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Colour |
Size |
Production Cost |
Price |
Profit per item |
| Red | Small | $10 | $20 | $10 |
| Blue | Small | $10 | $20 | $10 |
| Green | Small | $10 | $20 | $10 |
| Red | Medium | $20 | $39 | $19 |
| Blue | Medium | $20 | $39 | $19 |
| Green | Medium | $20 | $39 | $19 |
| Red | Large | $30 | $55 | $25 |
| Blue | Large | $30 | $55 | $25 |
| Green | Large | $30 | $55 | $25 |
Company B only offers one product size - medium. They also offer only one colour - blue. The price for company B's product is also $39 but it costs them only $19 to produce it. Which of the above is
- a strength,
- a benefit
- a feature?
The answer depends on what customers actually want.
If customers want the product in various sizes and colours then offering this is a benefit. However as it is likely that this can easily be copied by other companies it cannot usually be called a strength. If the different colours are of no interest to customers who always pick the first item available in the desired size irrespective of colour then product colour is not actually a benefit - but a feature. As there is a cost in producing multiple colours, this could even be viewed as a weakness. Finally, although company B does not have the same range as Company A, it's production costs are lower. If this cannot be copied by company A then this is actually a strength.
In summary,
- A strength is something that one company possesses that cannot easily be copied by competitors. The company has a competitive advantage with the strength.
- A benefit is something that one company possesses that is not offered by competitors, but could be copied if they felt it would be beneficial for them. It does not convey any competitive advantage - but does result in the company gaining customers attracted by the benefit.
- A feature is something that the company offers that has no real benefit to customers, but does add variety to the company's product offering. As such, features that are not wanted by customers (i.e. offer no benefit) are likely to be weaknesses, unless there is no cost involved in producing them.
Make sure, when you look at products that you are clear as to the product strengths, benefits and features - and use this understanding in your marketing planning.
If you liked this tip, why not subscribe to the AWARE Marketing Tips newsletter. This contains more than just the Quick Tip produced on AWARE's Internet site. It contains recommended web-sites, AWARE news and much more. Also, visit the rest of our site for further ideas on competitive and marketing strategy. And if you need to obtain information on your competitors, check out AWARE's services pages to see how we can help you.
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Quick Tip Robert Smith was devastated. As the owner of a small retail business selling various groceries he had always recognised the threat posed by major supermarket chains such as Tesco, Walmart, Carrefour and the like. Now a branch of Tesco had opened next door, and business was tailing off. He told all his friends how worried he was - and that things couldn't possibly be worse. And then a branch of Walmart opened on the other side. Robert now told friends that he expected to be out of business within the year. His friends were really surprised when they met him a few months later - getting out of a top-range Mercedes wearing an expensive suit and with a big smile on his face. Robert replied: Well that is what I thought. And then I remembered that one secret to effective marketing is to make sure that your potential customers know where to find you. So I changed the name of my company. Come and look!" Robert's friends followed him to his shop, sandwiched between Tesco and Walmart. Over the front, the new name was posted in big neon letters ENTRANCE How do you promote your business? Can potential customers find you? Do your marketing promotions send people away, or invite them to come and buy. You need to ensure that all your marketing promotions allow customers to enter. (For more marketing and business humour, visit our humour pages) |