Five out of seven business start-ups in South Africa fail in their first year according to Rob Davies, Minister of Trade and Industry. Globally, one out of two start-ups fails during its first year.
HomeTimes wants you to succeed as an entrepreneur and to live in the home of your dreams. To enable you to do this we have secured the rights to serialise the book, How to Survive and Thrive as an Entrepreneur, by author, business owner and serial entrepreneur, Neville Berkowitz (63), who shares the secrets he has learned over the course of his 40 years as an entrepreneur. Kele Scheepers co-authored the book.
Thanks to Berkowitz’s website, PersonalEmpowerment.co.
2 Finding a unique selling proposition
With so many products and services in the market, this can be one of the most challenging aspects of building your business – differentiating your offering from that of your competitors. This is what makes your business stand out from the crowd.
A unique selling proposition (USP) is a marketing and business tool which helps customers by stating simply and clearly why your product or service is different and will better satisfy their needs. You can use your USP to provide a focus for the promotion of your business.
In order to establish your USP, you will have to conduct intensive industry research to gain a thorough understanding of the alternatives that your prospective customers can already access.
- Who else fulfils the same need that you do?
- What strengths do their marketing materials focus on?
- Can you identify any weaknesses that you might be able to incorporate into your product or service?
- What issues are your target audience facing with competitors’ offerings? What could make the customers’ lives easier?
- What can you guarantee that no-one else can?
Brainstorm to create a list of everything good about your business – be as detailed as possible. Run through the entire process of creating your product or offering your service and see if you can showcase any step that has not been marketed or utilised by competitors. This step could serve as your USP.
Talk directly to customers to get more information about what your competitors might be overlooking – for example, listen out for issues related to unsatisfactory customer support, excessive delivery costs, complicated payment procedures or limited technical support. Your USP has to add value to the customer and should answer the customer’s question, “What’s in it for me?”
In order to uncover your unique selling proposition, you must have a good idea of what motivates your customers’ behaviour and buying decisions. Rather than just looking at customer demographics (i.e. their age, gender, race, income and location), think of the psychological needs or desires which you can fulfil, be it status, relationship-building, vanity, luxury, glamour or identifying with particular social circles.
Your USP could be based on a characteristic of your product or service, your price point, your location or distribution, or the way you promote your offering. These aspects could give you a market position which sets you apart from the competition.
Keep in mind that USPs usually do not last forever as new competitors enter the industry and offer additional features, so you will have to review your USP over time.