Young Upstarts

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How To Be Successful By Turning Away Customers

by Fred Perrotta, freelance marketer and co-founder of Tortuga Backpacks

Being just be another widget maker won’t get you anywhere. Most market segments can only support one, maybe two, companies.

Just being a better version of a competitor isn’t enough. Not everyone will agree that you’re “better.” Others will dismiss you as a lesser or me-too version of the more popular product before learning what makes you different.

Instead, you must differentiate. Aggressively. Even to the point of purposefully ostracizing potential customers if they’re not your ideal customers.

You must decide:

– By which measurements are you better? By which are you worse?
– Which subset of customers are you tailoring your products for?
– Who shouldn’t buy your product?

If you try to be everything to everyone you’ll get crushed by the bigger, better financed incumbent.

Luckily, in large markets, the incumbent is okay but not perfect for most of the customers. They’re too big to cater to every subset of customers individually.

Find the customers that are the least satisfied with the current solution. Then blow their minds with a better one.

Let’s look at a real world example. Then we’ll use a framework to figure out what to elevate and what to eliminate in your business.

Example: Southwest Airlines

Sure, Southwest is just one of many airlines. But, they’re one of the few actually making a profit.

How? Differentiation.

Southwest didn’t want to be yet another middling airline. Instead, they looked at all the factors customers consider when booking a flight then chose which ones they would excel at.

Southwest doesn’t offer amenities like first class, meals, or lounges. Instead, they save money so they can set lower prices.

Southwest focuses on frequent, short-haul flights between midsize cities. Other airlines use a hub and spoke system.

A strong focus on what it does well has made Southwest successful. As has their intentional disregard for unideal types of travelers.

Are you a fancy-pants businessperson who wants to be catered to in first class? Sorry, you’ll hate Southwest. And that’s just how they like it.

They’re intentionally driving away a segment of the market that most airlines would kill for.

Yes, you can be successful by pushing some customers away. But only if you do so in order to double down on making your product even better for your target customers.

How To: Blue Ocean Strategy

The ideas in this article were derived from the book “Blue Ocean Strategy“.

I highly recommend reading the book if you’re brainstorming a business idea or are creating the messaging and marketing for one.

The authors, Renée Mauborgne and W. Chan Kim, use a “competition canvas” (below) to map out all the factors that a business can compete on in their market.

Then they focus on the most important ones and reduce or eliminate the rest.

Instead of investing across a range of features, like most airlines, Southwest maximizes three factors and ignores the rest.

This strategy will cost you some customers. However, it can turn your ideal customers into raving fans.

Southwest decided to abandon the frills and big destination cities of typical airlines. They doubled down on low prices and on smaller, underserved markets.

Intentionally ignoring market segments can be tough. Most new businesses don’t have the guts to turn away potential customers. Instead, they create a solution that’s mediocre for everyone and doesn’t win them any business.

Don’t be like them.

Ignore half the market. Maybe more. Tell them to get lost.

Find a segment of the market that’s underserved by the big guys and create something just for them.

Find out what their specific problems are and solve them. Tailor everything to them. Make your solution so great, they can’t help but tell everyone like them. If you make the right product, they’ll be ecstatic. Everyone loves to find something made just for them.

Plenty of problems don’t have good solutions yet. Find them and solve them. Your audience will be homogenous enough that you can find where they spend their time (online or off) and reach them easily and cheaply.

Which segment of customers are you willing to ignore? Which segment are you going to embrace?

 

Fred Perrotta is the co-founder of Tortuga Backpacks and a freelance marketer. Contact him for help marketing your startup.


This is an article contributed to Young Upstarts and published or republished here with permission. All rights of this work belong to the authors named in the article above.

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