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Subject: The Curse Of Knowledge --.Never Assume People Know Things

Author: Dennis S. Vogel

[ Next Thread | Previous Thread | Next Message | Previous Message ] Date Posted: 18:31:29 09/17/07 Mon In reply to: Netflix Competitor 's message, "Re: Be Sure Your Differentiator Makes The Right Difference" on 16:00:05 09/17/07 Mon Sorry, I blew it. I made both of us victims of the Curse Of Knowledge. I know what I mean & I assumed the connotations were well known. I looked in a thesaurus & dictionaries for synonyms. I didn’t even find the definitions Jay Abraham & I use for proprietary & commodity. I’ll add some more advice to—hopefully—make up for my slip. I use proprietary in a way that ties in with Unique Selling Proposition/Unique Strategic Position. It relates to patents, copyrights & trade secrets, but doesn’t necessarily mean something protected by law. When you have a proprietary product/service, it’s different than what competitors offer. The difference is valuable to some consumers who appreciate its unique benefit(s) & are willing & able to pay for it. It’s easier to profitably sell a proprietary because there’s more demand. A commodity is something people can easily find. If they miss a chance to buy a commodity, it’s not a problem because they’ll have many more chances later because commodities are common. Proprietary & proprietor are similar. My analogy is: A proprietor owns something valuable. A proprietary is valuable & people want to own it. I usually use commodity in pejorative way, in contrast to the usual denotation. It could be considered to be like a common ditty, compared to a well-orchestrated symphony. Now I’ll segue to the bonus (make-up for my screw-up) advice & keeping the musical theme. Musical Shares Too often, competitors have price wars & play musical shares. Customers just buy from the lowest price provider & it changes so often, they don’t establish a meaningful pattern. Market shares don’t really change, people just buy from whomever has the lowest prices. If the price war (music) stops before each competitor is bankrupt, people may stay with the last one to have the low prices. But don’t bet the farm on it (which is what competitors may be doing). In some cases, raising prices can signal higher quality, but unless you make your service a more valuable proprietary, you could have more trouble. Your service is how you provide entertainment &, in other posts, I outlined possible ways for you to escape the fate of commodities. Your products are commodities & I don’t think you can make them proprietary. 1st: Since you may’ve lost some of your customer base & may lose more, think of ways to help other businesses serve customers you still have. When they sell things through their offers (distributed by you), you can get up to 25% of the revenue from those sales. OR you can trade your influence for their influence & get them to distribute your offers. But since your competitors are growing in number & strength, your offers would have to be mega-compelling (proprietary offers) &/or generous (lower prices, not very profitable for you) to get anybody to consider buying. This can be bad news, here’s more: Every business competes for money people use to buy from other businesses. Your competitors are also satellite TV dish companies, cable TV companies & just about everybody else who offers entertainment. But it goes deeper, when I pay for gasoline; I have less money for video rentals. It’s also harder to justify driving to get them. This is a bigger reason to team up with others so while people are away from home anyway, a trip to your store is just a short detour. In The Zone Apparently, you & your team of business owners saturated your common customer base. Maybe you’re in a small community & had the same customer base before you started working together. If each of you had customer databases before you teamed up & compared them, there were probably few who weren’t in more than 1 database already. It’s not all bad. It shows you’ve chosen the right businesses to work with. Plus, bringing in new customers is more expensive than bringing customers back. If you’ve completely saturated your common customer base, you still know—very accurately—whom your businesses appeal to. Now can you expand your trade zones? Video rental stores may have a small trade zone. Trade Zone = an area you can profitably draw customers from. If you track who customers are & where they come from, you can establish a basic radius. Hypothetically- 75%, of your customers, lives or works about 4 miles away. You can use a compass & put its point where your store is on a map, then put its pencil 4 miles away (according to the map’s scale), then draw a circle. This is how some determine their trade zones, but it’s far from complete. Maybe you’re in a rural area, with rivers or mountains; these barriers can decrease your trade zone if they reduce easy access to your store. They may increase your trade zone if they reduce easy access to competitors. Your trade zone probably varies seasonally, even if you don’t have a seasonal business. People may not drive during inclement, sloppy weather. They may not drive during very cold or hot weather unless they crave climate-controlled stores. If there are a lot of farmers near you, your trade zone may be smaller during harvest & planting times because farmers are extremely busy in their fields, unless weather conditions keep them out of their fields. They may only shop & watch movies when weather works against them. But then they may be too tired to shop. Experiment with offers allowing them to benefit from what you offer without coming to your store when it’s inconvenient, examples: Longer rental periods or sending tapes/DVDs to them. So, depending on the weather 20% of customers may live or work about 5 miles away from your store, then it may drop to 5%. If you track this, you’ll know when to distribute messages to people who are 5 miles away. If you haven’t tracked it, recall when certain people have been in your store or when you were busier. Recall which offers worked best & when. In a non-seasonal business, it’d seem any popular offer would work any time, but it depends on people’s lives being a series of seasonal activities. So, if your offer in April didn’t work, it may work in July. Or maybe you need to use a different headline or send it to other people. In “Made To Stick” Dan & Chip described how irrational some choices are. Even if people pay somebody else to do their tax work & still have discretionary money, the fact it’s tax season distracts them. Plus, think about other things. People in Hollywood wonder why “Evan Almighty” isn’t doing well. A disc jockey said people are still recovering from flooding from Katrina & other hurricanes & here’s a movie about a flood. New releases may not draw people & as for previous movies, people may think ‘been there, done that.’ But just because they were in your store & some movies didn’t appeal to them, it doesn’t mean they won’t like those movies now. Movies may be good, but because of other events or competing movies, non-blockbusters may be profitable later. Example- “Evan Almighty” may do well as a rental after the memories of catastrophic hurricanes have faded. Dennis S. Vogel Be sure your business isn’t a fading memory. People forget for different reasons & at different times. You may need different marketing methods when people are very distracted. I have some methods you need in my free information web site & this forum. http://www.thrivingbusiness.lakefield.net/ http://www.voy.com/31049/ [ Next Thread | Previous Thread | Next Message | Previous Message ]

Replies:

Subject	Author	Date
Re: The Curse Of Knowledge --.Never Assume People Know Things	Netflix Competitor	19:58:47 11/13/07 Tue
Team, Up Against Giants -- Dennis S. Vogel, 22:35:05 11/14/07 Wed