If you are a golf player or interested in the game, you would know what is meant by ‘sweet spot’. It’s that favoured spot on the club face. You hit the sweet spot and you’re in control of the ball. That birdie is now yours for the taking. If you don’t hit that spot, you spend your time hacking in the rough and before you know it, you’re in a bad patch.
In business terms, the sweet spot is where your target customers’ needs fit with what’s special about your product or service. The proverbial 80:20 rule applies to growing companies: 20 percent of customers deliver 80 percent of the profit. That 20 percent is the sweet spot. To make growth happen, you have to focus energy on finding your sweet spot. It will provide the clarity, focus and alignment that will help your company grow.
If you rush to execute, before making the right sweet spot decisions, you will waste time and valuable resources on the wrong customers. Like a golfer continually hacking out in the rough, you will expend a lot of energy but make little or no progress.
Customers outside the sweet spot inhibit growth and should be considered off-strategy. No company has products or services that appeal to all. You need to concentrate on those customers whose needs match the unique value you offer. Winning companies know their sweet spot customers intimately and continuously deliver better value than the competition. Their marketing becomes tailored to that sweet spot – customers almost see themselves and self-select.
A great example of a company that knows its sweet spot is American consumer electronics company, Best Buy. Competing in a fiercely competitive market, Best Buy stays focused on its sweet spot: 18-32-year-old male gadget freaks, audiophiles and big-screen addicts, who come to salivate over the newest electronic toys. Best Buy delivers a great shopper experience: no pushy sales folks but lots of cool items for shoppers to play with, even if they can’t afford them right now.
Like golf, finding the sweet spot is a continual battle. Sales, marketing and production are continually pulling in different directions. Companies that succeed have an agreed process and discipline, driven by the CEO, to figure out their sweet spot.
Let us go into little more details about sweet spot. The first question any entrepreneur would ask on and off during the business cycle is - Where should we position our brand? Although this is a straightforward marketing question, finding the right answer can appear complex. At the same time, in an increasingly competitive marketplace, finding the right answer has never been more important. Companies face the challenge every day of developing a winning positioning that will solidify their place in the market, set the direction for their marketing and sales and drive the growth needed to succeed.
A winning positioning should be one that is relevant to the target audience and differentiated from the competition. So how do we determine that and how do we do it well?
The sweet spot is the answer. We have to find the sweet spot of competitive positioning.
If you look from a different angle, the sweet spot is where there is alignment across three key dimensions: (1) Importance of a feature or benefit to the target market. (2) High performance on that feature or benefit by your brand/product and (3) weaker position by your major competitors on that feature/benefit.
We will discuss each of the above dimensions as well as some ways to identify them and therefore, find the sweet spot.
Importance to the market
Finding the sweet spot of competitive positioning necessitates determining what features or benefits are most important to the market. There are a number of approaches to determining attribute importance, from straightforward rating or ranking questions (which may not differentiate much between attributes), to more elegant approaches, to more complex approaches.
High brand performance
What is your brand really good at? On which features does the market recognize that it really excels? Now, which of those are the important ones? If you know that you excel in a certain area, either through independent tests, customer feedback, etc., and that attribute is important, you want to be sure the market hears about it, especially if it’s an attribute where your competition is weak. Brand performance can be determined by comparing your brand’s performance on various attributes vs. your competition. Both straightforward questions as well as the perceptual mapping technique, which gives a graphic snapshot of the competitive landscape, can achieve this.
Weak competitive performance
You want to own your positioning. Volvo owns safety. Google owns search. What do you own? What can you own? It’s not a winning positioning if your competitors match or exceed your brand performance in the
Look for differentiation among perceptions of your brand and your competitors’ or determine how to create differentiation on an attribute that matters to your market. You want a point of difference that is believable
These three dimensions identified above will help you find your sweet spot, as well as those who are off-strategy: Discipline is required to avoid the temptation of taking on customers that do not meet your sweet spot. Time spent on solutions for off strategy customers robs you of resources better spent focusing on opportunities within your sweet spot. However, opportunities outside your sweet spot will always arise and while in an ideal world you would say no, sometimes, usually for cash reasons, you need to say yes. Tactics we would suggest to minimize the impact include:
Keep investing in your sweet spot and build a strong sales pipeline that gives you the confidence to say no more often to opportunities outside your sweet spot;
As a respected CEO, said: “A good portion of our success was due to all the deals we didn’t do.”
Sphere of authority
How do you find your sweet spot? Well, you know when you’re in your sweet spot when:
Some marketers try to chase whatever is new out there or to hop on to an issue that is important to the target audience but not in the brand’s sphere of authority. This is bound to backfire.
(Lionel Wijesiri is a retired corporate director counting three decades of senior management experience. He is now an independent consultant and a freelance journalist. He may be contacted on [email protected])
Add commentComments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.
Sri Lanka is presently experiencing a tremendous economic crisis. Several k
With the increase in egg prices the government decided to import eggs to regu
In order to critically discuss a movement, we must first understand its etymo
Many battles were fought during the long war between the Sri Lankan armed for
31 Mar 2023 - 6 - 1415
29 Mar 2023 - 2 - 1032
28 Mar 2023 - 8 - 1057
24 Mar 2023 - 1 - 1415
31 Mar 2023
31 Mar 2023
31 Mar 2023
Name - Reply Comment