Fast-growing consumer electronics and appliances retailer hhgregg has faced technology challenges in recent years but not the types you might think. Its main challenge has been not losing sight of what has made it so successful — its secret sauce, if you will — with all of the technology options now available to utilize.
Popular cool-guy mobile apps and do-it-yourself online stores interfere with the company’s traditional “secret sauce,” its highly trained and knowledgeable sales associates who help customers make the right purchase decisions. Instead of shunning technology, hhgregg has embraced its potential antagonist and found new ways to support and enhance its unique selling proposition utilizing technology in the right places.
Companies of every size in every industry face similar situations throughout their development and natural lifecycles. Leaders face tough decisions to follow the market or blaze their own trails, particularly where technology is concerned.
Know your assets. The first step in protecting your secret sauce is knowing what it is. If hhgregg had mistakenly identified having the latest products at low prices as its unique selling proposition, it might have focused on less personal online sales or discount promotions. Those strategies may work for competitors, but not for hhgregg. Does the company have the latest products at low prices? Yes, but that’s not why most people choose to shop there — it’s the advice of sales associates on which appliances or electronics best match what customers need and want that drives people into the stores.
The best, most effective unique selling propositions are short, easily understandable, and relatable to your target customers. If you can’t write the recipe for your company’s secret sauce on the back of your business card or communicate it in about a sentence or less, you may want to consider spending some time defining it yourself or getting some help from a marketing or branding expert.
Know when to say no. Another important part of protecting your secret sauce is knowing when to say no and having the audacity (perhaps temerity) to turn down potentially lucrative new business that would diminish or damage your unique selling proposition.
Indianapolis-based search engine optimization firm Slingshot SEO — TechPoint’s 2011 Information Technology “Company of the Year” Mira Award Winner — knows a thing or two about saying no. The company even incorporated a disclaimer of sorts into messaging about its selling proposition to define and advertise for the kinds of clients with which it wants to work.
“Slingshot SEO helps deserving brands achieve exponential business success through search.” This statement tells you what the company does and singles out that it chooses to work only with deserving brands as it defines them. The company helps clients refine their online presence for maximum search engine friendliness, and leverages proprietary software and processes to increase search visibility.
Slingshot SEO believes it is in the business of helping to connect brands with the customers for whom they are the best fit. It’s not about tricking search engines into making their clients the No. 1 result but providing the best possible response to a user’s keyword query — delivering the response that is most likely to match the user’s objectives.
Know who’s a player. This deserving approach doesn’t work for everyone. There is a certain amount of commitment required in terms of content generation and perspective on the part of the client, a commitment that some aren’t able to make. By being selective, Slingshot SEO is protecting its way of doing business, even though it may sometimes need to decline new business that isn’t a good fit for the way the company approaches the marketplace.
Like hhgregg and Slingshot SEO, many companies face difficult decisions about applying new technologies and taking on new customers. It’s important to stop and think about the possible impact it will have on your company’s unique selling proposition before embarking on significant new ventures.
New technologies and new customers alike are often fun and exciting for your company, but careful evaluation is necessary to ensure that they are a good fit for the way you do business and that they never interfere with your secret sauce.
JAMES L. JAY is president and CEO of TechPoint, Indiana’s technology industry and entrepreneurship growth initiative. He also serves as president and CEO of TechPoint Ventures, which has invested more than $16 million in early-stage capital in 12 Indiana-based technology companies through HALO Capital Group since 2009. An Indianapolis native, he has a successful track record as an entrepreneur, business leader and public servant.
Coca-Cola invented the coupon for a national advertising campaign in 1895. Tickets to try a free Coca-Cola were mailed out and included with magazines. By 1913, the company had redeemed 8.5 million “free drink” coupons, and Coca-Cola was on its way to becoming one of the world’s most recognized brands.
Today, more than 100 years later, the coupon is still going strong ? some 323 billion are used in the United States each year. The 21st Century coupon functions much like the original, feeding deals and discounts to consumers through websites, social media and e-mails.
Extreme fragmentation and opt-in only regulations that rule digital interaction with consumers make it nearly impossible for any one company to replicate what Coca-Cola did in today’s marketplace. Fortunately for modern marketers, there are much more efficient and cost-effective ways to reach consumers other than throwing endless coupons at them and hoping that loyalty follows the savings.
The main difference between macro-marketing tactics such as inserting coupons into magazines and the emerging one-size-fits-one marketing approach of today is data. Collecting, managing and analyzing customers’ personal and transactional data makes it possible to deliver the right message to the right person at the right time.
A high-end beauty salon and spa business, for example, that books appointments with clients several weeks to months in advance could utilize that planned activity data to promote additional spa services and products via e-mail. Clients who have hair appointments would receive offers for massage and skin treatment services and vice versa.
The point of the program would be to offer discounts or package deals to clients as an incentive for trying new services. Traditional coupons available to the public would likely be redeemed by clients to receive discounts on the services they already use, which would diminish the spa’s profit margin. The one-to-one measured marketing tactic would preserve the original profit margin, introduce clients to more services and increase long-term profit potential.
Collecting and segmenting data so that it can be used to target specific customers with offers tailored to their needs is crucial for one-to-one measured marketing success. Most e-mail marketing services provide segmentation solutions, and I touched on several data collection and management service firms in my last column (see “Technology is the great equalizer in relationship management,” June 2011).
One-to-one measured marketing is more difficult to execute than other forms of marketing, but it’s exponentially more effective. The multiple steps and data analysis required for the one-to-one approach certainly take more time and effort than developing a coupon that is blasted out to a singular list of prospects. But the one-to-one approach goes beyond personalization ? inserting names and purchased products into e-mails ? and represents the concept of doing business on customer terms instead of however the business started or did things in the past.
To illustrate the virtue of customer-centric marketing, think about the last time you unsubscribed to a newsletter or advertisement that came to your e-mail inbox. Chances are good that you chose to unsubscribe because the content just wasn’t relevant enough to you to want to keep receiving the e-mails.
Now, think about the e-mails and offers you are sending to your own customers. Would they pass the same relevancy test that you employed before you unsubscribed? If not, then you may want to consider auditing your marketing programs and looking for ways to shift your process to a one-size-fits-one approach. It’s not something that happens overnight. You may find success by starting with group segments and adopting a one-size-fits-some approach until you have the data necessary for more individual messaging and consumer conversations.
There are also great opportunities to partner with digital marketing services such as Groupon, Social Living, Tippr and other social media-based deal-finders that already have extensive demographic data collected and segmented in markets across the United States.
Once you have your own opt-in lists segmented in ways that make one-to-one measured marketing possible, you’ll be able to engage customer in ways that capture how customers perceive you and how you are meeting their needs, which can help you retain their business and convert them into advocates of your brand.
BIO on file
James L. Jay is president and CEO of TechPoint, Indiana’s technology industry and entrepreneurship growth initiative. He also serves as president and CEO of TechPoint Ventures, which has invested more than $16 million in early-stage capital in 12 Indiana-based technology companies through HALO Capital Group since 2009. An Indianapolis native, he has a successful track record as an entrepreneur, business leader and public servant.