Alan Weiss: Wake Up and Smell the Coffee

article series by Alan Weiss

Alan Weiss

The so-called “Java Giants”—Dunkin’ Donuts and Starbucks—have launched simultaneous national expansion plans in the US. That might seem to portend the battle of the morning monoliths but, interestingly, the initiatives present no such traditional competitive warfare.

Dunkin’ and Starbucks have come to the conclusion that they are appealing to vastly differing cults, or tribes. Starbucks is the “welcome to our wireless living room, park your Beemer between the lines” venue, where people delight in using bizarre language to describe the most prosaic of drinks. (Does “vente” really help the process at all?) It is a place to chat and show off your Mac 17” Titanium, or the fact that you’re reading “The Stranger” in the original French.

Dunkin’ is the “how many sugars, don’t just sit there if you’ve finished your sausage/cheese meal, and please don’t leave the pickup in the drive-thru lane” place. It is blue-collar, no-nonsense cups of “Joe,” and the breakfast sandwiches can cause a cholesterol spike that resembles the audio feedback of a train wreck. It’s a place where you talk football, American Idol, and very local politics.

Who Constitutes Your “Tribe”?

Let’s put it this way: When Dunkin’ introduced its grilled sandwich called the Panini, the customers liked the taste but found the name confusing and too high-brow. That same sandwich is currently called “the big melt.” (If Starbucks deigned to provide a warm sandwich, it would no doubt be the “plus elegante croque monsieur.”

All right, I’m getting hungry, so here’s my point. Differentiating yourself, even in markets with “gigante” competitors, is not difficult if you can establish who constitutes your particular “tribe.” Your value proposition is vital (How are customers better off once you walk away?) but the stratification of your universe of potential customers for that value can determine just how cost-effective and productive your marketing will be.

Consultants who approach the market with the opportunity that their customer is “anyone who can pay my fee for any of my competencies” may be maximizing their potential buyers, but they are also maximizing their actual competition. It seems to me that the point is to produce the most high-quality net prospects, not total prospects. In other words, it’s better to have 100 prospective buyers who find you substantially differentiated than it is to have 1,000 prospects who don’t see you as differentiated at all.

I don’t believe in “specialize or die” or any of that polarized thinking. I do believe, however, that if your buyers are the heads of sales, for example, you may be better off if you can determine whether they are in large companies or small, for-profits or non-profits, government or education. It may also make a difference whether they are start-up or mature, domestic or global, leading their industries or also-rans.

Starbucks and Dunkin’ can co-exist forever. In fact, they would probably suffer if either tried to appeal to the other’s constituency. We all control our marketing efforts, our sales approach, our brands, our collateral, our conversation. Do you know who your top-priority prospective buyer is with some differentiation, or do you simply believe “it’s the sales department”?

“Nice, But We Don’t Need That…”

Your size and background don’t dictate your tribal targets, but your value proposition does. Bear in mind that some prospective markets are much tougher than others. For example, family-owned businesses, education, and government are the three toughest market segments I’ve ever observed. Many people work in them successfully, but it’s rare to find one of those successful people also working in Fortune 100 firms or in entrepreneurial start-ups. It’s done, but it’s not the rule.

It’s tough to be all things to all people, even with a powerful brand. (You generally need powerful brands, plural, to appeal to vastly differing market segments.)

Here is some help in differentiating your target markets:

  • First, think of the particular buyer who will pay money for your value, not a firm or general market. Individuals buy services, not entities.
  • Ask yourself what attributes of those buyers are most attractive and/or relevant for you. For example, is it a rapid-growth mindset, a deliberative pace, a huge span of control, a tightly controlled group, a market leader or market laggard?
  • Use just a couple of adjectives to aid the differentiation. (Don’t use too many or no one will need you, e.g., “I’m a telemarketing consultant specializing in outbound sales of mortgage products in the $250,000 range for new construction only in the northeast.” “Well, that’s nice, but we don’t need that.”) A good example would be, “We assist sales leaders of large service operations to reduce closing time and associated costs of acquisition.”
  • If you have multiple capabilities, consider multiple brands, Web sites, promotional material, and so forth. Very, very few consultants, for instance, are successful in marketing to small and large firms with the same materials and promotion. But some have done it with differentiated promotion and materials.

Take charge of your own marketing and perception, and don’t leave them to the market or the competition. Identify your top-priority probable constituency within the realm of all possible buyers.

Enjoy your next chai, soy, vanilla mocha whatever, or your next giant iced coffee, whatever it is. But the odds are you’re not getting them in the same place. Make sure you hold a very special place for your true prospective buyers.

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