Strategic Sales Planning - 1

Day 3

Define USPs and Value Propositions, Identifying Market Segments and Market Potential,
Identifying High Potential Markets and Segments

Welcome everyone, to another session packed with essential knowledge and interesting facts
about sales. Today we shall explore certain key elements and processes related to Strategic
Sales Planning.

To start with, imagine an organisation that does not have a well-defined sales strategy and
objectives. What happens?

Without a sales strategy plan in place, sales representatives and directors make decisions
based on what is in front of them at that given time. Not because they’re careless or foolish,
rather they are unaware of the company’s long-term goals. As a result, it becomes challenging
to tie sales activity to specific data-backed objectives.

So, to create dependable, long-lasting growth throughout the business, sales representatives
need a strategy. And that starts with a solid sales strategy plan.

Now let’s understand what exactly is a sales strategy plan?

A sales strategy plan is a company’s roadmap for securing dependable, long-term revenue
through the retention and acquisition of new and existing customers.

They typically encompass everything from specific tactics, market strategy, processes,
objectives, forecasting, budgeting, and timeline.

But before we move onto such detailed planning, we must understand certain key elements that
form the base of our plans.

Value proposition
Your business’s value proposition is arguably the most important element of your overall
marketing messaging. But what exactly is the value proposition?
A value proposition tells prospects why they should do business with you rather than your
competitors, and highlights the benefits of your products and services.
Unfortunately, many businesses either bury their value proposition in buzzwords or trite,
meaningless slogans or don’t bother highlighting it on their site and in their marketing
campaigns – or they don’t figure out what it is at all!

For better understanding, let’s take a look at the Apple iPhone where the Experience is the
Product

Even in today’s oversaturated consumer electronics marketplace, it’s hard to imagine a more
iconic product than the Apple iPhone. It’s also difficult to imagine a product with as much
competition as Apple’s flagship mobile device, so what sets the iPhone apart from the hundreds
of competing devices on the market?

As you’d probably expect from Apple, a firm renowned as much for its commitment to sleek,
elegant product design as its actual products, Apple firmly reiterates its value proposition about
its iPhone range of products – specifically, the design of the device itself, the ease of use that
has been a cornerstone of Apple’s design aesthetic since the launch of iOS, and the aspirational
qualities that an iPhone supposedly offers the user.

Apple knows how crowded and competitive the smart device market is, so rather than focus on
a specific feature – virtually none of which are unique to the iPhone or iOS – the company
instead opts to focus on the experience of using an iPhone. Most companies couldn’t pull off
using words such as “magical” to describe using a smartphone, but Apple can.

Of course, Apple doesn’t just sit on its proverbial laurels and rely on aspirational messaging to
sell you on its value proposition. The official iPhone site also touches on several of the
genuinely unique features of iPhone and iOS to make its case, including security.

So then what exactly is Apple’s value proposition? We must note that it’s value proposition has
evolved over time. Right from “think different” to “tech that works” to “your privacy is safe with
us”. Apple and its offerings have always kept pace with the changing environment and today
with the growing concerns around security and privacy, they want to create a safe, reassuring
ecosystem that makes users want to remain part of it.

So today, Apple’s most recent value proposition seemed to be geared towards privacy
protection and being part of a safe ecosystem.

USP

I am sure most of us know what USP is? However for those who don't know USP. USP
stands for Unique Selling Points.
Let's Take a moment to answer this: What distinguishes your product from similar products in
the market?

You probably had several things come to mind; maybe your product is integrated, easy to use
and versatile enough that it has many possible applications across a number of industries.

But providing a long-winded list of every feature and potential benefit of your product is a poor
selling technique. Instead, consider forming a unique selling proposition or USP.

A USP is a succinct statement of what your product or service does, how it solves for the
customer’s challenge and why it’s better than other options in the market. By zeroing in on the
one unique feature, benefit or use of your product, you can focus your sales and marketing
strategies for a more targeted approach.

Pinpointing your USP requires some hard soul-searching and creativity. One way to start is to
analyze how other companies use their USPs to their advantage. This requires careful analysis
of other companies' ads and marketing messages. If you analyze what they say they sell, not
just their product or service characteristics, you can learn a great deal about how companies
distinguish themselves from competitors.

Let’s consider the toothpaste market. Take a moment to think about your preferred toothpaste.
Despite the presence of numerous brands and variants, what is it that draws you to this
particular toothpaste?

Is it because your toothpaste caters to sensitive teeth or because it fights cavities? Or simply
because you like the taste? There can be numerous reasons and each brand has built a specific
place for itself in the market using a USP.

Take a look at the USPs of some leading toothpaste brands and understand their positioning:

Colgate is the number 1 toothpaste brand recommended by dentists

Pepsodent is a 15 year old brand that offers various oral care solutions to specific need based
solutions.
Close Up is synonymous with 'Freshness' that gives a confidence to get close to someone you
love.
Sensodyne helps relieves the sensitive teeth problems ( again recommended by doctors for
sensitivity )
Dabur Babool contains ayurvedic ingredients and medicinal benefits

Now that you know what a USP is, note the features of a good USP-

- Assertive, but defensible: A specific position that forces you to make a case against
competing products is more memorable than a generic stance, like “we sell high-quality
products.”
 - Focused on what your customers value: “Unique” won’t count for much if it’s not
something your target customers truly care about.
- More than a slogan: While a slogan is one way your USP can be communicated, it’s also
something that you can embody in other areas of your business, from your return policy
to your supply chain. You should be able to talk and walk the walk.

It’s not necessarily what you sell that has to be unique, but the message you choose to focus on
that your competition doesn't. A solution which is directly linked with a problematic statement.

Market Segmentation

When trying to reach customers with a marketing message or ad campaign, targeting the right
market with the right message is essential — If you aim too broadly, your message might reach
a few people who end up becoming customers, but you’ll also reach a lot of people who aren’t
interested in your products or services. When your messaging isn’t optimized for your audience,
you’ll end up wasting a lot of resources.

So how can one overcome this problem?

Yes you are right! Through segmentation.

Market segmentation can help you to target just the people most likely to become satisfied
customers of your company or enthusiastic consumers of your content. To segment a market,
you split it up into groups that have similar characteristics. You can base a segment on one or
more qualities. Splitting up an audience in this way allows for more precisely targeted marketing
and personalized content.

The four bases of market segmentation are:

1. Demographic segmentation
2. Psychographic segmentation
3. Behavioral segmentation
4. Geographic segmentation

Now let’s look further into each of these segments and classify their customers using multiple
sub-categories.

Demographic Segmentation

Demographic segmentation is one of the most popular and commonly used types of market
segmentation. It refers to statistical data about a group of people.

Customers are targeted on the bases of their

-Age
-Gender
-Income
-Marital Status
-Location
-Annual Income
-Education
-Ethnicity

Because of the statistical and factual nature of demographic information, it is usually relatively
easily available and most often used for market research.

A simple example of demographic segmentation could be a vehicle manufacturer that sells a

luxury car brand, say BMW. This company would likely target an audience that has a higher
income. It wouldn't make sense for BMW to put up a billboard about the launch of a new model
in a tier 2 or tier 3 city because few people in these cities would be able to afford such luxury
cars. Instead, a billboard in South Delhi or South Bombay or at a place where people have the
buying capacity. It would be beneficial in attracting the customers who might actually be
interested in purchasing the product.

Next comes,Psychographic Segmentation

Psychographic segmentation categorizes audiences and customers by factors that relate to

their personalities and characteristics.
● Personality traits
● Values
● Attitudes
● Interests
● Lifestyles
● Psychological influences
● Subconscious and conscious beliefs
● Motivations
● Priorities

These factors are often subjective and vary greatly from person to person and thus difficult to
identify. They are not data-focused and require research to uncover and understand.

For example, a company that focuses on sustainable practices and eco-friendly products needs
to target customers who are concerned about the environment.

Can you think of some real life examples where psychographic segmentation is used?

Behavioral Segmentation
While demographic and psychographic segmentation focus on who a customer is, behavioral
segmentation focuses on how the customer acts.

● Purchasing habits
● Spending habits
● User status
● Brand interactions

Behavioral segmentation focuses on the actions and interactions of the customer with a brand
and uses these observations to sell more to them.

A fashion retail company may choose to target customers who often shop with them during the
wedding season with an exclusive wedding collection.

Geographic Segmentation
Geographic segmentation is the simplest type of market segmentation. It categorizes customers
based on geographic borders.

● ZIP code
● City
● Country
● Radius around a certain location
● Climate
● Urban or rural

Such segmentation can be observed with certain FMCG brands that target the rural sector
exclusively and others who only sell in the urban areas.

Identifying high potential Markets and Segments

Once you have identified relevant segments, the next step should be investing enough into each
segment to procure meaningful data on performance.

But how do you know if you’ve considered the correct segments? There are four useful
characteristics that will help you measure the viability of choosing a particular segment.

● Measurability – First and foremost, the segment itself should be easily measured. This
means that information is available on the overall market potential (size of the market),
as well as the competitive position of the companies competing for market share.
● Accessibility – Firms must also be able to communicate directly with key consumers in
order to understand their core segment and tell the brand story.
● Sustainability – Overall profitability must be proven in a given segment in order to
successfully do business. Long-term potential sustainability can be measured based on
 past consumer behavior coupled with the organizational ability to produce products at
the right price.
● Actionability – Finally, the firm should be able to produce a competitive advantage within
this particular segment. There should be actionable opportunities for the organization to
build a strong and differentiated position within the segment.

If each of these attributes give you a positive signal, you can move ahead with other relevant
decisions like pricing and promotion and concentrated marketing efforts to make your products
and services more appealing to the selected segments.