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11 Ways To Stand Out And Radically Increase Profit Margins Even In A Crowded Market

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11 Ways To Stand Out And Radically Increase Profit Margins Even In A Crowded Market
McDonald’s, Burger King, Wendy’s…kind of all the same thing, aren’t they? As far as quality goes I would have to rule with either Burger King or Wendy’s over McDonald’s any day of the week.
But who has more business? McDonald’s does. They were around first. And now, even though they’re not the best (in my opinion at least), they’re still the richest.

Unfortunately for Burger King and Wendy’s, they are not going to get ahead by doing the same old thing, but just being a little bit better at it. In a world with massive competition, businesses need to stand out from the crowd.

They need to un-commoditize. That’s what Burger King and Wendy’s are missing. Next to McDonald’s they’re just commodities, even if they are a little better. So if you can’t be McDonald’s, be Taco Bell or Starbucks instead. Don’t be Wendy’s or Burger King.

The beauty about un-commoditizing your business is that it puts you in a category of your own. When you are in your own category, there’s nothing to compare you with. When there’s nothing to compare you with, then there’s no set expectations for how much you should cost.

When that happens, guess who gets to set the expectations? You do, which means you can set your prices drastically higher and radically increase your profit margins. If you can effectively bring in and keep customers without having to compete on price, then you’re probably going to be rich. Does that sound okay with you?

To help you do that, I’ve included a list of 11 strategies that you can use to un-commoditize your business.

 

1. Go with a different look

Marketing expert, Perry Belcher tells of a company he worked with that imported heat sealers from China. “Everybody in the world brings in these little heat sealers from one company in China. They’re an aqua blue color and… just scream, I’m a Chinese heat sealer!

Belcher was able to command a higher price for the exact same heat sealer simply by making it look different. He had the heat sealers painted red instead of blue (which probably didn’t cost him any extra) and sold them through a company with an American sounding name.

Apple does something similar with their shiny white computers that sell for three times the price of a PC. Going with a different look is probably not the only way that you’ll want to stand out, but it might be a great way to start.

 “Be the one to stand out in the crowd.” – Joel Osteen

2. Be aggressively devoted to premium quality

Speaking of Apple, how many times have you heard that one of their products just bombed? Answer: Not recently. In fact, it was reported that preorders for their watch sold out in a matter of hours. Compare that with their main competitor, Microsoft, who has had significant problems with two out of the last four Windows updates.

No wonder Apple products cost so much more. And it’s not just Apple. Think of names like:

  • Rolls-Royce
  • Gucci
  • The Four Seasons
  • Disney
  • Tiffany’s

These are companies that do not compete on price. They get rich competing on quality.

 

3. Bundle physical products with your information products

Thanks to the Internet, selling information products is easier than ever. As a result, everybody is selling information products. After all, why not? The profit margin can be up to nearly 100%. The downside of this is that it becomes very hard to stand out.

With all this competition we’re seeing much lower prices for certain information products than you would have seen only a few years ago. But, if you’re interested in getting rich, then competing on price is a bad idea. Instead, find a way to stand out and charge even higher prices.

A great way to do this is to bundle information products with physical products. For example: A company that sells a course on how to be a better skier could bundle the course with a set of skis and charge a much higher price.

 

4. Bundle information with your physical goods

This is the reverse of what I was just talking about. The Internet has created massive competition for sellers of information and physical goods alike. By bundling information products with your physical goods you can drastically increase profit margins.

Using the same type of example as before: Instead of just selling a set of skis, you could sell them along with a course on how to be an expert skier. By using this strategy you can raise the price significantly, without increasing costs very much.

Luckily, information products are not too hard to come by. You can partner with someone who sells information products. You can offer to publish an information product that someone has created or wants to create. Or, if you have the expertise, the time and the interest, you can create your own information products.  (Note: Just make sure that the information products you use are always top notch.)

 

5. Create a subcategory

Charles Lindbergh was the first person to fly the Atlantic solo. That’s fairly common knowledge. Do you happen to know who the second person was? Nobody knows, even though Bert Hinkler actually did a better job. He made the trip in less time and with less fuel.

But, in business poor Bert would have been nothing more than a me-too product that people ignore. The dominating spot in his market had already been taken, and sometimes people just don’t care if you can do the job better. There’s already a name that they trust.

If you’re new to a market that already has a leader, then you need to create your own subcategory that nobody has claimed yet. You’ve possibly heard of the third person who flew the Atlantic solo. Her name was Amelia Earhart. But no one remembers her as the third person to get the job done. She was the first woman to get the job done. She had her own subcategory.

Want an example? Between Apple and Microsoft the personal computer market is pretty competitive. But what if a company came along and created its own computers with an operating system that is designed specifically and exclusively for gamers?

Between Microsoft having had way too many problems in the last few years and Apple not really focusing on the videogame market, a company who did a great job creating and marketing a computer exclusively for gamers might be very successful.

“Today we’re living in an anti-Waldo world, where you don’t want to blend in and have people struggle to find you. You want your personal brand to stand out like you’re wearing a red and white sweater, and everyone else has on black.”  – Jarod Kintz

6. Create a better guarantee

With so many swindlers out there your customers obviously need to know that they’re not stepping into a trap they can’t get out of. Hopefully that’s not news to you. Unfortunately, in many markets having a 60 day 100% money back guarantee is more of a given than a bonus these days.

Just about everyone has some type of guarantee. If you want to stand out, why not try offering something much better than everyone else. For example you could try offering to refund 110% of your price to any unsatisfied customer. Obviously your risk is slightly higher with such a guarantee.

But your likelihood of losing money instead of gaining much more money with this kind of guarantee is extremely low, assuming you’re offering a quality product or service. What type of superior guarantee could you offer in your business?

 

7. Be a contrarian brand

Whether it be corporate giants, big government, the media or even some charity organizations, people just don’t trust the mainstream establishment anymore. There’s been one too many stories about corporate deception, political bribes and media coverups.

Sometimes to be successful, you can’t just be a little different than everyone else. You have to be the opposite. In The 22 Immutable Laws Of Marketing Al Ries and Jack Trout write:

A good No. 2 [brand] can’t afford to be timid. Burger King’s most successful years came when it was on the attack. It opened with “Have it your way,” which twitted McDonald’s mass-manufacturing approach to hamburgers. Then for some unknown reason Burger King got timid and stopped attacking McDonald’s. It even started a program to attract little kids, the mainstay of McDonald’s strength. Burger King’s sales per unit declined and have never returned to the level they were when it was on the attack.”

How could you attack the status quo and make your business an opposite brand? Remember: What you’re offering doesn’t have to be the exact opposite or even necessarily very different. What has to be opposite is your message and how you position yourself.(Note: After all, Burger King was never really that different from McDonald’s.)

Stand Out

8. Create an outstanding acquisition offer

Thanks to the Internet creating a global marketplace, small businesses can reach more customers than ever before. But the Internet is a mixed blessing. Yes, you can reach a vastly increased pool of potential customers. But, you are also placed next to a vastly increased number of competitors.

Add this to the fact that today’s buyers are more skeptical than ever, and you may have a real problem on your hands. The good news is that all your competitors face that same dilemma, which gives you a chance to get ahead of them… if you use smart strategies.

Today’s buyers are so skeptical, they tend to stick with brands that they know and trust. But, how are they ever going to trust you if they never give you a chance? The trick is getting that first sale which allows you to knock their socks off and prove that your brand is the one that deserves their business.

A great way to do this is with an acquisition offer. An acquisition offer is a high-value, low priced offer that allows you to acquire a new customer and prove to them the quality of your brand. If you can prove to them that your brand offers great quality and service, then they’ll probably keep on buying from you in the future.

Cable/Internet companies have a tendency to do this by offering a deeply discounted rate for a limited time. During that discounted phase they’re hoping to prove how great their service is, so that you’ll stay with them long-term.

An example of a similar strategy is McDonald’s dollar menu. Maybe you go there just to buy that one dollar burger. But what do they do once you’re there? They ask “Would you like fries and coke with that?” I guarantee you, they’re not getting rich off the sale of one dollar burgers. They’re getting rich off the sale of side dishes and soft drinks.

 

9. Focus on a benefit your competitors don’t talk about

Sometimes what you sell doesn’t actually have to be different. Sometimes what is different is what you say and who you say it to. Let’s say there are five different companies that buy the same type of soap from the same manufacturer.

One company emphasizes how good their soap is for dry skin. One company emphasizes the powerful germ killing effect of their soap. Another company tells people that they offer THE soap to use if you want to smell and feel like an attractive lady. One company emphasizes how refreshed and clean their customers will feel after they get out of a shower with this soap. The last company emphasizes how effective their soap is at eliminating body odor.

Now, these companies might have asked for a bit of customization. Maybe they each have their logos on the bars of soap. Maybe one company asked for their soap to be colored blue while another asked for pink, but they are all selling the same exact soap!

None of them are lying. All the soap being sold by these companies is good for dry skin, eliminating B.O., killing germs and so on. Yet these five companies are able to sell the exact same product to different target markets simply by emphasizing different benefits.

The beauty is that all five might end up being very successful even if they charge high prices, because they’re just selling next to each other. They’re not competing with each other.

 

10. Describe your process and why it’s good (even if it’s not unique)

Let’s take that last soap example a little bit further. Let’s say that there is a sixth company that starts buying some of the same soap from the soap manufacturer. They’re just passionate about the germ killing effects of this soap and they don’t want to come up with a different angle to use to sell to a different target market.

Their problem is that there is already another company, with an established brand, selling that same product to that same market. The new company will want to find a way to differentiate itself. This can actually be as simple as telling their customers why their product works so well.

Instead of just saying: “Our soap is THE soap to use to kill germs.” They can say: “Our soap is THE soap to use to kill germs because we include powerful, state-of-the-art antibiotics in our formula. The germs won’t stand a chance.”

By saying this, they are able to differentiate themselves and sell the exact same product to the exact same market for the exact same reason. If they sell their product using this message they may be able to get a serious advantage over the company that was already selling to the germ killing market.

Because they sell it as a product using state-of-the-art science, they could likely charge an even higher price than the already established company. It doesn’t matter that the first company has those antibiotics too, because the customer doesn’t know that.

And the first company can’t suddenly start talking about the powerful antibiotics in their formula, because they will then look like the me-too company. They’ll have to come up with a new reason why they are still the best germ killing soap company.

 

11. Offer out of this world customer service

Am I the only one who hates having to call help or customer support at companies? First you have to wait forever to actually talk to a person. You never know if they’re actually going to know what they’re doing and be helpful or if they will be ignorant, stubborn or rude.

So why not be the company that blows their customers away with how good they are treated? Try these:

  • Try guaranteeing to answer the phone by the third ring.
  • Try offering to have someone come out to your customer’s home or office to help them assemble your product and/or teach them how to use it.
  • Follow up after a purchase with a friendly phone call and make sure everything is alright. Ask if they have any questions or anything else you can help them with.
  • Be relentlessly helpful, friendly and generous every step of the way.

 

Conclusion

Un-commoditizing your business is not only possible. It’s essential if you want to compete and win in a competitive global marketplace.

Once you un-commoditize your business, you’ll have the power to drastically raise prices and increase profit margins without getting compared to cheaper alternatives. If you truly and successfully un-commoditize your business then there are no alternatives.

These 11 strategies can help you stand out in business. So, which un-commoditizing strategy are you going to try first?
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4 Comments

4 Comments

  1. Alice Dartnell

    Jul 28, 2015 at 7:11 am

    Fab article! Some really useful, but most importantly applicable, ideas.

  2. web development minneapolis

    Jun 14, 2015 at 3:48 am

    This website definitely has all of the info
    I wanted concerning this subject and didn’t know who to ask.

    • Seth

      Jun 19, 2015 at 2:15 pm

      Glad you found this helpful!

  3. Stefanie

    Jun 11, 2015 at 8:11 am

    Hey Seth,
    thank you for this awesome article, offering a lot of high quality content!
    I find it kind of difficult to pick up that one strategy to start with first, since I think it’s important to have them all working together. However, as I am in the information business, strategy no. 3, Bundle physical products with your information products, is the strategy that made me think first. I noticed that at least here in Germany, people often give a higher value to physical than to a digital product. A combination would definitely increase the perceived value.
    Cheers
    Stefanie

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Startups

The Problem Is Not Your Website Or Your Product.

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spend a lot of my time talking to business owners. They focus on their product, their marketing channels and trying to make more profit.

I met one such business owner who was in the plastic surgery business. Their product (boob jobs and nose jobs) was not working. Their website sucked and people clicked off as soon as they visited it.

People would call their office, get put on hold, listen to the on hold message and hang up.

This business didn’t seem all that special. I’ve talked to many businesses and didn’t think for a microsecond that a plastic surgery clinic could ever teach me anything valuable.

I’ve been to Hollywood on holidays and the issues of body image are all too apparent to me. Anyway, this post is not about body image.

I ended up losing this business as a customer — not that I would ever have sold anything to them if it were up to me. I sat down one afternoon and thought about why we no longer did business with them.

That’s when I realized it’s not about your product or your website. All the issues with this plastic surgery clinic and a lot of other businesses I’ve dealt with stem from one thing. Let me explain in more detail.


Your Google Reviews say you’re an piece of work.

I looked up their Google Reviews and their customers said they were assholes.

They spoke down to clients, they didn’t deliver their clients what they wanted, they argued with their staff in front of customers and they treated people like they were nothing more than a dollar sign.

All I had to do was read their Google reviews to see that the problem wasn’t their product or their website.


Your clients tell you every day that you suck.

I asked the plastic surgery what their clients said.

Many of their clients told them that their services sucked and they would prefer to go to places like Thailand where they could get a better product at a much lower price.

The business owner made the mistake of thinking it was their product that was the problem and that a new website will tell clients a different message.

That wasn’t it.


You abuse your staff and they consistently leave.

I spoke with many staff that worked for this business.

Every single one of them hated the company and were not afraid to say what they thought of the business owner.

The business owner would sit outside on a nice sunny day and look across the street at all the yachts and the people boarding them.

They’d sit there and think that every lead they got was going to take them one step closer to owning their very own yacht.

“If only I could deliver more boob jobs, maybe I could have one of those,” they thought quietly to themselves hoping that no one else could hear how ridiculous this sounded.

I can remember multiple times being on the phone to the business owner and having one of their staff burst into tears halfway through the call.

The first time it happened I didn’t think much. After the third time, I got the message. During the short time I dealt with this business, people consistently left. If you made it to the six-month mark, you were some sort of hero and would probably be given a free surgery to say thank you for your work and make you feel worse about your own body at the same time.

It was free noses and boobs in return for daily abuse.

The problem still wasn’t the website all the product.


You don’t solve real problems; you solve your own problem.

A good business solves a problem.

That problem typically affects human beings and solving it is how you make money in business. Solving problems can start out with a problem that affects you, but at some point, you’ve got to start solving that same problem for other people/businesses.

This owner of this plastic surgery clinic was only trying to solve their own problem which was making more money to buy fancy items like yachts.

Only solving your own problem is not just selfish but bad business.

Good business is solving a big problem or lots of small problems for entire strangers who you don’t know thus doing something valuable for the human race.

Solving only your problem will make you poor.

The problem still wasn’t their website or product.


Creating more problems.

Everything this business owner sold created more problems.

They’d film videos to purposely make people feel like their body wasn’t perfect.

They’d write articles suggesting that everyone needs botox to feel young.

They’d take photos of men and women who were supposed to be perfect so that young people would dream of looking like them.

Not only was their business not solving a real problem; it was also creating more problems every day that it existed.

If your business creates more problems than it solves, you’re in real trouble.You need to take a long hard look at the business and become obsessed with doing everything you can to change it — and do so damn fast to limit the whirlwind of problems you’re creating behind you.


The heart of the problem.

It’s the business owner.

The business I mentioned will fail. That part is certain. The problem with the business is not the website or the product.

The problem is the business has no heart because the business owner has no heart.

You cannot focus on your own selfish desires, create really bad problems in the world, treat other human beings like garbage and expect to go buy a yacht and live happily ever after. It just doesn’t happen like that.

Whether you are a plastic surgery clinic like the one I described or a solo entrepreneur, the problem with your business is you.

Fix the problem of YOU. You can’t get away with being horrible forever.
Being horrible is bad business.

Being respectful, kind and valuable is the final answer to the problem with your business.

<<<>>>

If you want to increase your productivity and learn some more valuable life hacks, then join my private mailing list on timdenning.net

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Entrepreneurs

18 Must Read Business Books for Emerging Entrepreneurs and Startups

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business books

Reading is both relaxation and training for the mind. Who reads, dives into another world. Learning, entertaining and breaking out of everyday life for a short moment. One could go even so far as to say reading is the second most beautiful thing in the world! Whether it is non-fiction or a novel of all the world’s man has created, the book is the most powerful tool. That is also, why we wanted to find out which business book you should undertake in the new year. (more…)

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Startups

Everyone Wants Sales Leads But No One Wants To Sell

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Sales leads are the lifeblood of any business.

Without leads, your business doesn’t make money. That’s why many businesses treat leads like the most valuable resource in existence. Leads are a topic that never goes away and you can never have enough.

Sales leads are the cause of so many disputes in business.

We have it all wrong, though.

Having something to sell is the real answer.


Knowing what you’re selling.

Many companies don’t know what they are selling.

They think they’re selling products or services that magically turn into revenue and light up your accounting software with lots of green, shiny graphs.

Until you know what you’re selling, sales leads won’t help. Getting more sales leads, increasing your Adwords spend, buying more Facebook ads, doing more networking events, printing more t-shirts and producing more ‘content’ for your blog will not help.

You’re not getting enough leads or closing the leads you have because you’re not sure what you’re selling.


Are you selling to humans?

Go and Google ten company websites. Pick any ten.

You’ll notice one thing: more than half the websites don’t sound like they are selling to humans.

There’s no human language, very little content created by the people that work at the company, zero compassion and not a lot of humility.

Most websites are designed to sell to robots that can’t stop looking at their smartphone. That’s not us. We’re human despite our phones changing the way we live.

Humans look for thoughtful businesses.
Humans look for solutions to problems that are not being solved.
Humans like a business to stand for something human.


How you sell matters.

Selling like you’re in the office with The Wolf Of Wall Street Jordan Belfort will not help you sell.

How you sell matters just as much as what you sell.

The process you put a client through has to be simple, thoughtful and in their best interests (not yours).

That last point is crucial. Many businesses exist to serve the board or shareholders, but they do very little to help people like you and I live a better life and do our best work.

The values of your company and what you stand for effect the leads. Before anyone ever becomes a lead in your sales funnel they are a person or a group of persons (a business) with a problem.

Many people never make it into your sales funnel because how you sell what you do is wrong.

Paying for more leads is not nearly as powerful as changing how you sell to the leads you have.


Loving the people who do the selling.

Leads are only half the puzzle.

The bigger question is who is selling to the leads? Does your business treat those people who call your leads well? Do the people who call your leads even care or are they after nothing more than a pay cheque?

These are the unanswered questions that get lost in conversations about why your business needs more leads.

More leads won’t help if your salespeople burn them or don’t know how to convert each lead into a customer that becomes a raving fan and introduces more people (leads) for free.


Treat one lead really well.

I had a sales guy that used to work for me. He treated one lead in Queensland, Australia really well. He spoke to him every day. He knew a lot about the persons family. He even went to the leads barbecue.

That lead was so impressed that he referred several hundred (that we could track) leads to our business. Treating one lead really well is far more powerful than buying more leads who don’t care about what you do.

Digital marketing has become a drug that every business thinks they need.

If only the business world knew the power of one lead.


The good cause factor.

Your business may do something simple like mow lawns.

That may not sound like a life-changing business that can take this lead advice I’m giving onboard. “My business is simple,” you say to me.

Well, I’d challenge that. Any business can have what I call the ‘Good Cause Factor.”

Let be give you an example. The local butcher down the road from me has a BBQ every Saturday afternoon where they invite the community to come and eat some food for free. Everyone is welcome including the few homeless people in the area that never buy any meat from their business.

People stand out the front of that butcher and talk about things that are happening in the community. This Saturday ritual has become a place where business ideas have flourished, homeless issues have been discussed and people who were lonely and possibly suicidal, decided to live for a bit longer.

The last part is the most interesting. In my community here in suburban Melbourne, there is a large group of people that suffer from mental illness. When I went through my own battle with mental illness, I went to the local town hall where people gathered who suffered from the same condition.

It was that event every Wednesday that helped me become a different person.The loneliness and the isolation I felt were cured by the simple act of connecting with other people and having the guts to talk about the demons I was facing.

These same people go to our local butcher on Saturday and eat at the free BBQ. The butcher is thoughtful and they know that they are doing something far more important than selling meat; they’re selling connection to the community, and a possible solution for isolation and loneliness that leads to mental illness.

So back to the point of this post, the community butcher is selling a good cause — an X Factor as some people would call it.

What your business does with its resources to help a worthy cause that affects humans like you and I is just as important as sales funnels, lead generation and your product roadmap.

Link your business to a worthy cause no matter how simple it is.


Lead quality.

I lose my mind when people talk about lead quality.

The quality of leads comes down to the quality of people talking to those leads and what you have to offerEven the coldest lead can buy from you if you know how to find their problem — which they may not know they have — and use your product or service to enhance their life.

Quality of leads is a myth. All leads are equal.

No matter what stage of the sales funnel someone is in, they can be converted by the right business, with the right message and the right intentions to serve rather than take.


More leads are not the answer.

I know you want more leads. We all do.

I’m telling you to think much wider and deeper than that. If all we had to do was get more leads and we’d become the next Bill Gates, we’d be all billionaires.

I could go and set up a business that does nothing more than generate leads and call my business the ‘Billionaire Factory.’ One, two, lead, wham, bam and now you’re rich.

Refine your business down to helping one lead.
Make that lead believe in you.

Rinse, repeat.

<<<>>>

If you want to increase your productivity and learn some more valuable life hacks, then join my private mailing list on timdenning.net

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Startups

5 Digital Marketing Habits Geared for Success in 2019

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digital marketing

The digital marketing landscape is in constant flux. New social platforms are born daily, while others fizzle out, and search engine algorithms are updated hundreds of times a year. What worked last year may not work this year. The reasons you need a digital marketing strategy remain similar each year, but to be successful in 2019, you should practice the 5 digital marketing habits below. (more…)

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