Chocolate pricing

Make your business different or have a low price

Graham McGregor is a marketing consultant.

OPINION: I recently caught up with a former client named Larry.

I hadn’t seen Larry in over 10 years, and he called me to ask if I would like some of the books from his professional library.

Larry had worked in the radio industry for many decades, and as he was now retired he was trying to find a good place for some of his books.

Larry and I had coffee and a good chat and I happily took home a few dozen of his books.

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I’ve forwarded a few to people I think might find them useful. And a number that I read myself.

One of the books I read by Larry is called The Power of Simplicity by Jack Trout.

Jack was the business partner of marketing legend Al Ries and enjoyed many of the books they wrote together.

In Chapter 7 of The Power of Simplicity, Jack makes this interesting comment: “If you’re not different, you better get a low price.”

It reminded me that being different is a great way to make your business stand out in a crowded market.

Andy MacDonald / Taranaki Daily News

By reducing the size of products, companies can charge more without increasing prices.

Fortunately, there are hundreds of simple things you can do to differentiate your business from your competitors.

Here are 3 “be different” marketing strategies to get you thinking.

Strategy 1: The Catchy Nickname

This is one of the simplest “be different” marketing strategies. Here’s a great example of how it can work.

The hugging butcher:

17 years ago, Lori Prokop scraped together her savings to attend a seminar hosted by Ted Nicholas, a master of direct marketing and writing genius.

She caught his eye during the break and told him the story.

She and her husband were struggling with their butcher shop, almost to the point of closing the doors because the entire parking lot was torn up and was unusable for six months, totally destroying their flow of customers.

So how could she attract more customers?

Ted started asking questions and discovered that her husband was quite a big man and also liked to hug people.

Ted gave her the one piece of advice that transformed their lives almost immediately.

He said: “When you get home the first thing I want you to do is call your butcher shop The Hugging Butcher – advertise it everywhere, new signs and all over your marketing.

“Use direct-response style marketing and make your husband ‘the kissing butcher’ and ask him to stand at the front door and kiss everyone who walks through – men, women and children.”

She took Ted’s advice to a T. Faster than she could have ever dreamed, business was booming. People couldn’t wait to visit the hugging butcher.

Soon they were able to raise the price and demanded the highest price in the market they served – and customers lined up at the door.

After a few years, they sold this business for a very large amount of money. Amazing what a simple differentiator can do for a business.

Now she runs a multi-million dollar consulting business, teaching techniques similar to those taught by Ted.

All Ted Nicholas asked Lori to do was add a catchy nickname to their business. The catchy nickname was made up of three short words: The Hugging Butcher.

And that’s all it took for the company to become incredibly well-known with a huge increase in sales at the same time.

If your business is seen to be different in a positive way, you can often do remarkably well, says Graham McGregor.

Provided

If your business is seen to be different in a positive way, you can often do remarkably well, says Graham McGregor.

Strategy 2: The unusual guarantee

A simple way to make your business different is to have an unusual warranty.

Here’s a good example: Bug’s Burger Bug Killers, Inc. from Australia has a fantastic guarantee…

“You don’t owe a penny until all the pests on your premises have been eliminated. If ever you are not satisfied with BBBK’s services, you will receive a refund for up to 12 months of the company’s services…

“PLUS the cost of another exterminator of your choice for the next year. AND, if a guest spots a pest on your premises, BBBK will pay for the guest’s meal or room, send an apology AND pay for a future stay. AND if your facility is ever shut down due to cockroaches or rodents, BBBK will pay all fines, plus all lost profits PLUS $5,000.

What difference has this warranty made?

BBBK became a $30 million a year business and captured 80% of its market using this guarantee.

Strategy 3: Added value

Adding value is one of my favorite marketing strategies. Here’s a great example of how it works.

Marketing expert Mal Emery has bought and sold dozens of businesses and helps business owners create massive increases in sales and profits.

When I interviewed him a while ago, Mal explained to me that a great way to increase sales for any business is to use unexpected added value.

He told me how he did this with a cafe he owned many years ago.

When a customer bought a coffee, Mal offered his customers a glass of ice cold soda water at no extra charge.

Now, of course, the reaction from customers was “I didn’t order this, why am I getting this?”

Mal has trained its staff to tell the tale: “The free sparkling water serves to cleanse your palate so that every time you take a sip of your coffee, you can taste that beautiful coffee again and again and again.”

He also put some chocolate on the side of the coffee cup with the coffee’s name, Hasty Tasty, on the chocolate. All this was an unexpected added value.

What was the perceived value of this coffee?

Well, back then it was $1.50 for a coffee and when you added the sparkling water and a chocolate it was worth about $3.50 to the customer. However, it only costs Mal pennies to provide that extra added value.

Now someone paid Mal $1.50 and they got $3.50 worth. So who do you think they told?

They told all their friends

then his sales exploded.

He went from zero sales to $10,000 a week in five months and was able to sell this business for $230,000 by applying the value-added principle.

The good news in marketing is that if your business is seen to be different in a positive way, you can often do remarkably well.

Take action:

How could you make your product, service or business positively different from your competitors?

“In real estate, it’s location, location, location. In business, you have to differentiate, differentiate, differentiate,” said Robert Goizueta, former CEO of Coca Cola.

Graham McGregor is a marketing consultant. You can get his free marketing guide “The Plan B Sales Solution” at www.simplemarketinganswers.com