When Domino’s built their company on the promise of delivering pizza in 30 minutes or it’s free, they demonstrated perfectly how a company’s offer is different from their product.
They made no promises about the pizza itself except that it would be hot, and instead made a promise about how and when they could get the product to you (a promise that set them apart and that made their offer more valuable).
Product vs Offer
Your product or service is the part you’re legally obliged to deliver when you get paid.
But every product needs to be shopped for, bought, received, used, disposed of, and (ideally) re-ordered by the customer, and all this occurs within the complexity of a person’s daily life. The value you provide to your customer depends on the sum of these parts. This is “what you offer”.
It’s the full package that your product comes in.
The offer is the key to standing apart from your competitors, innovation in your market, and making a superior offer. But first we need to train ourselves to see all the parts of an offer.
The elements of an offer
- PRODUCT AND PRICE
- Your product or service
- RISK REDUCTION
Returns Policy / Cooling off
- Your range
- Ordering process
Skip the queue
Payment options and surcharges
- Delivery (time, cost, method)
Ease and cost of maintenance
- Disposal issues
Environmental impact (biodegradable, reusable)
- Ease and cost of re-ordering
- Social impact
Vegan/gluten free options
Your offer extends from the shopping experience, to ordering, to payment, to delivery, to the way you collect and access and use the product or service. There are many reasons people buy from you aside from your product and price.
Take-aways (no pun intended)
The product itself is a smaller part of your offer than you think.
Even if you think you offer BBQ chickens, your actual offer includes an extensive list of elements that are tied to real world facts. It includes how many parking spots you have, how long it takes a customer to get their meal, what range of drinks you sell, how comfortable your chairs are, whether you offer home delivery, how healthy or unhealthy your food is, how friendly your staff are, your prices, how crispy your chips are, whether you take eftpos, and so on.
These are all opportunities to raise the value of what you offer in your customer’s eyes.
Successful companies invariably make an offer that extends well beyond their core product.
- Opening hours – Snap fitness found a way to offer customers more convenience AND cut staff costs.
- Bonuses – late night TV infomercials have made billions from offering so many bonuses the main product didn’t even matter.
- Ordering process – Uber’s core offer is still the same as a taxi (get you from A to B), but they’ve made the ordering process easy and transparent, removing much of the hassle of ordering and waiting for a taxi.
- Social impact – Charity Water – it’s still just water, but it’s also an easy way to make a donation.
- Environmental impact – Tesla have made waves by leading in this one area.
- Finance – Harvey Norman sell a lot more stuff when they offer 5 years interest free loans.
Masters of the offer
The world’s most successful companies are masters of making an offer that cannot be matched.
McDonalds innovate in areas of speed, uniformity, and convenience, to make an offer that’s difficult to match. They also lead the field in every location in “easy to find”, by making absolutely certain that their golden arches sign is bigger and higher than any nearby competitor. I’ve even seen them placed in cow paddocks 500m from the store to secure the absolute best spot to lure the weary traveller looking for a motorway oasis.
Amazon understands what they offer better than anyone, and keeps finding ways to give a better deal.
- Faster delivery
- Free delivery
- Bigger range
- More book formats
- Instant downloads
- 1-click ordering
- Better book recommendations
- Extensive reviews for virtually any book in the world
They’ve taken away more barriers than any other company to help customers find, buy, and read more books.
Your offer extends from the shopping experience, to ordering, to payment, to delivery, to the way you collect and access and use the product or service.
So how do you make the following easier or better?
- Finding your product
- Understanding your product
- Comparison with other products/options/competition
- Services: Scheduling/handle hassles or worries/issues/complaints/failures/appreciation/review
Just one of these ideas could see you take the lead in your market.