How to Move to a Blue Ocean Strategy
Posted August 29, 2018
5 min read
“Think of it this way: I would rather have a smaller, financially strong business that stands for values and that appeals to a market with the desire and ability to pay, than have a financially stressed, larger business trying to be all things to all people,” says Alan Creedy when we sat down with him to talk about strategic moves that can help funeral homes better compete.
With more than 35 years of experience in funeral service, Alan helps business owners and funeral professionals in the areas of finance, leadership growth, mergers and acquisitions, exit planning, market strategy, and organizational dynamics.
In part two in our blog series, Alan shares how you can start to craft a new value curve and key tips to remember while doing so. (See part one here.)
Where to Start: How to Craft New Value
To start, focus relentlessly on the people who do care. (Be sure you know the factors that they really do care about, too.) “The people who do care are interested in an experience that is a transformation,” adds Alan.
Focus on all the ways you can provide them with differentiated value and provide them with a great experience to honor a loved one. Ask yourself:
- What are services or factors that can be eliminated that I am currently offering?
- What services or factors should I be offering?
- What factors are a result of competing for “low end” customers that I can stop doing?
Here are 3 other key tips to remember if you are looking to narrow your focus to stand out from the competition:
1. Avoid feeling guilty—as much as you can—about “not serving everybody”
Ask yourself: what would happen if you were able to reallocate all your “low end” resources and focus on attracting more desirable (or “high end”) families?
To get there, it has to mean you can’t serve everyone.
So many directors spend so much time, resources, and emotional energy on the segment of the market that doesn’t care about what is being offered to them, says Creedy. Spending so much energy on them comes from the best intentions, but it’s something we can learn to give up.
“We often hope that we can somehow convert those families, or that we can educate them, or convince them of the ‘error of their ways,’” says Alan. “The reality is that, taken to the extreme, we may be chasing pennies in doing so,” he says.
2. Take advantage of every opportunity you can to articulate value
“There is an old saying in the marketing world I adopted years and years ago: ‘When you’re in a market that has become a commodity, the best way to stand out is to let people know what you stand for,’” says Alan.
Part of the solution is your strong, defined focus that sets you apart from the “competition.” Another key aspect is making sure you clearly communicate your differentiating factors to the marketplace.
Look at Southwest Airlines, another company that focused on key, strategic elements to re-position itself as a low-cost carrier with excellent customer service.
Competing in the airline/transportation industry doesn’t come without its challenges thanks to substitutes, intense rivalry, regulation, and other factors.
Southwest re-oriented its strategic focus from competitors to alternatives. Specifically, they knew they could be another option for families who were using cars when traveling. In doing so, Southwest was able to set its sights on competing outside its own industry.
Southwest was then able to articulate its focus as a true, low-cost alternative that would deliver “fun” to customers.
The concept was simple. And their (previous) taglines told the story succinctly, which helped customers to know exactly what to expect with Southwest: “Southwest Airlines. THE Low Fare Airline” and, “How do we love you? Let us count the ways…”
It’s an example of how when you communicate your strategy effectively, you can find excellent success. “Unfortunately, research has shown that people think all funeral directors are the same,” says Alan. “If that were to be the case, the single best strategy is to let people know what you stand for. Take everything as an opportunity to communicate what you do and why you do it best,” he argues.
3. Stay courageous
Everyone knows you can’t be all things to all people, but it takes courage to not stray from that idea on a day-to-day basis. It can be very challenging to do what feels like “turning away” families or to take steps towards an untapped, entirely new market.
Remind yourself that when you narrow your focus, you can broaden your market and you can better serve your most desirable families, explains Alan.
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