In the PricingBrew Journal, we recently fielded an interesting and somewhat disturbing question from a subscriber:
What if our competitors are outperforming us on every value-driver that really matters?
Imagine finally making the effort to understand what your prospects and customers really value—brainstorming potential value-drivers, conducting the qualitative and quantitative research, and so on. Then, conducting the competitive analysis to determine how your offerings stack-up relative to the alternatives on those value-drivers that your research determined to be important.
And after all of that, what do you discover? Your offerings stink. Not only do they fail to provide positive differential value relative to the alternatives, they actually suffer greatly in the comparison.
So, what do you do? Assuming that your research and analysis are accurate, how should you respond to the ugly truth? Here are a few options:
- You can ignore reality and just keep going. Of course, it’s likely that you’ll only win business where the prospect is either very ignorant or just too lazy to do any research on what they’re buying. Obviously, this option is not recommended unless you’re independently wealthy or already have one foot out the door.
- You can rally the troops and get to work on shoring-up the areas where you are falling behind. The work you’ve done to get to this realization in the first place can be an effective catalyst to drive meaningful action, while also providing a roadmap as to exactly what needs to be fixed or further developed.
- You can price your offerings to align to the limited value they provide. As a result, you’ll likely only win business from the pure price buyers in the marketplace. And you’ll probably get caught in a vicious cycle where you can’t generate enough profit to fund further development and growth. But hey, it’s an option.
- You can figure-out what you do excel at—the value-drivers you do win on—and change your targeting to go after the prospects who value those things. After all, if the fish aren’t biting, you can either change your bait as the second option implies, or you can pick-up your gear and fish in a different pond.
Obviously, only a couple of the options presented here are worth serious consideration. But the point is that there are indeed options—you don’t have to live with a losing hand. Once you understand the reality of the situation, you can take action to change your fortunes.
