Prosper Newsletter: April 2007 > Entrepreneurship

You understand that the following information is educational in nature and is not intended to be legal, accounting, or tax advice. You are responsible for your own financial decisions and should consult your own legal, accounting, and tax advisors before making your financial decisions.

Developing a USP

One key to all business is to understand that the marketplace, whether it is product, information, or services, has a tendency to be commoditized. Commoditization means that the price becomes the main differentiator between your product and the competition. If you want to be successful in business, avoid going into a business where you have to compete on price alone because it is not a sustainable competitive advantage. In order to succeed you need to come up with a unique selling proposition or USP.

In 1961, a book was published that quite literally revolutionized advertising. This book is entitled, Reality in Advertising, written by Rosser Reeves. He came up with the phrase "unique selling proposition." He used this concept to build multiple multi-billion empires. The concept is to find a way to differentiate from everybody else.

In his book, Reeves gives the following three conditions for a USP:

1. It has to be something that your competition cannot or does not offer.
2. It has to be compelling enough to draw people to it.
3. It has to be true - no puffery, no flattery, no exaggeration.

Creating Your own USP

When you are creating a USP you are not just creating a slogan or a byline. A unique selling proposition is just that - it is propositioning, promising something. It is compelling. It is true and factual. It is something that your competitors can't do, or won't do, at the moment.

If you think that the creation of a USP is simple and quick and that there is some formula to follow - there is not. It takes time and effort and a lot of thought to be able to put an effective USP together. But there are steps you can take that will help you through the process.

1. Define the specific target market you are going after.
   1. A target market is nothing more than individual people who have a certain common bond. The bond could be a hobby, skill attributes, religious background, age, gender, etc. There are four primary markets in the world:
      1. Government: all levels of governing bodies, city, state, national, international, etc.
      2. Institutions: non-profit organizations, churches, etc.
      3. Business to Business: any business that sells directly to another business entity (i.e. Office Depot)
      4. Business to Consumer
   2. Define the demographics of your chosen market:
      1. Are you targeting to men, women, or both?
      2. Is there a particular age group or age range you are targeting?
      3. Are you targeting married couples, singles?
2. Competitive Analysis
   1. What are competitors already offering?
   2. What are the gaps in what is already being offered?
3. Dan Kennedy's "What's your greatest frustration?"
   1. Every business or service has a frustration or a barrier built into it. (i.e. Medical Doctors: people's greatest frustration is wait time)
   2. Look for the key frustration in your industry.
   3. Talk to people within your target market, and listen to what they say.

Ask yourself, "What is going to make my product different, better and special?" It's not just the idea of being different than everyone. It's the idea of being better than everyone else, being special. Find your competitive advantage. Identify the way that the customers, prospects, and players will know you in your particular industry. Create a significant point of differentiation. Some possible examples are: greater selection, exclusive items, one-of-a-kind items, custom items, target market, shipping options, etc. It doesn't have to be extraordinary; it could be something quite simple. The closer you are clustered with other competitors in the minds of the consumers, the more you are forced to compete on price.

Thoughtful Planning and Evaluation

Since the start of the 2007 New Year many business owners may have neglected the true task of planning. Many people plan and strategize over budgets, tactics, and lengthy analysis of what they would like to accomplish throughout the year. Many will forecast sales and operating expenses to the most finite details with the intention of following through till the end. Well the end of Q1, and the beginning Q2 of 2007 is almost nigh at hand, and now is an excellent opportunity to evaluate the progress you've made so far.

How close are you to hitting those sales goals? How close are you to acquiring the number of customers and clients you need to increase your bottom line according to projections? It is a great re-evaluation point for those fantastic goal-setting sessions you had in 2006. Take some time to test, measure and evaluate exactly where you've ended up so far, and recalibrate if necessary. We hope that 2007 continues to be a year where you all may prosper.

HOME | PARTNERS | PRODUCTS | TESTIMONIALS | SUCCESS CENTER | ABOUT US | CONTACT | SITE MAP | PRIVACY POLICY | CAREERS