New Zealand Business Tradie 22 July 2021 Mistake #3 Failing to Distinguish and Differentiate Almost every business will be tempted at some point to beat their competition at their own game. They try to be everything to everybody, and end up being nothing to nobody. So what’s the remedy? Law #2 A brand becomes stronger when you narrow its focus The above problems are real. Almost every business will be tempted by them at some point. But the key to growing a strong brand is to have a very clear and distinctive focus. Don’t try and beat your competitor at his game, make your own game! The above law comes from The 22 Immutable Laws of Branding by Al Ries and Laura Ries. The basis of the law is that you don’t want to compete within a category, you want to dominate a category. So If you can’t be the leader in your category, make your own category. For example, Subway don’t sell burgers, pies, pizzas or donuts. They sell submarine sandwiches. They don’t compete with McDonalds, Burger King, Wendy’s, Starbucks, KFC, Dominoes, Pizza Hutt, or Dunk’n Donuts. They don’t compete in those categories. They compete in their own category and they’re number one! So, what is branding? This is the key question. Your brand is not your name or your logo, although they are included. Your brand is not your product or service although that is essential. Your brand is simply what consumers think of you. Its their perception based on their experience with your company and your products. Its everything they have every seen, heard, smelled, or experienced about your company. “Your brand is the single idea or concept that you own inside the mind of your customer.” Al Ries Perception. That’s all. So branding is all of the things you do as a company to create and manage that perception. “What you think your brand is doesn’t really matter. It’s only what your customer thinks your brand is that matters.” Al Ries If marketing is promoting a perception or desire for your products and services, branding does the same for your company. And usually, the more you try to expand your business, the more you dilute the power of your brand. Yes, expansion can work and it does – but there are laws for that too. The idea is that you want to position your company or your product in the consumers heart and soul as distinctive, desirable, essential. What does this look like in the real world? Some companies believe that to be the best they need to be the best at everything. Wrong. Usually, if you diversify too much you spread your brand awareness too thin. Instead of having massive brand awareness for one thing, you end up with mediocre awareness in several things. Lets look at businesses that are involved with vehicles. You could choose to be involved in trucks, trains, buses, cars, or motorcycles. Or you might refer boats or ships, airplanes, helicopters or even spacecraft. If you decided to start a business based on trucks you could be tempted to sell trucks, and service them, and paint them. You might choose livestock trucks, freight trucks, concrete trucks, small trucks, large trucks, dump trucks, transporter trucks, crane trucks, logging trucks, fire trucks, refrigerated trucks, tow trucks, tankers… you get the idea. If you tried to source, sell, service, support, repair, paint, check for compliance, and demolish all of the above trucks you likely wouldn’t be amazing at all of those things equally. Its highly likely that you would find over time that you have greater interest or even passion in one or two of those things, more than the rest. So you might decide to get involved in livestock or logging. You might decide you prefer servicing to selling. The key is, to narrow your focus. Create a brand, a reputation, a perception in people’s minds, that your company means one thing and that you are the best in the business at that one thing. Take TRT in Hamilton, NZ. Yes, TRT manufacture trailers, and they sell cranes. But when it comes to trucks, TRT are very single-minded. They don’t sell trucks. They don’t paint trucks. TRT want to be known as the number one truck service and repair business for trucks and trailers in New Zealand. They are so single-minded about this that the reason they have a branch in Auckland is so that they can service trucks in Auckland and Northland – their headquarters in Waikato is too far away for such a large volume of business up north. The reason they expanded down south is so they could sell truck parts in Christchurch, and service and repair trucks throughout the South Island. They won’t sell you a truck. They won’t pull the dents out of it for you. They don’t do demolition. They won’t give you a custom paint job and enough chrome for Africa. They will service and repair your truck. End of story. “Limitation combined with consistency (over decades, not years) is what builds a brand.” Al Ries This narrow focus gives them immense power to become known as the best in their business. They are not competing with the sales companies. They don’t worry about what who has the most transporters in the country. They aren’t jealous when Kenworth outsell Mack, or Volvo beat Mitsubishi. But they will fix them all, no worries mate! So What? If you find there is too much competition in your industry, carve out a segment where you become the specialist, not the generalist. Some electrical companies do this. Suppose there are so many electricians in town that competition becomes about who has the lowest prices. No one wins that game. No one enjoys it either. And arguably, even consumers are not winning because they are not going to get the best from an electrician who is forced to drive down his costs – that means cheap staff and rubbish products. So what can you do? You already know what some have done. Instead of doing all electrical work, some companies have specialised in residential, commercial or industrial. Less competition, more specialisation. Some get out of that race and focus on heat pumps. Others get into solar energy? What category could you move into? Application Some things to think about? What is the single idea or concept that you own inside the mind of your customer? Is there one? What do you customers think of your brand? Do you know? Like, really know? What would your customers say your focus is? How have you made your business distinctive – different from the rest? What are you know for and could be the best at? Would you say your business has a broad or a narrow focus? Is there a part of the business that you prefer and wish you could spend more time on? Are you thinking of expanding or contracting? Is there room for a new segment or category in the market? What part of your business lives within the intersection of your expertise, passion and consumer demand? Have a think about it. Less is more.