Lecture on how businesses (including service-based firms like real-estate agents) can avoid commoditization by using branding and positioning. Covers product acceptance vs. commodity selection, the need to differentiate as markets mature, brand preference examples (autos, consumer goods), and three positioning strategies: prestige/leadership claims, preemptive association, and brand imagery/emotional associations.
I promise you this is so far from anything that you've ever been to. And now, alright, so products, whenever this talks about products, it's anything a business sells. So it's not that we're selling physical products. Some of the examples are product based companies just because they make for good examples like Apple or Nike or BMW or I think I have a Budweiser example in here too. But it's product. So our product is, it's a service, but same thing. So the first is product acceptance. And this is when a company introduces something new or one of a kind. And I guess there's a few instances, I mean there are companies that are trying to do that in real estate. Like what's a good example of someone trying to do something new? Like I could think of one like Redfin. Maybe they're trying to kind of break the model. I don't know of many others, but most of us aren't in the product acceptance. Like we're not trying to create something new and have the product accept it. Commodity selection. As more and more competing products enter the market, customers begin to see the product service as a commodity. Real estate services in the eyes of the consumer, I think we are viewed as a commodity. Who disagrees with that? Anybody? So does everyone agree with it? Okay, so that's the challenge. So when you're in a commodity market, there really is only one option. And it doesn't mean that you have to be the best or number one. But you've got to think about, you know, when these people come into the fold, what are they going to see? What is the brand? All of you have heard me say that I didn't spend a whole lot of time on branding and business cards and image advertising. But what I meant by it, I mean I had a brand even though I didn't work on it, but I never led with the brand. So a lot of agents come to get in the business that they don't know any better and they're doing image advertising off of the right out of the gate. So as a market matures, you must differentiate yourself, make your product stand out, stand outing, stand out in the minds of your customers in order to thrive. So examples of brand preference, I mean automobiles for the most part, commodity. I mean there's a lot of players in automobile and they generally do the same thing. I mean you turn the key. Most of them safely get you from point A to point B, you know, at least when they're new. But there's big differences. People that are, you know, like I love BMW cars and it's just the feel and of the BMW. But there are people that love Toyota and then people that love the value of Kia, and they all have different brand preferences. So that's our goal here. So very few products, services cannot be branded. Even real estate services that I've become commoditized in the eyes of consumers. So your relative standing in the market. So I think this is where a lot of people can get hung up. So they're like, well, you know what, if I'm not. If I'm competing with a guy that's selling or a girl that's selling 500 homes a year and I'm only selling 50 homes a year, automatically I'm going to be at a disadvantage or whatnot. Not if what you stand for is communicated in your marketing materials and your listing presentation and how you communicate ahead of time with that appointment or whatnot. It doesn't mean that you're out of it. So your general position in the market isn't the only thing you got to worry about. So you have to consider your competition. There are effective positioning strategies for every level. We'll go through those here. Three general positioning strategies to strengthen and shift your relative position. So the first one is prestige identification or leadership position. So you can use this if you make a legitimate claim to being number one in some important respect or attribute of your service. So if you legitimately have a claim to being the best at something, then you can use a prestige identification, preemptive persuasion. I'm trying to think of a real estate example of this one. It's an instant association. This is more like. Like Kleenex. Like, even though you're not picking up a Kleenex, it's just an associate. Like Google. Like Google it. So being that that well known that everyone instantly associates you with real estate, it'll make more sense when I get to it in Legion. But there's ways to do it with aligning yourself with someone else and making sure that the people that like the Minnesota Wild are going to align with you and there's benefit there. And so I'll go through examples of where I aligned with somebody on radio where it was a total mismatch. And the reason I didn't. It wasn't successful is because, like, we have a local station here and the guy's just a goofball and it's nothing. He has a great radio show. But I'm not a goofball, you know, So I align with someone better who's more serious and they can say, you know, you want to. I just had lunch with Lars. And, you know, so we'll go through it. Brand imagery or emotional associations. The key here is to create some sensory image that customers will automatically associate with your product. So you could use versions of this or decide where you want to end up in here, but we'll go through that here. So king of beers, right? Prestige identification. Just huge, massive company. Google preemptive. Instantly, you think of search when you think of Google and then brand imagery. Nike, like everything Nike and all their videos and everything is very sensory. And you can almost feel like when they're running a commercial, you can feel like you're on the track with that person or whatnot.
