Does your business have a Unique Selling Proposition? When it comes to individuals, uniqueness ranges from our DNA, to the sound of our voice, and even to our fingerprints. Therefore, logically it would seem that every business owned by a unique individual would in some way have a unique identity in the marketplace. While this is true, your business—as an entity apart from its owner—should also have characteristics that make it unique in the eyes of the customer and other stakeholders that will potentially do business with the company.
BusinessDictionary.com defines a unique selling proposition (USP) as the “real or perceived benefit of a good or service that differentiates it from the competing brands and gives its buyer a logical reason to prefer it over other brands. USP is often a critical component of a promotional theme around which an advertising campaign is built.” This definition highlights three primary components that an entrepreneur should consider when pinpointing a USP.
First, a differentiated business is much more likely to succeed than a business that cannot easily be distinguished from the competition. Consider the Verizon smart phone. Despite countless commercials from other cell phone carriers vying for customers’ business, for more than a decade, Verizon has consistently convinced more than 30 percent of the cell phone market that it provides superior products and services. How and Why? Because their frequent and ubiquitous delivery of the message that “better coverage matters” has been engrained into consumers’ purchasing DNA. The company’s ability to deliver on that promise helps strengthen its USP and customer loyalty.
Second, a business that completely provides the benefit a customer is seeking is in a much stronger position to win business than a company that only partially or inconsistently fulfills a need. This concept brings to mind Walmart; a mega-retailer that sells its customers on saving money. Customers know they can get the same brand of cereal, soap, ketchup, and ice cream at many different stores. However, many customers will drive a greater distance and spend additional time in Walmart because they believe they will gain the benefit of saving money for the effort. Conversely, other grocery stores may sell their customers on speed, customer service, or convenience and also have success. The idea here is that your business must identify the benefit its target customers are seeking and become an expert at delivering this benefit consistently.
The third component a business must identify when creating a USP is how the product will entice customers to prefer the product over others. In reality, customers are complex beings who often weigh the pros and cons between several factors when making a buying decision. A customer will typically consider factors like cost, convenience, quality, speed, and consistency when looking at a product and then make a decision. A company’s USP must mix these factors to market a product that entices customers to prefer its mix of factors over the competition.
Starbucks is one of the most profitable food and beverage brands in the world. Does Starbucks coffee taste better? Maybe -maybe not. Is Starbucks more convenient, speedy, or less expensive? Maybe; but, probably not. However, Starbucks customers are extremely loyal to the Starbucks brand. Any entrepreneur would be wise to create ways to entice customers to prefer its product over other competing products through its branding, marketing, advertising, and customer service efforts.
The bottom line is that a USP is a planned and executed strategy for communicating to customers the reason they should buy your product instead of your competition’s. It is not a quick or easy strategy that will propel your business into success overnight; but it will create a stronger, more reliable, and more profitable customer base over time. The reason for this success is because, just like the uniqueness of your personal DNA, your customers will know your business DNA and be able to identify your company specifically. And this intimate knowledge will allow them to know why they choose to do business with you—over and over again. If you’d like to learn more about strengthening your business and establishing your company’s Unique Selling Proposition, visit The Institute online at www.TheInstituteNC.org for more information about various business development programs.