My last blog post, about positioning, was titled Stand for Something. This blog is about a potentially effective way to position your product or service that you might not have thought about.
A former client of mine was struggling with how to position their flagship product, a multi-hundred thousand-dollar system used in memory manufacturing.
For all intents and purposes, the client’s system was identical to the competitor’s system. Consequently, the client found themselves in a price war for every order because they couldn’t explain why their system was better—on paper, it seemed pretty comparable.
But during the analysis, we learned about one critical component of these systems: a (mostly) hand-made part that weighs more than a ton. No one keeps this part in stock because it a) is massive and b) rarely fails.
But when it does fail, production grinds to a halt. There is no workaround, and the lead time for replacement is approximately 90 days. All that downtime means a loss of hundreds of thousands of dollars, or even millions of dollars.
Unfortunately (for them), the competitor’s product had experienced two such failures over ten years. My client’s product, on the other hand, had never experienced this type of failure.
As you can imagine, this little bit of knowledge was worth a great deal to my client—and my client’s customers. Once we started incorporating this fact into the sales process, my client was able to raise prices by more than 15%, all of which went directly to the client’s bottom line.
When you’re figuring out your positioning, you can and should consider all the good things your product or service does. But it’s also important to consider all the bad things it can help your customers avoid. Sometimes, plain old “peace of mind” is worth a great deal in real dollars and cents.
Next time, I’ll provide some suggestions for effectively positioning various types of analytical equipment.