I was driving down the street in my neighborhood on a recent sunny Saturday when I spotted an odd sight. Two groups of neighborhood kids had set up lemonade stands on opposing sides of the street, each group waving vigorously at me as I cruised past.
I thought to myself I’d never seen that before, so I slowly rounded the block and proceeded to check out the two pop-up lemonade storefronts more carefully.
After a few questions, I learned they considered each other a fierce competitor and were trying to out sell one another using any means possible.[jetpack_subscription_form title="Subscribe to Out of Office:" subscribe_button="Sign Me Up"]
I proceeded to negotiate and soon found myself the owner of four cups of lemonade for the price of five cents. Seeing this, the other group offered to give me twice as much and to mow my lawn for free.
Now, before you think me a heartless lemonade stand dream killer let me assure you I gave each group a dollar and passed on all of the warm, sugary liquid they tried to foist upon me.
Of course, since I’m given to turning just about every situation into a marketing lesson, it struck me the mistakes made by these youthful sellers are also frequently the downfall of their grown up business counterparts.
So here are the commonalities between the modern-day lemonade stand and the average small business owner:
Branding defines the offer
Far too often, branding elements take a back seat to pushing a product or service out the door. When it comes to
choosing one product or company over another, branding has far greater impact than most business owners
You can spend a lot of money on meaningless “branding” videos and packaging, but the real trick is positively positioning your business in marketing materials, providing customers value through timely offers, and product innovation, especially with a market saturated product (like lemonade).
Cheap pricing often backfires
Lemonade is cheap, it’s a commodity really, particularly in a world where we’ve grown accustomed to grocery shelves lined with some 85 different kinds of lemonade.
When you create and define a product that can only be judged on price, you create a recipe for business failure. Just as my young sellers demonstrated, there will always be someone else willing to deliver more to their customer.
Location matters more when the offer isn’t unique
It used to be location was everything. Today, offering something that gets people talking about you and your
business is the new “killer location” and you can do it from anywhere if you do it right.
Location is expensive. Setting up shop in a busy mall or in a hoity-toity neighborhood costs more than setting up an online storefront. What costs even less is marketing your business so well, wherever the location, your customers don’t mind traveling a little bit farther or going out of the way to get your product or service.
Don’t hire your friends
Later in the day I drove back past my lemonade friends. One stand was completely abandoned while the other was manned by a lone clerk. I asked her where everyone went and she told me, ‘’they got tired of working and went home.”
Who you hire matters and quite often being friends isn’t enough.
Here’s a tip: Focus on building a strong brand, one that helps communicate what you believe in and you’ll more easily attract people who share your passion and values.
Every business is really a marketing business
So, I guess it’s no surprise I’ve brought it all back around to marketing, but the truth is no matter how great your product is, and it must be great, unless you can tell a story that allows people to see a better future for themselves by acquiring your product or hiring you for your services, you’ll struggle to gain long-term profits no matter how grand your plan is in the beginning.
John Jantsch is a marketing consultant, speaker and author of Duct Tape Marketing, Duct Tape Selling, The Commitment Engine and The Referral Engine and the founder of the Duct Tape Marketing Consultant Network.