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Topic: Strategy

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How To Stand Out In A Saturated Market

Posted by Anonymous on 500 Points
Webhosting - everybody seems to offer webhosting in a very competitive, saturated market; Low prices and great service are not special anymore.

How can a start-up hostingcompany (Great service, competitive prices, hard working people, up-to-date packages, nicely and efficiently designed website) still stand out and sign up as many as 1500 or more clients within 1 year.

What do you think is the most efficient succes formula to hit this target on a low budget?


  • Posted by MonMark Group on Member
    Welcome to KHE

    Low prices and great service get you to the table.
    What is your differentiating factor? Why you?
    Why did you pick 1500?

    What do you believe your closing ratio is?

    IMHO, you are going to have to move away from the computer and get out and meet as many people as possible; convince them that they should leave the relationship they now have and move their business to you.

    Can you do that?

    Why should I, as a customer, do that?

    Let's have some introspection, Dafne.

  • Posted by riddings on Member
    As Randall basically pointed out what benefit do you offer your clients?

    Before spending one dollar on advertising you much know your competitive strength... Recognizing your neutral advantages won't move you up the ladder... You don't need to be as cheap as your nearest competitor to be better... You should survey the top 10% of your client base and ask them what they value from your service... what additional services would they really value...

    Then ask yourself, how much additional would it cost to give them that value... Randall asked you why 1500 customers... This is an important question... If that's your break-even point, it might be better to multiply your price by 4 and need only 400 customers.... Then offer them additional value for that increased price...

    It's difficult and sometimes not necessarily worth while to compete in a price-sensitive market... instead compete for different customers who aren't as price sensitive and offer them an easier package... a better product... a better value...

    Define your demographic carefully... Who are they? Where position do they hold? What do they read? What do they listen to? There are many cross-promotions you can put together that can target people, but you must know your competetive strength and your unique selling proposition.... Why should people do business with you?


  • Posted by MonMark Group on Accepted
    Let me add, that if 1500 is your break-even net, and your closing ratio is as high as 25%, you will have to call on 5000 prospects to break-even.

    That's 15 clients a day, every working day. One less, you're in the red.

    Can we hear your thoughts?
  • Posted by MonMark Group on Member
    Frank, Caring Discussion...

    What does "...answer all the questions in forums" mean?

    Dafne, "...going the extra mile...etc" is not a differentiation. As you may already be aware, clients demands require running shoes. Can you be more explicit?

    "The hosting is part of a network where professionals can market themselves and win projects." Does this statement that you have created something similar to KHE "Post a Project"?


  • Posted by mgoodman on Member

    I think you need to go all the way back to your business plan and overall marketing strategy. Get out the SWOT analysis and review your notes from the interviews you conducted among prospective customers. Then look critically at your positioning statement.

    What is the unique competitive advantage that made you think you had a chance to succeed in this very competitive environment? That should tell you what you have to do. If you never went through that exercise in the beginning, then now is the time to do it.

    The question should not be "How to stand out in a saturated market?" but "Do we bring anything to the party that will make us different from and better than the folks who are out there now?"

    Trying harder and "caring" are not competitive advantages. Everybody claims they do that, and some even do. You need to have a sustainable competitive advantage, or you need to be the low-cost provider and compete on price. (That's not such a great strategy either, but it is certainly an alternative.)

    The fact that you're asking for help standing out in the crowd suggests that perhaps you didn't think the business proposition through enough in the beginning. If that's the case, you can do yourself a HUGE favor by slowing down and laying that foundation now ... before you get too deeply into a de facto business plan that doesn't stand up to close scrutiny.

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