Page 99 - Business Plans that Work A Guide for Small Business

90 • Business Plans that Work

to be an extension of your personality. So, based upon your economic
means and self-perception, you buy a 1965 Ford Mustang Convertible
because of the emotional benefits you derive. Within every product space,
there is room for products at different points along the continuum. Entre-
preneurs need to decide where their product fits (or where they would like
to position it) as this influences the other aspects of the marketing plan.
Lazybones, for instance, tends toward the emotional side of the con-
tinuum. Parents could insist that their children do their own laundry. It
would be more economical, but parents want to ease their child’s transi-
tion to college and insure that their child dresses presentably. Thus La-
zybones is counting on parents making an emotional decision; therefore,
their marketing plan will tug on those sentiments.

Figure 6.2
Lazybones

Rational Emotional

Product/Service Strategy

Building from the target market definition, this section of the plan
describes how your product is differentiated from that of the competi-
tion. It’s informative to look back on the competitive dimensions you
described in the competitive profile matrix. What attributes are impor-
tant to the customers? Are they willing to pay a premium for those fea-
tures? Will they continue to pay a premium for those features? One of
the biggest mistakes entrepreneurs make is evaluating an opportunity
as if it were static. But marketplaces change; customer values change.
Think about cell phones; in the early years people paid huge premiums
for the hardware and the minutes. As the product became more widely
dispersed, price became an ever increasingly important attribute. Wire-
less companies began giving away the hardware and enticing customers
with great calling plans. They try to make up for the lost revenue through
data plans, but as smartphones proliferate, expect those rates to decrease
too. The point is that if you had entered the market early and viewed it
in a static fashion, falling prices would have caught you by surprise and
potentially led to your firm’s demise. So, as you think about your product/