Australian Business Coaching Club Newsletter - Dare to Be different

 

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Dare to Be Different 

How do you stand out from the crowd? Business owners often struggle to create points of difference in a me-too world. Which is why my ears pricked up when I saw the latest Kia ad.

The Kia product is ranked in the middle of the “affordable” automobile class, but there are many others in the same category. Buyers in this range tend to be budget conscious, but like many others at this time in the economic cycle, are not buying new cars because of the uncertainty. Buyers of these vehicles are purchasing not for prestige, but because they need a car for mobility, maybe a first car or a replacement for a car that is near the end of its life. Their need is real, and a Kia is within their budget, affordable, not flashy. So if price is not preventing their purchase of a vehicle from this class what might be?

Kia research must have shown that the biggest barrier to purchasing is the concern by their buyers that they may not have a job in 6 months. So what Kia did was offer a guarantee that if the purchaser loses their job in the next 12 months, they could return their car.

Are they crazy?

While the level of unemployment is a concern for everyone, a forecast increase of 1-2% only is expected. Also, as the purchase was one of need, the likelihood of return is low, but even if it is returned, it can be resold with only a small loss. Overall, the risk is low for them.

Don’t you think this makes them stand out from their competitors?

Would it work for BMW? The motives for purchasing a BMW are very different than for a Kia, and the decision is driven much more by emotional desire then true need. Potentially the buyers in this category may not perceive their jobs are at risk - they are the ones that do the firing (although the reality may be very different), and for BMW the risk of returns might actually be greater, as the car is likely to be a second car, and even if it is not and they still need a car, they could buy something cheaper, such as a Kia, and still have change left over when they return the BMW. An important consideration if you have just lost your job.

What is the greatest impediment to purchase of your service? How can you take that risk away and stand out from the crowded marketplace. You will find that the risk with a well constructed guarantee is small, it makes you stand out, and all your competitors just think you are crazy. But I won’t tell them otherwise if you don’t.

Have a great week!

Dr Greg Chapman - The Business Brain Surgeon
The Australian Business Coaching Club