Differentiating an O-ring is no easy task. Often it comes down to a battle over price. This is the case with many commodity-type items because, ostensibly, they are all very similar. This trend has been accentuated by the current economic state of the United Kingdom and public-sector spending cuts. Needless to say, the market pressures are a significant factor.
During such climates, marketers have historically bolted on service offerings to help differentiate themselves. Intense price competition spurs such tactics.
So what’s new about that? Market leaders have been doing that for decades. My client DAF built its entire marketing platform around service in the nineties, for example. It has worked tremendously for DAF, and with good reason: Its service is industry leading.
Still much has changed during the past 20 years. While DAF was able to own service, many competitors viewed it as added value. Today, uber-competitive markets are forcing others to lead with service.
This approach is even true of exceptional market leaders like Marshalls. Marshalls dominates the United Kingdom hard landscape market. (The company manufactures paving and other products.) It is often the first to innovate and its ethics are above reproach, which has been a successful formula.
Still, Marshalls is continually undercut by “me-too” competitors selling what they claim to be like-for-like concrete products.
To compete with such pricing pressure, Marshalls has also bundled in technical services including expertise such as market-leading specification, technical and regulatory advice. Marshalls has always offered these benefits to clients, but it is now a larger focus.
Leading with such value-added services has affected a positive mind shift among customers. It has successfully headed off the price-driven, short-term conversations that the market is driving.
This needs-based approach is separating the superior from those who have only price to offer.
Ultimately, it is enabling strong brands such as DAF and Marshalls to win based not only on product, but also the expertise that they can bring to the table. While this tactic is helping these two companies win in the short term, it has lasting benefits as well.
Customers recognize that it’s not just a commodity they are buying. Instead, they are being educated about their suppliers’ depth of expertise.
By Danny Turnbull
Follow Danny on Twitter @turnbulldanny
Originally published at Ignite Something on the Forbes CMO Network