What is USP? Determining the USP for Revenue Optimization
In the current business process, you must have heard a lot about the term USP or Unique Selling Point . USP is likened as a guideline to help determine long-term business strategies and optimize profits of companies and businesses.
So what is the real USP? How big an impact does the USP have on your product? Let’s explore together with Malu.
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What is USP?
USP (Unique Selling Point) is defined as a unique selling point or feature, offered by a seller or business. USP is considered as a way for a business to stand out among thousands of other competitors, defining a company’s unique position in the market.
A strong unique selling trait will allow you to set yourself apart from your competitors. Besides, Unique Selling Point orientation helps you to focus your energy on creating things that serve the ideal customer group and create brand valuation power.
Before you can start selling your product or service to anyone else, you need to sell yourself on it. This is especially important when your product or service is similar to others. Very few businesses are unique, one-of-a-kind. Just look around you: How many clothing retailers, snack shops, air conditioning installers, and phone repairers are truly unique?
The key to effective selling in this situation, what advertising and marketing experts suggest, is the “unique selling trait” (USP). Only when you determine exactly what makes your business different can the whole company’s sales efforts be successful.
According to Theodore Levitt, Professor at Harvard Business School, “Differentiation is one of the most important tactical and strategic activities that companies must constantly engage in.”
Defining the USP requires creativity and hard work. One way to start is by analyzing how other companies are using Unique Selling Points to their advantage. This requires careful analysis of advertising campaigns and marketing messages. When you analyze your competitor’s USP, you don’t just get information about the characteristics of that product or service. It is also possible to learn and learn the ways in which companies differentiate themselves from their competitors.
For example, Charles Revson – the founder of Revlon (a large cosmetic company in the US) always says that he sells hope, not makeup. Some airlines sell friendly service, while others focus on on-time service. Neiman Marcus sells luxury goods, while Wal Mart sells cheap goods.
Each of the above companies is an example of how they have found their own USP to guide their marketing strategy throughout. A business can base its USP on product features, pricing structure, location strategy (location and distribution), or advertising strategy.
Those are what marketers call the “4Ps” in the Marketing Mix. The 4Ps are used to give a business a distinct market position from its competitors.
1. Put yourself in the customer’s shoes to determine the USP
It is very easy to happen when entrepreneurs love their products and services too much and forget that the needs of their customers are the most important thing that they have to fulfill. Track your business on a daily basis and scrutinize what your customers really want to pick out the USP .
Suppose you own a pizzeria. Sure, customers come to your store because they want pizza. But is that all they want? What can make them come back again and again and ignore your competitors? The answer can be product quality, convenience, reputation, friendly staff, clean space or preferential service for regular customers.
Remember, price is never the only reason a customer chooses a product. If your competition beats you on pricing strategy, find another selling feature that meets the customer’s needs. Then build your sales and advertising efforts around that feature.
2. Understanding the motivations and buying behavior of customers
Determining the USP for effective marketing requires you to be an amateur psychologist. You need to know what motivates and drives customers.
Not simply the traditional way of analyzing customer demographics such as age, gender, race, income and geographic location. What most businesses collect to analyze their sales trends.
For the pizzeria example, surveying to know that 75% of your customers are between the ages of 18 and 25 isn’t enough. You need to consider what motivates them to buy pizza? Taste, Convenience, etc
Cosmetics and alcohol companies are great examples of industries that know the value of promoting psychological orientation. People buy these products based on their desires (for beautiful, luxurious, glamorous women, etc.), not based on their needs.
As your business grows, you’ll be able to ask the best source of information: your customers to determine your Unique Selling Point . For example, a pizzeria owner might ask customers: Why do they like their pizza better than others? Plus ask them to rate the importance of the features the store offers, such as: taste, size, product composition, space, and service.
You will be surprised how honest and enthusiastic customers are when you ask how you can improve your service.
If your business is just starting out, you won’t have many customers to ask. So, “ask” your competitors. Many retailers regularly visit their competitors’ stores to see what and how they are selling.
If you’re really brave, try asking a few customers after they leave the store. What they like and don’t like about competitors’ products and services…
Once you’ve gone through this 3-step process, you need to take the next step, the hardest one: Honesty. What features in your business are what sets you apart? What can you promote so people want to become your customers? How can you highlight the USP to position your business?
Do not give up! A successful business doesn’t necessarily have to have a unique product or service. It’s about how to make your product stand out, unique or how to define and create a USP (Unique Selling Point) – even in a market filled with similar items.