2006 Summer/Fall Volume 6 No. 2
How to Build and Protect Market Share
By Mike Adams
Market share is defined as the portion of the local market that you can claim as your customers. It is becoming a precious commodity in the portable restroom business, especially in areas where there is a lot of competition. In many regions today, relatively few new customers come into an area. Instead a new customer for you is some other company’s former customer, and when you lose a customer, someone else picks them up.
So, how do you protect what’s yours? And how do you attract good customers away from your competition? Those are the big questions that you may be struggling with; however, you are not alone. Nearly every marketer in every industry in America struggles with the same issues on a daily basis.
The biggest enemy to protecting your market share is customer indifference. That’s when customers take a “you’ve seen one, you’ve seen ‘em all” attitude to restroom service. When restroom services become a commodity, then the only thing that matters to buyers is the price. In a market like that, everybody loses, because the only way to win a new customer is to cut prices or reduce the level of service provided.
We know that there are operators out there who think price cutting is the answer; however, we don’t believe they will “win” market share in the long run. If price cutting were the right answer, you would see it in every industry. Ask yourself how cell phone companies do it, how fast food companies do it, how soft drink or beer companies do it? What about breakfast cereals, rental cars, and airlines?
Other than the occasional “special”, when was the last time you saw the price of Coke or Pepsi come down? Price cutting inevitably leads to quality cutting because “something’s gotta give.” While a customer may initially jump at a lower price, no end customer we have ever spoken with would prefer a “less clean” restroom to save a few dollars.
If you need to build market share, the first places to look are price, service quality, and product comfort.
How do you set price?
In some markets nearly everyone is the same price, in other markets there are definitely high-priced alternatives and low-priced alternatives. Where does your price come in? How does it compare to your most successful competitor?
How does it compare to your least successful competitor?
In most markets, the higher price is generally the territory of the most successful companies. The lowest price is often the territory of the least successful competitor. Ask yourself where you want to be.
Price is a large part of your image. Most people unconsciously equate price with quality. That’s one reason why they will pay more for a brand name product than for a generic one. Do you remember when grocery stores used to have the “generic aisle” where products would be packaged in white boxes with black type? You don’t see these anymore because the products didn’t sell. A generic box of rice is the same product as the Uncle Ben’s Rice in the next aisle, but shoppers will buy the brand name 4 to 1 over the no name package, even when the brand name costs thirty percent more!
In the portable restroom business, as in others, pricing with the quality leaders is important. The other secret is to become a “brand name”.
How do you assure service quality?
This comes down to management systems and organization. You need to start by setting high goals for the employees. Then you need to create a system of checks and balances that makes sure your goals and expectations are met by all your employees all the time. Tools like a ten-point service quality check list, well organized routes, and frequent communication with employees can help build a high-performance service team.
Over-used restrooms are probably the biggest service problem in our industry. The only way to solve the problem is to communicate with the customer. They may need additional service or service at a different time. A service site may have greater numbers of users on certain days, fewer the rest of the week. For example, a public park may be crowded on weekends, but little used during the week. If service doesn’t come until Friday, it will be in bad shape, sitting full all week. Meeting regularly with your route drivers will help you identify customers that are under serviced.
A home-building site may have four carpenters on the job on a daily basis, but have a team of ten roofers come in for two days. If the service technician is unaware of this sudden influx of workers, he or she can’t address the problem. The restroom could be in really bad shape if a special service call isn’t made. In situations like these the customer will be unhappy even if it’s their fault. The only way to keep service levels up to par is to get to know the customer and how the restrooms are used. Occasional service calls from management just to ask “how are we doing?” is also a great way to keep lines of communication open with the customers.
How do you assure product comfort?
Comfort comes first from service—a clean, nicely scented, sanitary restroom is what everyone wants. Additionally, the best service companies have a low tolerance for restrooms with stained floors, graffiti, broken parts, cracked corners, or other flaws. Ancient fiberglass units often have permanent smells soaked deep within the material that cannot be cleaned. Take the time to make visual inspections of units personally.
Naturally, PolyJohn believes we have the most comfortable units on the market.
We think our smooth interior surfaces and larger interior space contributes to end-user comfort. However, whichever manufacturer you buy from, it is important to start with quality and stay with quality. Smaller, cheaper, breakable units are just another example of low-priced compet-itors bringing the whole market down. If you do the math, you’ll find that the restroom unit is a very small fraction of the total cost of service, but it represents most of what your customer experiences. It is worth investing in the best.
Look carefully at the little things.
Once service, comfort and quality are under control, look at the little things that make a big difference to customers. Personal attention, communication, follow up, and thank yous cost little but make a big difference to customers. How your company handles complaints or special requests can make the difference between winning a loyal customer or making the customer indifferent to your company.
Keep in mind, you are not renting restrooms, but rather you are solving customer problems. You are the sanitation provider for their business and as such, you are a partner in their enterprise. While you may have to negotiate with them on price or send out stern letters to get them to pay on time, you should never feel like an adversary of the customer. When they call in the middle of the night to ask you to clean up a tip over, it is hard not to see the customer as a nag who is interrupting your sleep. However difficult the relationship may be at the moment, remember that every customer problem is an opportunity to prove your value to them. The most important service you offer is a relationship of total trust.
Become a Brand Name.
What are the positive attributes of great brand names? For example, what does Starbuck’s Coffee mean? What does Campbell’s Soup mean? What does Ford Truck mean? Miller Lite? Hilton? Nike? NASCAR? These are all famous brand names that have strong meaning to Americans. The meaning is helped by advertising, but it isn’t created entirely that way. The meaning in a brand is generated by every idea the name suggests as well as every experience and memory a customer has ever had with the product.
If your company is well known in your market, then you already have a brand name. Is your brand name helping you? What do people think of when they think about your company? Are you creating the first impression that you want to make? While it may be too late to change your name (customers wouldn’t be able to find you!), it’s never too late to improve your brand image.
For example, Tidy John is a great brand name. It is a friendly sounding name that implies the main benefit of service is “tidiness.” However, no matter what your company name is, you can improve it with a great slogan, a great logo, and an identity campaign that makes your company stand out from the crowd. Think of Campbell’s Soup—not necessarily a catchy name; how-ever, everyone knows they are “mmm, mmm good!”
What do people think about when they think about your company? Is it great service? Superior quality and comfort? Or, something less desirable? What can you do to improve your company while also improving its image? What can you say about your company that helps remind customers of your core strengths in the market?
Avoid a “me too” approach. Developing a brand that sounds like your competitor will only hurt you in the long run. You need a business strategy that clearly differentiates your business in a positive manner from the competition while strongly addressing an unmet customer need. This can be the most difficult step, but unless it is met, success is doubtful.
Finally, while market share may be an important measuring stick for your business, it isn’t necessarily the most important. Many business owners don’t want to be the biggest in their community. They just want to have a strong company that is profitable for their family and their employees. All the tips discussed in this article will help ensure that you can protect the proportion of market share that is important to you.
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