I’ve recently started working with a client who runs a market & competitive intelligence SaaS.
Up until the point that he launched his company, his prospective customers had the choice between either paying consultants to do the work for them (and pay their hefty fees) or do the work themselves to generate the information they need.
His business model was to essentially cut out the middle man (the consultants) and provide his clients with a user friendly direct access to the information the consultancies used to provide them with intelligence.
And, as such, his solution is many times less expensive for his customers than if they hire a consultant to provide them the same work.
On top of that, there are no limits on how and when they can access the information they want — if they wake up at 3am with a burning question, they can login straight away and get the answers they want.
Previously they would have had to played the waiting game — wait to speak to the consultant, wait for them to get back to them with the answer, wait to ask them any further questions..etc.
Great, innovative features and great benefits — much better than the existing solution.
But his biggest mistake was to focus on those features and benefits in his go-to-market messaging
So many businesses fall into the trap of believing that their benefits and features will get them the growth and clients they want — especially when, in the beginning, it seems to work.
With some objective proof that their solution was trustworthy and worked, my client began their business by selling off the back of the benefits of ‘saving money’ and ’24 hour access’.
The business got off the ground and was growing, but this reliance on selling features and benefits would soon have serious consequences.
THE COMPETITION ARRIVES
Image credit — chiefmartec.com
Noticing his success, other entrepreneurs had started jumping into this market — creating competing offerings of their own.
Soon my client was one of many offering cost savings to this market.
What’s more, fed-up with having their client’s poached, the consultancies started fighting back — they created similar software to provide to their clients for free to supplement their consulting work.
This is why features and benefits selling simply doesn’t cut it in today’s highly competitive world.
Innovative features and benefits are copied quickly and rapidly by the competition — rendering any differentiation based upon them completely useless
CREATING A SUSTAINABLE DIFFERENTIATION AND GROWING THE MARKET
In order to distinguish himself from the mass of competing solutions in his market, my client hired me to help him create a sustainable differentiation for his solution — now that his features and benefits had been copied.
In reality he really shouldn’t have waited this long — by selling his solution based the on features and benefits he gave a green light to anyone who wanted to jump into the market, as features and benefits are easy to copy.
If he’d have started off with the right differentiation to begin with, he could well have avoided the influx of competition or, at the very least, reduced the impact by a huge margin.
He also wanted to make inroads into the part of the market that has been ‘doing-it-themselves’ for so long — a segment that his features and benefits based approach had not been able to a crack.
The features and benefits approach simply doesn’t give any kind of solid reason WHY someone should change their status quo.
The vast majority of businesses aren’t in the market for whatever it is you are selling — they are happy with their status quo. If it ain’t broke, don’t fix it.
If one wants to shake them out of that status quo, one has to show them that it is broke and they do need to fix it — but features and benefits don’t provide that ‘oh crap’ moment.
SELL A PHILOSOPHY TO DIFFERENTIATE AND GROW
What my client needed was a brand new strategic narrative — a narrative that gave a solid and compelling reason WHY his prospects should ditch their status quo and why they should choose HIM over the ever-growing list of competitors.
Features and benefits don’t do it, but a new ‘philosophy’ absolutely does.
Selling a philosophy is, specifically, selling a specific vision and viewpoint on how one’s customers/clients/prospects should go about achieving their goals and/or overcoming their challenges.
The solution is simply a tool to be used to help the prospect implement the philosophy that is being sold.
This is exactly what some of the fastest growing and most successful companies in the world do:
- Drift doesn’t sell an AI bot — it created and sells the philosophy of ‘conversational marketing’
- Hubspot doesn’t sell a marketing platform — it created and sells the philosophy of ‘inbound marketing’
- Salesforce didn’t sell a CRM when it launched — it sold the philosophy of ‘The End of Software’ (this has since evolved as the company has grown & times have changed)
By ‘coining’ a new approach (aka a new philosophy), these companies were able to differentiate themselves from their competitor’s who sold (or very quickly came to sell) the very same features and benefits as them.
These philosophies were then wrapped in a narrative about a changing world that explains WHY that philosophy is so important and vital to implement now.
- Drift talks about how B2B buyers now interact via instant messenger most of the time — as such they prefer to have conversations with companies, not fill in email capture forms
- Hubspot talked about how interruption marketing is outdated in an internet world — the future was all about attracting customers to approach you
- Salesforce talked about how the world of legacy software was broken — the future was cloud based
This is the approach I take with my clients, and the approach I’m taking with this SaaS company.
THE RESULTS SO FAR
We’ve put together an initial philosophy and narrative about a change in the that he has been testing out with both warm and cold leads.
The difference has been night and day and, although his philosophy and messaging need to be tweaked (an ongoing process in reality), it seems like we’ve hit upon the right combination — prospects are no longer making comparisons between his solution and his competitors, they buy into his vision for their future and are excited about the possibilities that he can bring them.
What’s more — companies that previously were doing it themselves are now starting to enter into serious conversations with my client to purchase his solution.
What remains is to align his product further with the new philosophy he is selling and to continue to refine his message and he’ll have created a market position that his competitor’s cannot hope to emulate (so long as he remains committed to his philosophy and doing everything in his power to helping them implement it within their company).