business,
ultimately may end hurting your customers as well.
Well that's what this video is all about,
so let's dive right in.
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Hey there my name is Adam Erhart,
Modern Marketing Strategist,
and welcome to the Modern Marketing Show
where we help you make marketing that matters.
So if you're interested in learning about
the latest and greatest marketing strategies,
tools, tips, tricks, and tactics
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The very first thing you need to understand
when it comes to being competitive in the marketplace
is that price is really just one part of the total equation
when a customer is trying go through deciding
which competitor to choose, and which business to
ultimately end up giving their money to.
Now granted, if you're in
a completely cost-conscious market,
where all customers care about is cost
and the lowest provider is always going to win,
than this may not be the video for you
because ultimately at the end of the day,
constantly cutting your prices
is gonna force you to sacrifice margins,
which is gonna roll over into other things
because you're not gonna be able to deliver
the same quality and the same level of service,
or you'll completely destroy your profitability.
But, if you're in an industry
that does have a little more flexibility
and you are willing to kind of step outside the box a little
and really focus on upping the value
and focusing on other things aside from price,
well then this is the perfect video for you,
cause we're going to cover some of my top tips
to really help you do that.
So the first point that we need to talk about,
is all about perceived value.
And really clear here that it's not just value
but perceived value,
because value is a very subjective term
and each customer and each client
is gonna look at it slightly differently.
Now value simply means that the benefit they're gonna get
is going to be higher then the cost they're forced to pay.
So there are things that you can do
rather than just lowering the cost to increase that gap.
Mainly, increasing the benefits
and increasing the value they're getting.
And again, increasing the perceived value,
because some things are gonna matter more to your market,
and it's your responsibility to figure that out
and then deliver it to them.
Now there's a famous sales expression that everybody knows,
which is to under-promise and over-deliver.
Of course, this sounds amazing in theory,
the problem is, is that when a customers
trying to make a buying decision,
they're gonna see that under-promise
and they might be comparing it against one your competitor's
hyped up and hyperbolic and over-promising statements.
Which is why my recommendation here
is to over-promise and over-deliver.
Really, say what you're going to do and then do it,
that's the best way to build trust and consistency,
and really build that relationship with your customers.
Plus, you're not gonna be sacrificing
any of that perceived value
by kind of down playing or understating what you offer.
Just be truthful, just be honest,
you'll customers 'll understand
and appreciate you more for it.
The next point is to do what matters
and only what matters,
and sacrifice everything else that's irrelevant
or totally not important to your ideal customers.
Now we touched on this a little bit
in the previous point, with value being subjective.
Meaning different things are going to matter differently
to different customers.
So it's your job and your responsibility
to go out there and really understand your ideal customers,
what matters to them and what really doesn't matter.
So maybe you can do less of that and do more of the stuff
that they actually care about.
Now there's a number of ways to get this kind of insight
and intel on your customer.
You can run a survey,
you can have customer appreciation nights,
you can call them up directly,
really you could just have a conversation
and figure out what's important to them
and what they really like about your business
and what they wish you may be able to do a little better.
The importance of this really can't be understated,
because there's nothing worse
than dumping a ton of time and money and energy
into building a new product feature
or benefit of your service
that your customers don't even care about.
Likewise, there's nothing worse than taking away something
they actually did care about,
simply because you thought it was irrelevant to them.
The solution here is just to get to know your clients
and customers a little bit better.
The next step in increasing your perceived value
is to display symbols of authority everywhere you can.
Now symbols of authority include things like
social proof, like customer ratings and reviews,
testimonials, maybe even some case studies.
Basically, anything that shows
that you do what you say you're going to do
and you are a credible, trust-worthy business.
Social proof is embedded into our DNA as humans,
which means we really can't avoid it.
When we see what the crowds are doing,
we're inclined to believe
that they're making the right decision
even if it's not right at all.
This means it's incredibly important
to show people just like your ideal customers
that have already had success
with you and with your business.
Social proof, use it everywhere.
Another fantastic tool for beating the competition,
without being forced into a price war,
is using frequency.
You see again, as humans we've been conditioned
to associate frequency with trust,
meaning the more that we see something,
the more it comes up on our radar,
the more experiences we have with it,
the greater and the more likely we are
to know, like, and trust this thing.
This means you should always be seeking
more and more ways to increase touch points
with your customers.
Meaning, you're always finding new and creative
and helpful ways to get your business and your brand
in front of them, on their daily lives.
Now a real quick word of warning,
you don't wanna be spammy with this.
Meaning, you wanna find clever and creative
and new and different angles to approach them with.
This means coming up with different hooks
and really identifying their pains and their problems
and how your business is uniquely positioned to solve it.
Spice up your content and your ads
with different stories and different angles
and different images, graphics, videos, texts,
pretty much anything different
that allows you to kind of present the information
in new and clever ways.
At the end of the day, as long as your message
is focused on them, their pains, their problems,
their frustrations, and how you can help them,
you're gonna be okay.
The next thing we need to cover
is to outspend your competition.
Now this is obviously gonna cost some money,
but the rewards are well worth the sacrifices.
You see, not only should you not lower your prices,
you may actually wanna raise your prices
and then funnel the additional revenue
directly into marketing.
When you do this, a really interesting thing happens.
Just like automatic savings withdrawals
or automatic investments,
well automatic marketing investments
kind of provide the same return
and kind of compounding effect over time, meaning,
that as you continue to increase your marketing investment
and as you spend more and more, as your revenues grow,
there starts to become a wider and wider gap
that your competitors are never gonna be able to fill.
The key here is to really make sure
that you're prioritizing marketing
and that you're investing adequately
in the growth of your business.
By being diligent and consistently setting aside
five percent or 10 percent of your revenue to marketing,
over time this number is going to grow and grow and grow
and you'll be able to continue growing and growing
and growing your business.
Our next competitive strategy is to do the unscalable.
Now the reality is, is that somethings in business
are simply not scalable activities.
These are things that involve your personal time
like reaching out to customers
or providing really exceptional customer service,
or kind of going that extra mile
and really taking up a lot of time
to really serve your customers in the best way possible.
Basically, do all the things that you did
at the very beginning of your business, now.
The beauty is, is that these unscalable things
are incredibly hard to copy if not impossible,
especially by bigger and more established businesses.
After all they'll claim that they're too expensive
or too time consuming or simply not profitable.
And the beauty is, is that those things are all really true
but to have the things that others don't have
you must be willing to do the things
that others aren't willing to do.
And this includes unscalable activities from time to time.
Now a quick warning, I'm definitely not saying
to build your entire marketing campaign
around unscalable activities,
after all they're unscalable.
But that doesn't mean you should inject them
into the business from time to time,
especially if you're trying to gain that competitive edge.
All right, so final tip here
is to take a look at the video below,
which is going to help you avoid the low price monster.
They'll be some marketing pricing strategies
that you can use in your business.
All right, so thanks much for watching,
and I hope you enjoyed the video.
If so, make sure to give it a thumbs up,
subscribe to the channel and say hello
in the comment section below.
And for more great marketing strategies,
tools, tips, tricks, and tactics,
make sure to head over to adamerhart.com.
All right so thanks so much for watching,
I'll catch you next time on the Modern Marketing Show.