Is your business in a position for success? They’re three areas of your business that you need to make sure are aligned so that you can be successful. When talking about these three areas we are going to use a triangle to help explain each area. The goal is to strive to make your business be positioned in the upper tier of the triangle. This leads to a greater chance of succeeding.
You are in business because you are fulfilling a need for a client or customer, so that’s the base of this triangle. If you can’t do that, you’re not going to be in business for a long time at all. You have services, programs, that help you fulfill the client’s needs. This can be called skill sets. Then the top tier of the triangle part is being unique. It’s a competitive world out there. It is important that you strive to make your business unique as possible while being able to fulfill your client’s needs and provide a skill set equal to or greater than your competition. That is how you differentiate your business.
How would you compare to your competition? Just like before we have a triangle split into three sections. This time these sections represent how your business is compared to your competition. Is it below, similar/equal to, or above your competition? To help us find out where we are versus the competition we will look at two things; the value and the price.
Let’s say for example, that a client put the value of your product similar to the competition. Now let’s look at the price, the goal is to have your price at the same level as your perceived value from the client. However, sometimes this is not the case. Some people have the price above the perceived value, which leads to people not buying based on the fact they don’t feel that they are getting their money back. On the other hand, sometimes people put the price lower than the value, this leads to people buying but the company loses out on the potential money they could have got.
Our last area also calls for our last triangle. We have at the base of our triangle our cost-oriented clients. The ones who are only concerned about getting the lowest price possible. At the top tier, we have the value-oriented clients, who look for the greatest value in a product or service compared to the rest, and are willing to pay a premium for this value. And finally, in the middle, we have the clients that are a mix, want good value for a product or service but do not want to pay too much for. So the question is, where’s your target audience? Where are you targeting?
Now we’re going to put all three together: your business, your competition, your clients. You know where you want to be in each area, but more importantly, you want to make sure all your points are lined up with each other.
Let’s say you’re in the second tier of the business triangle, you fulfill your client’s needs and you provide a skill set equal or even better than the competition, however, you are not that unique. You want to make sure you are lining up your business with the second tier of the other two areas, similar/equal to the competition and mix of price/value-oriented clients.
In this example when it comes to the client’s triangle if you are in the second tier you could always try to sell to the value and price-oriented clients, along with your mixed clients.
But you can’t sell to clients that are two spaces from your line. Let’s say you’re a high-end company, you are not selling to the price-oriented clients, based on the fact the price will be higher than they want to pay, disregarding the great value they could get by your product or service. Visa versa you are not selling to value-oriented clients if you are a base level company. The value-oriented clients will not see the value of the product or service based on how cheap your company is compared to the rest of the competition.
If possible it is important that you are not striving for the base-level tier. You want to be in the second tier or third tier of the triangles. Based on the fact if the economy goes bad, people who are price-oriented can not afford products or services no longer, and the companies lose their client base, causing them to struggle to stay in business.
You got to keep all your areas in line. If you keep them in line, you’re going to be better off with positioning a successful business.