Power Direct Marketing: The Book
The Offer Chart
The Offer Chart below grids your company and your product together. Unique and Commodity refer to your product or service. Known and Unknown refer to your company or organization.
Unique is just that: different/unusual/new/a large step forward. Many new product introductions in telecommunications and computers begin as "unique."
Worldwide, every day, an average of 36 new consumer products are introduced. (Please note, I said consumerthis doesnt even include business products!) And over 13,000 each year. Even if what you have to offer is "new," you still have lots of competition.
A commodity item is something that is available through many sources, is possibly a mature product in a mature marketplace. It is "regular" and taken for granted. Anything that can be classified as "supplies" fits this classification. Such as office supplies, computer supplies, medical supplies.
Your company can become a known company when it is a big player in its field. Maybe a large fish in a small pondyou dont have to be internationally recognized to become known. Maybe you are known only in a geographic region.
Unknown means you are not yet well-known. You may be a start-up, maybe youre #5 or #8 or #12 on a list of companies in this same field. It doesnt mean you dont have a thing to offer. It does mean you are a lesser player in this product/service category.
If you are known and your product is unique, you have a "sweetheart" situation. Your offer may be only that you again are leading the field. You are first. You offer more than any of the competition. Sometimes this will workIF you are both known and your product is unique.
If you are unknowneven with a unique productyou must have a sound, clear offer. An offer that needs to take into consideration the timing of the introduction, packaging of the product, its price and possibly first-time specials.
If your product is a regular item or service, and you are unknown, you may still find it profitable to be in that business. Provided you have offers that reflect what is happening in the marketplace, your launch is timed right, it is bundled or packaged accordingly, it is priced correctly, and it offers a special inducement to the end user. Over and above the product benefits.
If you offer a regular item, you might consider how to position your product according to the thinking of Neil Cannon, Chairman and CEO of Schmidt-Cannon. he suggests four ideas for selling such products:
Convenience: Youre easy to talk to. Youre available.
Experience: Youve been around the track a few times. You know what youre talking about.
Reliability: You do what you say youre going to do. You fulfil your promises.
Exclusivity: How can you offer an "exclusive" commodity? Many products are those we use every day. And dont think a thing about. YOU take the common, everyday item and turn it into something "special."
You make a commodity unique by adding something to ityou make it different, you offer something over and above what your competition is doing. You make it exclusive.
An unknown company does not want to begin business selling a commodity. The only exception I think of to this "rule" is if you can isolate a truly "niche" marketplace and service it with products/services unique and special to that market. In that case offering commodity items could work well.
Lets go back to the early 1980s and the personal computer business. In which quadrant on the Offer Chart were PCs in 19808182? Well, for IBM they were in the Known/Unique square. IBM is well-known in computers, and when they came out with their PC, it was still a unique offering.
Where are personal computers today? Very definitely, they are commodities.
Packaging and the Offer
Briefly lets consider packaging and the offer. Here are some examples of products that enjoyed increased sales when packaging was changed to serve the marketplace:
V-8 juice in cartons, similar to milk cartons, gained access to the refrigerator section of supermarkets.
Result: 15% jump in sales.
Noxzema skin lotion is now available in a pump container to serve women with long fingernails who dont like jars.
Nestle changed their packaging of candies from boxes to bags so the stores would move them lower on the shelves where people can see them.
United Ad Label offered alternate packaging of their "stock" labels sold to hospitals, from a minimum of 1000 per roll to 500.
Results: they recaptured much of the smaller hospital marketplace.
As James Moran of Campbell Soup says: "Packaging has become almost as important as the product itself."
The folks at Avon agree. Skin-So-Soft is the largest-selling skin cream in the world. A few years ago a "different" application for it surfaced: Skin-So-Soft does a fantastic job as a mosquito repellent. Avon repackaged the product for this new use in a spray bottle. As a direct result, their sales increased annually by more than two million units.
You need to look at the Offer Chart, decide where you fit and what you need for your offer BEFORE you determine what your offer should be.
by ROCKINGHAM*JUTKINS*marketing, all rights reserved.