July 6, 2007
George's Going to Market: Selling a Commodity? Baloney!
Todd's Tidbits: It'll Take More Than That to Stop Us
Greetings!
Was that June I just saw pass us by? How does that happen?
Well, this month I’d like to share with you one of my favorite newsletters that I subscribe to. Jeff Blackman puts out The Results Report (although it doesn’t really report on specific results, what the heck—name it whatever you'd like, Jeff). Jeff’s a sales consultant and sought-after speaker who puts together a nice little collection of interviews, thoughts and personal experiences that I find very valuable. He’s also a home boy and Cubs fan. His kid stories are pretty funny, too.
The following is an example of what you might find in his newsletter. It hit home in his recent release because we were talking recently about solicitors coming into our office. I always have a soft spot for the salesperson who has the grit to make a cold call. I also feel for our associates who happen to sit closest to the front door. But you never know who that copier saleswoman might know—maybe her cousin could be our next new client!
| JEFF, SO WHATTA YA THINK? |
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Question: Jeff, I am a CEO, and my folks were recently having a "good natured" debate about which department, team or individual is more important, i.e., service, sales, ops, credit, etc. What's your opinion? |
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Answer: Did you then solve the chicken and the egg dilemma?! Interesting question. Kinda like asking, "Which is more important in a car...the steering wheel or the brakes?" Obviously, without sales, there's nothing to do. But wait, without talented service pros, there might be nothing to sell next time. Hmmm, and those folks in finance, credit and accounting keep track of all those dollars. And, if manufacturing doesn't make it, it can't be sold. And if it can't be sold, it can't be bought. Did your receptionist vote? After all, he or she is your first voice to the world, your director of first impressions. And, how 'bout your role as the CEO and the contributions of your leadership team? What if together, you don't create a culture of trust, value, vision and accountability?  Let me give you another perspective. Years ago, I had the pleasure to consult with the team at the Chicago O'Hare Hilton. Their General Manager was Bruce Ulrich, a wonderful guy, who told me something I never forgot. He said, "Jeff, do you know who some of the most important members of my team are?" I replied, "Who and how come?" He answered, "My custodial team. Especially those who clean the bathrooms near our lobby, front desk and restaurants." Bruce went on to explain, "We're part of O'Hare Airport, so our lobby or first floor is a busy place. Folks grabbing a quick meal. Relaxing on a layover. Or, conducting a meeting. And, when they enter those first floor bathrooms, they're forming opinions. Not just about the bathroom(s), but the entire hotel. If the sinks, floors or toilets are dirty, they begin to wonder about the cleanliness of our sleeping rooms, the quality of our food, the functionality of our meeting space and our hospitality commitment to our guests." Bruce further emphasized, he let his custodial team know the value they brought and the significance they played, not just in the hotel's "bathroom beauty," but in the hotel's performance and profitability. So I guess, the answer is obvious. Your most important person is... |
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Reproduced with permission from Jeff Blackman's free e-letter, The Results Report. Jeff is a speaker, author, business-growth specialist, success coach, broadcaster and lawyer. Contact Jeff at 847.998.0688 or to subscribe, visit www.jeffblackman.com. Copyright - Blackman & Associates, Inc. |
Subscribe to Jeff’s newsletter. I think you’ll like the other content too.
Tim Padgett
tim@peppergroup.com
“Always render more and better service than is expected of you, no matter what your task may be.”
—Og Mandino
“Be silent as to services you have rendered, but speak of favours you have received.”
—Seneca
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Mindbender
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George's Going to Market: Selling a Commodity? Baloney!
Marketing helps differentiate your product or service to deliver higher margins. But what if your product or service is, by nature, somewhat undifferentiated? What if you’re in a price-competitive industry like trucking or equipment rental? Are you doomed to competing on price? Worse yet, what if you sell cement? Or office whiteboards? What about bricks?
Anything can be differentiated. To help prove it, here are three quick profiles of companies that have turned actual commodities into highly-profitable products. They rejected the traditional approach within their industries and identified how and where they could deliver a higher level of value. This strategic marketing approach has helped these companies thrive in a sea of commodity competitors.
| Cemex | ||
| Think 99-year-old cement manufacturer headquartered in Mexico. Does it bring thoughts of cutting-edge strategic marketing? Perhaps it should. Cemex gets a price premium for its regular-old cement, and the company has become the third-largest cement manufacturer in the world—and by far the most profitable. How? Cemex threw out the standard 4-hour delivery window by leveraging advanced technology to enhance logistics and dramatically narrow delivery times. They realized that their customers, building contractors, would find great value in not having their crews waiting around for the cement trucks. Cemex’ customers can easily justify the premium cement cost through higher crew efficiency and improved productivity. |
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| Magnatag | ||
| You may not have heard of them, but you’ve probably seen these products on the set of ER or at a company near you (like the Pepper Group). Rather than selling generic whiteboards and trying to compete on price against larger, cheaper competitors, Macedon, NY based Magnatag tailors their whiteboard systems to the needs of specific applications. The boards have pre-printed grids and graphics, and come with customizable accessories including magnets, holders and lettering. Though the company technically manufacturers whiteboards, what they sell are detailed organizational systems spanning more than 2,300 different applications. This differentiation has allowed Magnatag to grow and profit selling a product that otherwise would be seen as a generic, mass-produced commodity. |
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| Acme Brick | ||
A brick is a brick, but an Acme Brick sells for 10% more .Unlike any other brick maker, Texas-based Acme does not limit their marketing to contractors and distributors, nor are they shy about investing in marketing. With a budget exceeding $1.5 million per year for their 6-state market area, Acme has built a powerful consumer brand. Troy Aikman is the company’s spokesperson. Residential bricks are stamped with the Acme logo so home buyers know whether the home has Acme bricks. And in 1995, Acme introduced a 100-year guarantee which has proven to have solidified the perception of quality and clearly positioned Acme bricks as the best in the market. Acme has proven that differentiation is possible for any product and, more importantly, that branding pays. In fact, surveys reveal a consumer preference rate north of 80% for Acme bricks. Every other brick is “generic.” What this means is that Acme enjoys a solid base of loyal customers, builders who are afraid to use anything else on a spec home, and a price premium which translates into a more than 13-fold ROI on its marketing investment. |
How are you differentiating your products and your organization? Let’s sum up the main lessons from the stories above:
- Expand your thinking
Cemex looked beyond the product to find value in superior logistics. - Be more creative
Magnatag turned whiteboards into complete organizational systems. - Use ideas from other industries
If you can brand sugar water, you can brand a brick.
And the most important lesson of all? You don’t ever have to settle for competing on price alone.
George Couris
george@peppergroup.com
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Todd's Tidbits: It'll Take More Than That to Stop Us
What do you get when you mix 1,888 charitable cyclists, 120 miles of rural roads, 60º temperatures and eight hours of rain? Well on the weekend of June 23-24, the result was nothing short of a grand adventure. The MS Bike Tour de Farms is an annual two-day bicycling event that benefits the Greater Illinois Chapter of the National Multiple Sclerosis Society. Participants solicit donations for the MS Society and choose to ride 36-, 78- or 103-mile routes each day. Eight fully-stocked rest stops were spaced along the routes and the motorcycle support crew did a fantastic job of helping to direct traffic and keep cyclists out of trouble.
Not everyone who signed up to ride actually ventured out into Saturday’s inclement weather, but those who did felt especially proud. One rider in particular, our own Tim Padgett, deserves special recognition for finishing the entire rain-soaked 78-mile route. Particularly since his longest previous bike ride had been 25 miles (on the Sunday before)!
Tim and I started out riding with my two daughters—the eldest on her own bike and the youngest on the back of my tandem. Thirty miles into the day, the girls were shivering uncontrollably and an opportune offer to transport them to the finish from our friend Patti Gates was too good to pass up.
After the girls were safely bundled away in Patti’s heated van, Tim and I set off to prove ourselves stronger than the elements. Personally, I think the weather was easier to handle than the constant remarks from other riders about me having lost my back seat rider.
Upon arrival in DeKalb, the rain had stopped and the Saturday overnight festivities—live music, catered food and even a public wedding—were wonderful. The colorful Team Tent Village—twenty-four tents decorated by rider teams for their own relaxation—made everything more enjoyable.
On Sunday, the weather was much more cooperative and, although it was quite a challenge for them, my daughters completed the whole 78 miles to the finish line.
To date, our team of twelve riders (The Chainring Gang) has raised more than $10,000 for the National MS Society and the entire event has raised almost $1.5 million! There are still two months of fundraising remaining so feel free to visit www.msillinois.org for more information.
Todd Underwood
todd@peppergroup.com
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