Do business without USP work
Faster to success with a USP
Why do some start-ups manage to achieve resounding and lasting success within a short period of time, while others simply cannot get on their feet despite a lot of advertising and active marketing?
Why are there companies for which customers simply “break the door down” while others with exactly the same products and services are simply ignored?
This article tries to give an answer to why companies, products and services are more or less perceived by customers and thus to help the reader to become more successful themselves.
Certainly, there are many factors that have to be right for a business start-up to be crowned with lasting success. This certainly includes
- a good business idea
- technical know-how
- good business partners
- a realistic business plan
- an environment that is positive about starting a business
- sustainable financing
- a secure economic environment
- a highly motivated entrepreneur who is ready to devote all of his energy and all his strength to the new company over the next few years
And although all these points are fulfilled, even though the entrepreneur invests all his manpower and energy in his project “I want to be my own boss” - the potential customers and the market ignore him. You just don't notice it. Although there can be several reasons for this, in practice one reason is particularly decisive: the company lacks USPs.
USP - what is it?
But what does the term “USP” mean and why is it so important?
In various business lexicons you can read that the term was coined in the USA in the 1940s and is mainly used in marketing and sales psychology.
A Unique Selling Proposition (USP) is the term used to describe the capabilities or properties of a product or service that make the product or service clearly stand out from the competition for the customer. The skills or characteristics that make it unique and worthwhile from the customer's point of view.
Requirements for USPs
Since the USPs are ultimately not only supposed to differentiate our offer from the offers of the competitors in the short term, they have to meet certain requirements. This includes especially
- the Customer benefit, i.e. the offer must have a benefit for the customer that is greater than the benefit offered by the competitor's offers.
- The Inimitability, i.e. the USPs cannot easily be copied and imitated by competitors. This allows the company to use its USPs to differentiate itself from its competitors for much longer.
- The superiority, i.e. from the customer's point of view, the company's offer is far superior to other possible solutions to the customer's problem.
- The Affordability, i.e. the product or service must of course be affordable for the target group, i.e. for the customers envisaged.
- The profitability, i.e. the product or service must be able to be sold at a profit on the market.
- The Distinctness, i.e. the product or service can be easily and clearly distinguished from the products and services of competitors for the customer.
- The Employability, i.e. with the possibilities of marketing, the higher benefit and the distinguishing features to the products and services of the competitors can be made clear to the interested party.
The list shows one thing very clearly: It is not your point of view, but the point of view of the customer that determines whether he sees something special in your offer that he wants and for which he is willing to spend money. Spend as much money as you want for the product or service.
Why do I need USPs - don't others do such good business too?
Perhaps you are now wondering why you of all people need USPs when others do good business without USPs and have been on the market for years.
First of all, one comment: Well-established, well-established companies have their USPs, otherwise they would not be successful in the market for years. In many cases, they were not elaborately worked out, but emerged in this way, are products of chance. Yes, they do exist, entrepreneurs with an unerring instinct for business ideas - only, they are absolutely in the minority. There is a lot to do with the saying “People who are successful overnight have mostly worked hard for it during the day.” Successful entrepreneurs are always looking for the USP, for new USPs, for the “kick” for their offer.
Successful entrepreneurs are constantly asking themselves: How can I become even more attractive to my customers? What else can I offer that my customers need? How can my offer be made even more irresistible for my customers? Successful entrepreneurs are not imitators, they are pioneers.
Because business success doesn't just fall from the sky, because customers don't buy indiscriminately, you have to offer customers a benefit - have to offer them more benefit than your competitors do. Customers aren't buying to do you a favor. Nor do customers buy for you to close a deal. Customers buy to meet their needs. Needs that are as diverse, as diverse as your customers. And what is it that makes your offer so irresistible that your customers absolutely want it? The USPs. That's why you need USPs. And that's why it makes sense to think about the USPs before setting up a business - and again and again, every day. This is what distinguishes successful entrepreneurs.
What do USPs have to do with quality?
What is quality
Quality is often equated with product quality. But quality encompasses more than just the products you manufacture and sell, it encompasses all activities that, in the broadest sense, have to do with your customers. For example, the speedy answering of inquiries, the consistent callback if you couldn't answer the phone yourself, the adherence to promised delivery times or the speedy invoicing are part of the quality in your company.
So when we talk about quality, we shouldn't just keep an eye on our products or the services we sell: Everything we do in the company has to do with quality - or with non-quality. If we look at quality from this holistic point of view, then the USPs also belong to the quality characteristics of a company. They are part of the quality you have promised and promised.
From basic quality to surprise quality
But not all quality is the same. In quality management, a distinction is made between four quality levels that build on one another.
The Basic quality is the minimum quality that the customer expects. His comment “That was nothing special” already indicates that he had nothing serious to complain about in terms of the quality of the product or service, but he is not really satisfied either. Somehow something is still missing. The basic quality is the basic quality that every company has to offer and that can usually be legally sued. If a company has problems with the basic quality, there is an urgent need for action. The basic quality is not suitable to inspire customers and to bind them to the company - or even to get new customers through recommendation marketing.
It already looks better with the Expectation quality out. That is the quality that your company's customer expects from you. His comment, such as “That was okay” or “Was pretty good,” indicates that you did what your customer expected you to do. No more and no less. You have delivered the quality that the customer knows from other companies and possibly also from your competitors. They were neither positive nor negative - and therefore interchangeable. When your customer comes back, it is for convenience, because they always buy from you - but certainly not because they are enthusiastic about you and your service. The customer does not recognize a USP in what you offer him.
The Desired quality Goes beyond it. Here he gets a quality that he didn't expect, but secretly hoped for. Very often these are services that go beyond what the customer is used to. For example, the handover of the new bathroom by the boss of the executing company personally or when the owner of the cabinet maker comes by again later to carry out any necessary adjustment work on the doors. The company's USPs already appear in the desired quality. It is precisely they who offer the customer the desired quality that he misses from the competition.
The highest level of quality and the highest level of customer satisfaction is the Surprise quality. Here the customer is offered a quality of service that is far above what he has wished for. When it comes to surprise quality, the company lives, the employees live the company's USPs. It is the surprise quality that inspires customers and that makes them recommend the company as an insider tip. The quality of the surprise is not that difficult. Perhaps you know the situation: Your customer has shopped at you, paid at the checkout and leaves your shop with full shopping bags. Your employee is already turning to the next customer to serve them. Imagine what would happen if your employee did not break off contact with your customer by paying at the checkout, if he at least opened the door for the customer and thanks again for the purchase. Or if someone were there to offer the customer to carry their purchases to the car. Or when was the last time a hotel employee offered to bring your suitcase from the car to your room or from your room to the car when you were leaving? Surprise quality can often be so simple. A company can only offer its customers this surprise quality if it knows, maintains and develops its USPs.
USPs and the corporate mission statement
The corporate mission statement is the formulated and written down mission of a company. In it the central values of the company, the company purpose, the behavior and the company goals are recorded. The company's quality philosophy is described here. The development of the company's mission statement is one of the basic tasks of a business start-up. In it he records the basic rules of his entrepreneurial activity. That is why the USPs are an essential part of the company's mission statement and must be recorded in writing with it. Every action in the company is measured against the company's mission statement. It goes without saying that the company's mission statement is binding for all employees in the company, but also for the entrepreneur himself.
Customers need USPs
Never before have customers faced such a confusing variety of products as they are today. But never before have customers been so comprehensively informed. Most customers know exactly what they want - and even more precisely what they don't want. But the flood of products and services has never been more confusing. How should the customer find his way around here, let alone filter out what is the best product for him? How should I, as an entrepreneur, offer the customer the best possible? Why will the customer choose my offer and not the competitor's offer? Entrepreneurs who cite the price as a decision criterion alone make things far too easy for themselves. Decision-making processes are much more complex - and yet very simple.
The customer has needs that he intends to satisfy through the use of financial resources. As a rule, the available financial resources are limited and many different needs need to be satisfied. There are very material needs, such as food and housing, and there are immaterial needs, such as the need for affection, for recognition, for meaningfulness. The fulfillment of needs creates benefits for the customer. As a rule, we humans act in such a way that we use the available resources in such a way that we promise ourselves the greatest possible personal benefit at the time of the decision. And because people are very different, their usage preferences are also very different. Something that is of great benefit to one person may be completely useless to another. The price is just one of the many benefits.
In the decision-making process, as described above, we weigh the individual benefits against each other and decide on the solution that we expect the highest personal benefit from at the time of the decision. And what if the products and services of the individual providers are like one egg to the next? Then the price remains the only point to compare the benefits of the individual products and services.
It is not the customer's job to find out how our products and services differ from those of the competition. It is our job as entrepreneurs to provide them with these decision-making criteria. We need to be able to explain to customers why it is more beneficial for them to buy from us than from our competitors. To do this, we have to know our USPs and have to communicate them to the outside world. Information about our products and services is also information about our USPs.
USPs in the business plan
If the business plan is really what its name suggests, namely the plan on which our business activities are based, then the business plan must not only deal with the numbers and business expectations, but also with our USPs. Because our business success is based on them. They are the basis of our sales planning and thus the basis for the P&L plan and for financial planning. And the business plan has another advantage in this context: It forces us to put our ideas down in writing and put them into concrete terms. The entrepreneur has the opportunity to control his company himself and is not controlled by external influences and developments. The entrepreneur thereby becomes an entrepreneur and no longer someone hounded from outside.
That alone should be worth maintaining and updating the business plan beyond the start-up phase. But how many business plans finally disappear in a drawer when the bank has agreed to finance the start-up project, investment or rescheduling? How many entrepreneurs take the opportunity to act themselves and prefer to be driven from the outside? The time you invest in the business plan and its maintenance is by no means very well spent. Therefore my appeal: Deal with your business plan and your USPs. They are the guarantors of the success of your company. They are the pillars on which the success of your company rests.
And another tip: take your time and take your time. In the company you see your company from the inside, you see your problems and weaknesses. Look at your company from the outside, look at it from the point of view of your customers, from the point of view of your house bank, from the point of view of your suppliers and from the point of view of your employees. You will likely find a number of things that need to be improved. Points where you can start your company's USPs. Many entrepreneurs find such considerations easier when they are jogging, cycling or simply walking around the houses or through the fields with their dog. It doesn't always have to be the Camino de Santiago that leads us to think outside the box.
It can make perfect sense to call in a qualified external consultant. He only knows your company from the outside and is trained to look at companies with critical eyes.
Why USPs help you start your own business
Convince business partners
According to the “VR-Mittelstand direkt” newsletter from the Volksbanken-Raiffeisenbanken, a quarter of the insolvent companies are start-ups that have only been on the market for one to two years. It is hardly surprising that suppliers and landlords have very little trust in you as a start-up. The consequences of this distrust are clear: worse contract conditions, higher deposits, prepayment or cash on delivery. Supplier credit and payment with an appropriate term of payment: Nothing. The young company urgently needed these loans to relieve the bank's commitment. A good and coherent business plan and, above all, written USPs that are understandable for the interlocutor help to improve the situation. Real USPs create trust, also with suppliers and other contractual partners.
From the banks' point of view, start-ups and young entrepreneurs are often risk customers. Nobody gets it so closely when start-ups and young entrepreneurs fail like the loan officers of the banks. There is hardly a company that can be set up without bank help. Be it the current account credit to bridge the start-up phase of the company or the large financing to make the start of the company possible, to buy machines and material, to advertise and to bridge the lean period to the break-even point. The vast majority of company founders do not have enough funds of their own and, from the bank's point of view, the collateral is often poor.
How is a banker supposed to have confidence in a business start-up when he regularly sees in black and white on his desk that even established companies in the industry are getting into trouble and, despite the help of banks, are unable to manage the turnaround or are much too late? The result: Many banks categorically refuse to finance start-ups who have not been private customers with them for many years. And even the banks, which, like many savings banks and cooperative banks, are still very open to business start-ups, are now critically examining the business idea and the prospects for success.
It is not the banker's job to look for arguments as to why the new company will be successful. This is where the entrepreneur is in demand. A good business plan with USPs that are understandable and credible for the banker is essential for this.
USP and start-up grant
Founders who want to set up their new company out of unemployment are very often dependent on a start-up grant from the Federal Employment Agency. While there used to be a legal entitlement to the start-up grant from a certain remaining term of ALG I, which was not subject to the discretion of the clerk, completely different rules now apply here. Now the clerk decides at his own discretion about the distribution of the funds for start-up grants, which have been greatly reduced compared to previously. The result: The start-ups of ALG I recipients supported by start-up grants are falling drastically.
But here, too, not all efforts are in vain. Business start-ups can still be funded by a start-up grant. But now, in addition to an external expert, the clerk is also checking the sustainability of the planned existence. It is also important to convince him - and he knows how many of his start-ups are looking for work again after a year because the start-up project has failed because the start-up did not offer a viable full existence. Both the expert and the clerk want to be convinced. And you will already suspect it: A coherent, realistic and comprehensible business plan and plausible, credible and written USPs are essential for this.
When do I have to deal with my USPs?
Now that I've convinced you of the need for powerful USPs, you may be wondering how to get your USPs. And don't you have time until later to deal with the USPs? After all, there are so many more important steps to take now. Rooms have to be looked for, suppliers found, financing clarified with the bank, insurance policies, and and and ...
The question of “when” is quite easy to answer: Immediately after you have determined the range of services and fields of activity of the new company. The question of the USPs is one of the fundamental questions of every entrepreneur. As stated above, there is no successful company without USPs. That is why the USPs are just as important as the company's field of activity. No city needs a tenth carpenter who does everything in the same way as his nine long-established colleagues. No village needs a third baker, whose products and services are in no way different from those offered by its two colleagues and the three supermarkets. As a start-up you have to be different from your established colleagues. If you want to gain new market shares, you have to break new ground. If customers see no benefit in switching to you, they will go where they always went. Because the old business has at least one USP: As a regular customer, the customer knows his way around there, the store and the employees are a familiar sight, he knows what he is getting for his money. So why should he switch? So it's very clear: When and how often do you have to deal with your USPs? The answer is very clear: as soon as the start-up idea begins to mature, and then permanently. The search for USPs, for more and more customer benefits, is what drives successful entrepreneurs.
USP in the public image
If customers choose your products and services based on your USPs, if you want your customers to prefer your products and services to those of your competitors, your customers need to know your USPs and the USPs of your products. You probably know it: rattling is part of the craft. Therefore, it is not important that you tell your potential customers that you are there and where they can be found. First, tell your customers why they should buy your products and services in the first place and why they should not use the range of the competitors. Only when your potential customers want your products and services are they interested in who is offering these products and services, where the company is located and how best to contact them.
USP and company name
It is of course ideal if the company name not only indicates the activities of your company, but also allows conclusions to be drawn about your USPs. If not - as is the case with sole proprietorships or partnerships - statutory provisions require that your name be mentioned in the company name, check that your name is really required as part of the company name. As a rule, the customer cannot imagine anything under “Max Meier GmbH”. The "Bäckerei Max Meier GmbH" tells him that the company is a bakery, but why he should buy from this bakery is not clear to him from the company name. It is different with the "Altusrieder Holzofenbäckerei GmbH". It immediately suggests traditional manufacturing processes and recipes to the customer as USPs. The smell of fresh bread practically permeates the company name.
Of course, that doesn't mean that your name as an entrepreneur cannot also represent a USP. If your name has a particularly effective advertising function through radio, press or regional engagement, and contains a promise for the customer, then it also represents a USP and has its justification in the company name.
And what do you do then as a sole trader or as an entrepreneur in a partnership? Here it is required by law to include your first and last name in the company name. However, there is of course the option of adding a positioning to the company name - practically as a second line. Your bakery is then called “Bäckerei Max Meier - Der Altusrieder Holzofenbäcker”.
However, it should not be overlooked that a reference to the USPs of your company in the company name only makes sense if you can assume that your USPs will last over the long term. Changing the company name is not only time-consuming, it also confuses and unsettles your customers. So you should be very, very careful with it.
USP and corporate identity
If a reference to the USPs in the company name is already very effective for the customer, it is essential in the company's appearance.
This starts with the design of your logo or your lettering, from which the customer should be informed not only of your field of activity, but also of your USPs and extends to your entire company appearance, from business cards to vehicle lettering and flyers for yours Services and products.
How should your potential customer recognize, when you as a stonemason use your trade mark as your company logo, that it is your USP to implement your own artistic designs? That's why you create a logo that is distinctive and connects you with your USPs. Or even better: hire a good advertising agency to do this. Over the next few years and decades, the logo will be the symbol by which you will recognize your customers. Remember how long good logos will last. Can you remember the last time the Red Cross, Siemens or your sports club redesigned their logo?
Of course, your business cards, your stationery, the design of your business premises, your company sign and the lettering on your company vehicle should also convey your message, i.e. your USPs, to the outside world. Ideally, this is already achieved through the company name or your logo. And if your USPs are not evident from this, please point them out. Always remember: only when potential customers know your USPs will they come to you because of it. We are flooded with stimuli every day. Our brain is therefore trained to perceive above all that which is particularly important or interesting for us. Everything else filters it out, we either don't notice it at all or we immediately forget about it. However, this also means that the readers of your advertising, the passers-by who see your vehicle or your shop window, quickly forget this - and thus also your USPs. Therefore, do not miss any opportunity to repeatedly refer to your USPs. Your potential customers need to know your USPs if they are to make a decision about your offer. But that alone is not enough: you need to remember your USPs precisely when they are looking for your products and services. What does it help if you know that your favorite pizzeria bakes the best pizza far and wide and has great opening times when you are desperately looking for a pharmacy where you can still get a remedy for your cold in the evening? Perhaps the pharmacy two blocks away would still be open at this time, but you don't know because they never advertised with it or you ignored the advertising because you simply had no need for this USP up to now. Therefore do not miss any opportunity to refer to your USPs!
USP and advertising
The fact that your USPs should be the core message of your advertising message certainly no longer needs to be mentioned separately. Advertise with your USPs. Regardless of whether it is advertising, your shop window or company flyers: Your USPs should form the core of the advertising message. Forms of advertising such as the shop window, inserts or advertisements are quite suitable for pointing out short-term USPs such as time-limited service offers or particularly low prices.
In this context, your presence on the Internet and in the area of social media such as XING or Facebook is of particular importance. Here, too, it is important to point out your USPs again and again. Many young companies have very interesting websites - but nobody can find them. Assume that the Internet user is usually not looking for your company name, but rather for products, services, USPs and regions. With these terms you have to be found by the search engines and listed at least on the first page.
The combination of USPs and advertising also has a completely different side. Remember that advertising with your USPs is often an advertising promise and failure to comply with it can result in expensive warnings. This is especially true for statements on the Internet.
The topics of marketing and advertising are of particular importance to business start-ups, as founders are usually still unknown on the market. Sure, engaging an advertising agency costs money - but a good advertising agency is definitely worth the money. A good advertising agency is able to translate your USPs into the language of advertising, into the language of your customers.
This also applies to the creation of your website and especially to the search engine optimization of your website.
Examples of USPs
The USPs of companies are just as diverse and multifaceted as the corporate landscape as a whole. At this point, only a few examples of the USPs of companies are shown.
USP in the range of products and services
- The garage, which is open until 10 p.m. for urgent repairs
- The heating contractor who maintains a 24-hour standby service even on Sundays and public holidays
- The bakery with regular international weeks
- The inn with agriculture, which mainly uses organic products from its own production
- The electrical shop that also disposes of old devices
- The hairdressing business that also offers in-depth style advice
USP in product quality
- The butcher's shop, which shows exactly which farmer in the region the meat that is currently on sale comes from
- The restaurant with recipes that really come from the time the house was founded around 1850
- The boutique that only sells clothing that has been proven not to come from child labor
- The carpenter who works exclusively with solid wood
USP in service
- The pharmacy with delivery service until 10 p.m.
- The craftsman who of course removes the dirt in the customer's apartment
- The specialist shop for dog accessories that also offers lectures on dog health and diseases
- The clothing store with a 24-hour change service
- The cleaning, with 12-hour express service
- The turning shop that supplies a meaningful measurement and tolerance protocol for your products
- The floor layer who offers regular professional inspection and cleaning of the floors
- The car repair shop that briefly notifies the customer by phone or SMS when his vehicle is ready to be picked up
- The delivery service that provides the customer with a binding and appropriate small time window for delivery
USP in order processing
- Answering inquiries within six hours
- The delivery of orders on the day of the order, so that they are guaranteed to arrive at the customer the next day
- The short confirmation of the order and order data for orders over the phone
- The creation of a written acceptance report by the builder and master craftsman at the tiler
That's how it's done
The company's USPs can be systematically worked out using methods such as benchmarking, but often they come as thought fragments completely unexpectedly, usually when you can break away from day-to-day business.
The notepad on the bedside table
It doesn't matter whether you have the idea for your USPs while jogging or driving, or whether you come up with it at night. Write down your thoughts and thought fragments. You don't have to translate these thoughts into realizable programs and services right away. Just write down your ideas so they don't get lost. The implementation can take place a little later if you have the time to think about it in peace.
Integrate the environment
The next thing is: talk about your start-up plan. Talk about what you want to offer and how you want to stand out from your competitors. You will see that these conversations, whether with your partner or with friends, often provide you with very important new aspects and ideas. Please don't forget to write down these ideas.
And one more tip: Don't be too quick to dismiss such thoughts as senseless or unrealizable. Often there is an important core in these thoughts that you should simply work out in order to then come to an implementable idea, your USP.
Benchmarking is essential
Benchmarking is the systematic comparison with your potential competitors.
To do this, first determine who your main competitors are. Please do not only think of shops that sell your products as their main products, but also of all those for whom your products are important by-products, such as the bakery shop and the supermarket in the case of a bakery.
In the next step, you put yourself in the shoes of your customer and ask yourself which criteria could be important for your customer when making a purchase decision. Ideally, you can think of at least ten to twelve criteria that are important to the buyers of your products and services.
Then make a table in which you enter the criteria in the rows and the competitors and your company in the columns. Then rate the individual criteria for yourself and each of your competitors on a scale from 1 to 5 (1: poor or not available, 5: very good).
Next, take two highlighters and use them to mark the company with the most points in one color and the company with the second most points in the other color for each criterion. Now the USPs of your company and your competitors are right in the eye. You should have the highest score for at least two criteria and the second highest score for two other criteria. When that is true, your company is well positioned in terms of customer interest.If you cannot meet these criteria yet, just think further about how you can improve your offer and your services so that you are more interesting to potential customers than your competitors.
For a bakery, for example, the evaluation of the benchmarking could look like this:
|criteria||My bread||Schmid bakery||Bakery always fresh||Supermarket cheap|
|Early opening times||5||5||4||4|
|Friendliness of the shop assistants||5||2||3||1|
|Cleanliness of the sales room||5||5||4||2|
|Long opening time||2||3||1||5|
|Sunday afternoon opening||3||1||1||1|
|Products from other regions||3||4||5||2|
The evaluation of the table shows very nicely where the USPs of the bakery “Mein Brot” are. Particularly attractive for customers are:
- Friendliness of the shop assistants
- Organic products
- Parking facilities
- Changing assortment
These are the company's USPs and these should be highlighted and advertised particularly intensively.
But also note that you will measure your customers against your USPs. Don't make promises that you can't keep.
Benchmarking is particularly effective if you don't do it alone, but also involve your friends and acquaintances. Then not only your view is included in the evaluation, but also the feelings of others. This makes the evaluation much more realistic.
And one more important note: don't lie to yourself. Be critical not only of your competitors, but also of yourself.
The USPs give your company, your products and your services the uniqueness you need to survive in the market. Successful companies all have their USPs. You should therefore seriously think about where your USPs should and will be at an early stage, if possible in the pre-founding phase of your company. Keep rethinking your USPs from the perspective of your customers. How important are those points to your customers that you particularly emphasize as a USP?
Do not stop developing your USPs and thus becoming more and more customer-friendly and more interesting for your customers. Be sure: if your competitors notice that you are scoring points with customers with your USPs, they will also try to jump on the bandwagon. You can only protect yourself against this if you are always at least one step ahead.
Don't stop promoting and promoting your USPs at every opportunity. Only if interested parties know your USPs will they consider them when making a purchase decision. Remember: the USPs are where you are superior to your competitors. Then why false modesty?
And another important tip: get help with setting up your own business. As a rule, you are the specialist for your products and services. Get support in setting up a business from people for whom business start-ups are their daily business: from experienced business start-up consultants. It is not for nothing that the state subsidizes the advice of start-ups and start-ups.
Good, professional advice is not free, but it is always worth the money.
Author: Hans Zeilinger
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