Differentiation Strategy

Creating the Right Niche Marketing Message

In his book The Ultimate Marketing Plan, marketing guru Dan Kennedy says that effective marketing starts with creating "the best, most promotable message possible that truthfully represents 'the goods' you've got".

You can break that down into three components:

• Creating the best marketing message - or USP. That means a message that explains what makes your small business different - different in a way that your potential customers really want.
• Telling the truth about what you can do for someone - you are a small niche business offering something particular. You can't be all things to all people.
• About what you can deliver to your customers - there's no point in attracting customers and then disappointing them.

Dan Kennedy suggests you look at a Yellow Pages directory for the type of small business you intend to start up. For the first advert, write down every "promise, feature, benefit and statement". Then look at the next advert. If this advert repeats what you've already written down, put a tick next to the promise, feature, benefit or statement. If there's something new, write it down. You'll most probably discover a big mistake small businesses are making: they all have the same marketing messages. They have no differentiation strategy.

Of course, all these small businesses may not be the same. It may just be that they do a poor job with their marketing messages. So, for each of your likely competitors you can consider whether they are different in some way. Can you improve on their idea? Can you come up with something new - something that potential customers really want?

Then you can come up with your own differentiation strategy - your USP or Unique Selling Proposition. Dan Kennedy suggests that you make notes of all the promises, features, benefits and facts from other small businesses - or ideas you have come up with yourself. Then try and work out which are the most important, those that will be really attractive to your customers. The ideas on the top of your list should form the basis of your USP. Of course, make sure that you can deliver on what you promise.

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