Competition and Conversation
Al Kenney | February 18th, 2013
The Art of Marketing
I have received many questions since my first article, so starting this month I’ve selected a question to answer that has broad relevance across the M.A.D. readership (no names will be used). No business question can be answered simplistically as there are always many factors to consider, all of which have a unique impact on each individual situation. I will continue to piece together a marketing strategy, offering an additional framework component in each issue.
Last month I covered creating a mission statement, defining a niche market, and developing a SWOT analysis as the first three building blocks in putting together a successful strategic marketing plan.
This month we begin to look at competition.
Step 4: Identify and explore your competition
How many of you watch what your competition is doing? Everyone should. Maybe a better question is: who do you consider your competition to be?
Many successful companies have expanded their view of the competition, and this has had a positive impact their on businesses. In the early 1990’s the thinking in the supermarket industry was that competition originated from other supermarkets, which they watched very carefully, and most supermarkets were a carbon copy of one another. Not much innovation was happening. A few very progressive food retailers began to take a wider view of their industry and decided their competition was every company that sold food (i.e., restaurants, fast food businesses, etc.).
Once these companies had a broader view of the competition, they began to adapt in response to their newly expanded market. More prepared foods sections started popping up: salad bars, pizza, and hot and cold sandwiches could now be found in the supermarket. Supermarkets made space to enable them to go head-to-head with fast food restaurants. These progressive retailers started a positive growth trend in the industry that continues today, all because they opened their eyes wider and saw something others didn’t.
If you have read any business strategy books, you have seen that successful companies make studying their competition part of their routine. Why do they do this? It works. When analyzing your competition, however, you must know what to look for. It’s not about simply copying their ideas; it’s about figuring out their strategies and motivation. It’s also important to look for the things they aren’t doing. Maybe you’ve been in the business so long that “you can’t see the forest for the trees,” as they say. You may need to approach things from a new angle and mindset and with a fresh set of eyes.
There are many stories these days in which the people who are solving major industry problems are not from that industry. The reason is that people in that industry have “learned apathy” and can’t see the status quo drivers clearly enough to make a change. The key is not to look at things the way you are used to looking at them and not to take for granted those things that have been a part of your industry for such a long time that you think they can’t be changed.
It’s very difficult for antiques dealers to benchmark themselves! You can’t easily look up and see what your share of the market is.
Competition is everywhere. Yes, it can be frustrating, but it can also help bring out the best in you. No matter what segment of the business you’re in, you will benefit greatly from studying your real competition. Today you’ve got both direct (down the street) and on-line competition. Customers are becoming more comfortable using the Internet to buy goods and services, so you are no longer competing with your immediate neighbors. The younger generation that the antiques industry is trying to attract would rather be on the Web than play with their friends face to face. Like it or not, you are now competing with businesses from across the globe.
Every business can benefit from having a good Web site. What does this mean for the average antiques dealer? Depending on what you are selling, other antiques dealers are only part of your competition. For example, if you sell any kind of furniture maybe your real competition is regular furniture stores. Many years ago, my wife and I started collecting antiques to furnish our first home. Like most young couples starting out we had a very limited budget. We looked in many furniture stores, but we were uninspired by the designs (which were too straight-lined or copies of older styles). Also, the better-quality new furniture was selling for outrageous prices.
Luckily we lived in an area that had a few antiques shops, and we began to notice that refinished oak tables, chairs, and dressers were much cheaper, sturdier, and more interesting to us than the new, let’s say “shabbily” made, stuff from the furniture store. Why buy a copy when you may be able to have the original for less?
To make a long story short, our incomes increased and our tastes evolved to higher-quality antiques. Over the years we sold every oak piece we bought for a good deal more than we paid for it way back when! If we had bought that new furniture, then it would have been out on the curb by now and the return on our investment would have been zero.
I’m not sure the message is getting through to the 20-somethings that buying antiques is a better long-term strategy in terms of value and aesthetics. Maybe you need to educate potential clients so that they see that antiques are a better long-term value than new furniture. Nothing demonstrates the value better than seeing a side-by-side comparison, which may be the beginning of the education process for your new customer base.
What you need to know about your competitors:
Monitor the way your competitors do business. Look at:
• The products and services they provide to their customers and how they reach them
• The prices they charge
• Whether they are innovative
• Media activities: Web site and advertising
• Shows: What are they exhibiting? How do they exhibit it? Who visits them?
• How they use technology to sell and market
Go on line; look at competitors’ Web sites. Find out how they compare to yours. Check any interactive parts of the site to see if you can get ideas for improving your own Web site. Is it updated frequently? Are products easy to find?
Question of the month:
“I am the chairperson for a long-running antiques show. I want to ask if you had any advice to give us to attract not just walk-in customers but potential buyers. We are having issues with a dwindling gate as well as sales. The population coming through our door is older, and in my opinion, many are there to evaluate their own items, not to buy new ones. We are local dealers, many of whom have been in the business for years. What can we do to promote our image and get more buying customers to our show?”
Unfortunately there is no magic pill that can be taken for the situation described here. This is a two-part problem. The first part highlights the promoter’s and chairperson’s joint responsibility to get a high number of people to the show.
Thinking about the complexity of this problem, the length of the answer, and which part of the response would be the most valuable to most M.A.D. readers, I’m going to focus on the second part of the question for now. How do we influence potential customers to buy?
Let’s assume the chairperson was successful in getting a good number of the show’s target audience through the gate. The first thing that came to mind is the old adage “You can lead a horse to water but you can’t make him drink.”
While researching the answer, I came across more than 30 “forces” that marketers believe influence people to buy. From that list I narrowed it down to the top ten influences that I believe are associated with the antiques trade. They are:
- Scarcity: A perception that something may run out or have limited availability in the future.
Investment: A hope to gain a positive return on investment, such as fine artwork, antiques, or anything that one believes will accrue value over time. - Prestige or aspirational purchase: A purchase for an esteem-related reason or for personal enrichment. Can also be a purchase made to impress others, make the buyer look like an aficionado, and/or achieve a standard of social status.
Emotional: Replacement or acquisition of items that meet a perceived emotional need. - Value: A high perceived value to the buyer. The purchase may not be something they need, but they feel it is too good a deal to pass up.
- Fad: Everybody wants the latest thing.
- Niche: An item that helps you bond to a cultural, religious, educational, or community affiliation.
- Addiction: This accounts for more sales than any of us can imagine. Think back to the last time you bought something but could not fully explain why.
- Indulgence/reward: Everyone deserves a little luxury now and then!
- Historical significance: Items that have played a part in history (some may be one-of-a-kind items).
There are also many outside factors that affect these ten buyer “psychological need states.” The biggest one today is the sputtering economy. No matter what we do we can’t move the economy in a positive enough direction to get a potential customer to make a purchase. In order to actually generate a sale in the antiques business, you must move a potential customer into one or more of these “buying states.” To do so you will have to work on your sales aptitude. That’s right; everyone is going to have to become a better salesperson! Products don’t sell because you have bills to pay or you have needs to be met. In fact, if you ever hope to sell anything, you have to get “me” out of the equation and focus on your customer’s needs. Provide core reasons for your customer to buy, and the sale becomes much easier.
My grandmother used to tell me that one of my uncles would make a great salesperson because “he had the gift of gab.” These days only asking potential customers in your booth to “let me know if you have any questions” may not be good enough.
So why do customers buy?
People are compelled to buy when the products or services they are looking at mesh well with their perceived needs. Until people can see the utility in what you are offering for sale they won’t buy it. Think about what need you are fulfilling for your potential customer and what desired state you are creating.
Meeting a perceived need. One could say that an antiques purchase does not meet a “primary need” for your potential customer (i.e., food, water, shelter). So what will this item do for them? The satisfaction derived from a particular product or service equals its perceived value. How well do you understand the psychological needs of your target customers? How relevant is your product to these needs? The closer you can come to meeting their need in their own mind, the better chance you have of selling to them.
Credibility. Why should they buy this item? The second reason why customers buy is credibility. Customers buy items they think they need from people they trust. After a customer sees the utility in what you are offering for sale, the next thing they want to see is credibility. Can you and your product deliver this? This is imperative for making the sale.
Relevance. Why should they buy it now? Potential customers may see the value in your offering and may trust your ability to deliver, but is what you are selling relevant to your customer’s current situation? People are interested in what you are offering for sale, and based on your track record, they may even trust your “brand,” but how well does your item suit their current needs? To successfully get potential customers over the final purchase “hump” two key selling skills are required: skillful questioning and skillful listening.
To uncover the relevance of your product/service to the current needs of the customer, you’ve got to dig below the surface. People naturally find it difficult to express their deep desires unless they are skillfully led. If you can ask questions that uncover their need and listen carefully and patiently to their answers, the more you will find your potential customers will open up and talk to you. Psychologists have found that if you allow people to talk freely, they will eventually tell you what their real feelings are.
Your goal is to create an environment where all potential customers (that means even the younger ones) feel comfortable expressing themselves honestly. Your goal is to create a comfortable environment by combining your personality, inventory, and knowledge. The hardest part is already done, i.e., you have the potential customer there in front of you! Now you must ask open-ended questions and listen carefully and patiently to their answers with minimal interruption. If you can do this you will be in control of the conversation. Once your potential customer voices his or her ultimate concern about the purchase, the relevance of your offering will be much clearer to him or her and the desire to buy now will be present.
Feel free to e-mail me if you have potential topics you want me to cover or if you have comments. I can be reached at <al@alpha1c.com>.
The Art of Marketing
Competition and Conversation
by Al Kenney
I have received many questions since my first article, so starting this month I’ve selected a question to answer that has broad relevance across the M.A.D. readership (no names will be used). No business question can be answered simplistically as there are always many factors to consider, all of which have a unique impact on each individual situation. I will continue to piece together a marketing strategy, offering an additional framework component in each issue.
Last month I covered creating a mission statement, defining a niche market, and developing a SWOT analysis as the first three building blocks in putting together a successful strategic marketing plan.
This month we begin to look at competition.
Step 4: Identify and explore your competition
How many of you watch what your competition is doing? Everyone should. Maybe a better question is: who do you consider your competition to be?
Many successful companies have expanded their view of the competition, and this has had a positive impact their on businesses. In the early 1990’s the thinking in the supermarket industry was that competition originated from other supermarkets, which they watched very carefully, and most supermarkets were a carbon copy of one another. Not much innovation was happening. A few very progressive food retailers began to take a wider view of their industry and decided their competition was every company that sold food (i.e., restaurants, fast food businesses, etc.).
Once these companies had a broader view of the competition, they began to adapt in response to their newly expanded market. More prepared foods sections started popping up: salad bars, pizza, and hot and cold sandwiches could now be found in the supermarket. Supermarkets made space to enable them to go head-to-head with fast food restaurants. These progressive retailers started a positive growth trend in the industry that continues today, all because they opened their eyes wider and saw something others didn’t.
If you have read any business strategy books, you have seen that successful companies make studying their competition part of their routine. Why do they do this? It works. When analyzing your competition, however, you must know what to look for. It’s not about simply copying their ideas; it’s about figuring out their strategies and motivation. It’s also important to look for the things they aren’t doing. Maybe you’ve been in the business so long that “you can’t see the forest for the trees,” as they say. You may need to approach things from a new angle and mindset and with a fresh set of eyes.
There are many stories these days in which the people who are solving major industry problems are not from that industry. The reason is that people in that industry have “learned apathy” and can’t see the status quo drivers clearly enough to make a change. The key is not to look at things the way you are used to looking at them and not to take for granted those things that have been a part of your industry for such a long time that you think they can’t be changed.
It’s very difficult for antiques dealers to benchmark themselves! You can’t easily look up and see what your share of the market is.
Competition is everywhere. Yes, it can be frustrating, but it can also help bring out the best in you. No matter what segment of the business you’re in, you will benefit greatly from studying your real competition. Today you’ve got both direct (down the street) and on-line competition. Customers are becoming more comfortable using the Internet to buy goods and services, so you are no longer competing with your immediate neighbors. The younger generation that the antiques industry is trying to attract would rather be on the Web than play with their friends face to face. Like it or not, you are now competing with businesses from across the globe.
Every business can benefit from having a good Web site. What does this mean for the average antiques dealer? Depending on what you are selling, other antiques dealers are only part of your competition. For example, if you sell any kind of furniture maybe your real competition is regular furniture stores. Many years ago, my wife and I started collecting antiques to furnish our first home. Like most young couples starting out we had a very limited budget. We looked in many furniture stores, but we were uninspired by the designs (which were too straight-lined or copies of older styles). Also, the better-quality new furniture was selling for outrageous prices.
Luckily we lived in an area that had a few antiques shops, and we began to notice that refinished oak tables, chairs, and dressers were much cheaper, sturdier, and more interesting to us than the new, let’s say “shabbily” made, stuff from the furniture store. Why buy a copy when you may be able to have the original for less?
To make a long story short, our incomes increased and our tastes evolved to higher-quality antiques. Over the years we sold every oak piece we bought for a good deal more than we paid for it way back when! If we had bought that new furniture, then it would have been out on the curb by now and the return on our investment would have been zero.
I’m not sure the message is getting through to the 20-somethings that buying antiques is a better long-term strategy in terms of value and aesthetics. Maybe you need to educate potential clients so that they see that antiques are a better long-term value than new furniture. Nothing demonstrates the value better than seeing a side-by-side comparison, which may be the beginning of the education process for your new customer base.
What you need to know about your competitors:
Monitor the way your competitors do business. Look at:
• The products and services they provide to their customers and how they reach them
• The prices they charge
• Whether they are innovative
• Media activities: Web site and advertising
• Shows: What are they exhibiting? How do they exhibit it? Who visits them?
• How they use technology to sell and market
Go on line; look at competitors’ Web sites. Find out how they compare to yours. Check any interactive parts of the site to see if you can get ideas for improving your own Web site. Is it updated frequently? Are products easy to find?
Question of the month:
“I am the chairperson for a long-running antiques show. I want to ask if you had any advice to give us to attract not just walk-in customers but potential buyers. We are having issues with a dwindling gate as well as sales. The population coming through our door is older, and in my opinion, many are there to evaluate their own items, not to buy new ones. We are local dealers, many of whom have been in the business for years. What can we do to promote our image and get more buying customers to our show?”
Unfortunately there is no magic pill that can be taken for the situation described here. This is a two-part problem. The first part highlights the promoter’s and chairperson’s joint responsibility to get a high number of people to the show.
Thinking about the complexity of this problem, the length of the answer, and which part of the response would be the most valuable to most M.A.D. readers, I’m going to focus on the second part of the question for now. How do we influence potential customers to buy?
Let’s assume the chairperson was successful in getting a good number of the show’s target audience through the gate. The first thing that came to mind is the old adage “You can lead a horse to water but you can’t make him drink.”
While researching the answer, I came across more than 30 “forces” that marketers believe influence people to buy. From that list I narrowed it down to the top ten influences that I believe are associated with the antiques trade. They are:
Scarcity: A perception that something may run out or have limited availability in the future.
Investment: A hope to gain a positive return on investment, such as fine artwork, antiques, or anything that one believes will accrue value over time.
Prestige or aspirational purchase: A purchase for an esteem-related reason or for personal enrichment. Can also be a purchase made to impress others, make the buyer look like an aficionado, and/or achieve a standard of social status.
Emotional: Replacement or acquisition of items that meet a perceived emotional need.
Value: A high perceived value to the buyer. The purchase may not be something they need, but they feel it is too good a deal to pass up.
Fad: Everybody wants the latest thing.
Niche: An item that helps you bond to a cultural, religious, educational, or community affiliation.
Addiction: This accounts for more sales than any of us can imagine. Think back to the last time you bought something but could not fully explain why.
Indulgence/reward: Everyone deserves a little luxury now and then!
Historical significance: Items that have played a part in history (some may be one-of-a-kind items).
There are also many outside factors that affect these ten buyer “psychological need states.” The biggest one today is the sputtering economy. No matter what we do we can’t move the economy in a positive enough direction to get a potential customer to make a purchase. In order to actually generate a sale in the antiques business, you must move a potential customer into one or more of these “buying states.” To do so you will have to work on your sales aptitude. That’s right; everyone is going to have to become a better salesperson! Products don’t sell because you have bills to pay or you have needs to be met. In fact, if you ever hope to sell anything, you have to get “me” out of the equation and focus on your customer’s needs. Provide core reasons for your customer to buy, and the sale becomes much easier.
My grandmother used to tell me that one of my uncles would make a great salesperson because “he had the gift of gab.” These days only asking potential customers in your booth to “let me know if you have any questions” may not be good enough.
So why do customers buy?
People are compelled to buy when the products or services they are looking at mesh well with their perceived needs. Until people can see the utility in what you are offering for sale they won’t buy it. Think about what need you are fulfilling for your potential customer and what desired state you are creating.
Meeting a perceived need. One could say that an antiques purchase does not meet a “primary need” for your potential customer (i.e., food, water, shelter). So what will this item do for them? The satisfaction derived from a particular product or service equals its perceived value. How well do you understand the psychological needs of your target customers? How relevant is your product to these needs? The closer you can come to meeting their need in their own mind, the better chance you have of selling to them.
Credibility. Why should they buy this item? The second reason why customers buy is credibility. Customers buy items they think they need from people they trust. After a customer sees the utility in what you are offering for sale, the next thing they want to see is credibility. Can you and your product deliver this? This is imperative for making the sale.
Relevance. Why should they buy it now? Potential customers may see the value in your offering and may trust your ability to deliver, but is what you are selling relevant to your customer’s current situation? People are interested in what you are offering for sale, and based on your track record, they may even trust your “brand,” but how well does your item suit their current needs? To successfully get potential customers over the final purchase “hump” two key selling skills are required: skillful questioning and skillful listening.
To uncover the relevance of your product/service to the current needs of the customer, you’ve got to dig below the surface. People naturally find it difficult to express their deep desires unless they are skillfully led. If you can ask questions that uncover their need and listen carefully and patiently to their answers, the more you will find your potential customers will open up and talk to you. Psychologists have found that if you allow people to talk freely, they will eventually tell you what their real feelings are.
Your goal is to create an environment where all potential customers (that means even the younger ones) feel comfortable expressing themselves honestly. Your goal is to create a comfortable environment by combining your personality, inventory, and knowledge. The hardest part is already done, i.e., you have the potential customer there in front of you! Now you must ask open-ended questions and listen carefully and patiently to their answers with minimal interruption. If you can do this you will be in control of the conversation. Once your potential customer voices his or her ultimate concern about the purchase, the relevance of your offering will be much clearer to him or her and the desire to buy now will be present.
Feel free to e-mail me if you have potential topics you want me to cover or if you have comments. I can be reached at
