As you review John’s Market Profile sheet in Exhibit 6-9 on page 182, you can see that John’s product, the XLX 9000, has no unique strengths. Yet, John knows that his strongest features, sold collectively, can produce more value than those of competitors—if he can make them measurable. He also knows that in the replacement market he must use a SOE that can offset the costs of doing nothing (replacing an old water heater that still works for a so-called new and better one). His challenge is to find market segments whose goals can be achieved by those features.
Market Segment: Replacement opportunities
Market Segment Location: Homes on Elm, Oak, and Pine Streets
Position: Owner, not renter
Organizational Characteristics: Homeowners, houses built before 1971, greater than 2,200 square feet, family of five people or more a higher priority
Previous Success Stories: More than 25 houses on these streets
Homeowner’s Goals
Homeowner’s Benefits
Systems of Evaluation
XLX 9000 Features/Benefits
Unique Strengths
Reduce energy usage
Saves money
Kilowatts or therms (gas) used per BTU
High efficiency rating (lowers electrical or gas consumption)
No (MV)
Improve efficiency
Reduces reheat time
Minutes per reheat
Fast heat transfer (decreases downtime between showers)
No (MV)
Increases supply of hot water
Gallons of available hot water
Large water tank (stores more hot water than standard tanks
No (MV)
Improve reliability
Minimizes inconvenience of no hot water
Number of moving parts
Solid-state design (reduces number of moving parts)
No (PV)
Reduce maintenance
Lowers repairs and maintenance costs
Unscheduled repair costs
5-year parts and labor warranty
No (PV)
Exhibit 6-9: Market profile sheet.
John identified Water Heater Replacement Opportunities as a market segment. He developed a modified-for-consumers Market Profile sheet for it by defining its organizational characteristics (in italics). His marketing logic for defining this market segment is as follows:
Homeowners. Renters are not interested in making investments in assets they do not own.
2,200-Square-Foot or Larger Houses. Larger homes usually house larger families. In addition, larger homes require larger water heaters and have higher utility costs to justify a reasonable payback (if necessary).
Built Before 1971. Oil embargoes were not in vogue yet, and therefore energy efficiency was not a major concern for American homeowners.
Families with Five or More Members. They require lots of hot water. (See Exhibit 6-9.)
As you review his Market Profile sheet, notice how the four organizational characteristics produce goals that match his features. How far you need to segment markets depends on the point at which you can link your strongest feature or unique strength. Sometimes, you need to consider your unique strengths at the company level not, just at the product level.
Thinking in terms of organizational characteristics, John also knows there are other reasons why people might increase their water-heating requirements. For instance, when people purchase Jacuzzis, they often increase their hot water requirements. Therefore, John would create a market segment for Jacuzzi owners. He might even want to offer Jacuzzi companies a commission on every sale that results from a lead they give him.
Note To simplify the case study, there is only one decision maker and only one of John’s products, the XLX 9000, can satisfy Brian Walters’s goals. In your selling situations, numerous products might help customers achieve their goals. The only requirement is that their features connect to the stated goals. In addition, all the benefits are internal because consumers do not have customers.
MP 1: Spark Interest
The following steps make up MP 1: Spark Interest.
Step One: Research and Membership
John: Good evening, Mr. Walters. This is John Peters with Water Heaters Inc. I’m calling you because of our successes in helping your neighbors with their water-heating requirements. We achieve our best results in 2,200-square-foot or larger homes built before 1971 that still use their original water heaters. Real estate records indicate your home falls into those categories; is that correct? (The only yes-or-no question John asks. He needs to verify that Mr. Walters shares these organizational characteristics. If Mr. Walters does, he gets to start with a positive customer response, a yes. Don’t worry; he has used up only twenty seconds.)
Brian: Yeah, That’s right. But, my water heater still works just fine. (He confirms that it is the original one.)
Step Two: Take Your Pick
John: Well, Mr. Walters, regardless of how well your water heater works, if it’s still the original one, we might be able to help you reduce your electrical or gas bill costs significantly while greatly increasing your hot water capacity. Are these goals that you’d like to pursue, or are there other ones that might be more important to you? (John suggests two broad goals that reflect Mr. Walters’s organizational characteristics and potentially connect to John’s XLX 9000 features. John also asks a clarifying question.)
Step Three: Track Record
Brian: Well I actually haven’t given my water heater a lot of thought other than when it doesn’t work, I get it fixed. However, you got my interest, so keep going. (John receives his first customer confirmation and some indication that Mr. Walters has had problems with his water heater in the past. He will explore that issue in MP 2: Measure Potential.)
John: Mr. Walters, judging by our results in the Justinville area, we might be able to achieve the same results with your home. Their homes are similar in size and age as yours. In more than twenty-five Justinville homes that still had the original water heaters we averaged 38 percent energy savings while increasing capacity by an average of 40 percent during the last year. (John validates his proven performance in the same market segment.)
MPC 1: Interest Confirmed
John: However, Mr. Walters, do you feel it’s worth pursuing these opportunities to lower your utility costs and increase capacity? I would welcome the opportunity to see whether you can achieve the same improvements at your home that others achieved in similar situations. (John indicates that he and Mr. Walters will need to make an investment of time. He uses a yes-or-no question to verify that there is customer agreement.)
Brian: I’m willing to find out. (John receives a confirmed customer’s agreement.)
John: Well, thanks for your time. Can we meet next Thursday if that’s convenient for you? It will take about a half hour. (John’s call for action is a meeting to conduct MP 2. In addition, because this is a telephone call, he lets Mr. Walters know how long a meeting would take. He makes sure he schedules the meeting before concluding the call.)
Brian: Thursday is good; see you then. (John receives MPC 1: Interest Confirmed to end MP 1.)
Note Of course, sometimes sales calls do not go as planned (Chapter 8 examines this topic in detail). However, like everything else in the MeasureMax selling system, if you can find your way back to the customers’ goals, you can get back on track. Suppose our Mr. Walters cut John short and said, “What are you selling, John?” All John would have to say is the truth. His reply would resemble this goal statement: “Hopefully, cost-justified reliability, improved efficiency, increased capacity, and utility savings in the form of a water heater. I will need to get more information, though, to determine if we can achieve the same success with you that we have had with similar customers.”
Again, the reason to meet is to see what the unique circumstances of Mr. Walters’ filters are and the measurable benefits these goals can produce. John can proceed to the second phase after obtaining MPC 1: Interest Confirmed.
MP 2: Measure Potential
The case study continues with the second phase of MP 2: Measure Potential. It begins with John meeting Mr. Walters for the first time at his house. The italics in parentheses will reference the active listening and questioning skills discussed in Chapter 5. Please note how John uses Mr. Walters’s responses to acknowledge that he understands his comments. Active listening also gives John time to formulate his follow-up comments and questions. He uses these to reinforce the goals and gather the specifics of the measurable benefits, filters, and systems of evaluations.
Step One: Market Focus
John: Hi, Mr. Walters, John Peters with Water Heaters Inc. Thanks for taking the time to meet with me. As promised, I’ll only be about thirty minutes. (John builds an initial trust level by committing to honor his telephone promise about the length of the meeting.)
Brian: Please, John. Call me Brian.
John: OK, Brian. Thanks. I’d like to point out before we start that Water Heaters Inc. has been serving single-family homes’ water-heating requirements for over fifty years. Our special emphasis is on homes built before 1971. I’m in my tenth year with the company and have worked successfully with over eight hundred homeowners. (John establishes his and his company’s credibility.)
Brian: That’s a lot of homes!
John: And a lot of good references. (John acknowledges Brian’s comments.)
Step Two: Purpose and Goals
Brian: Well, John. How do you think you can help us? (Brian is ready to discuss business.)