What is chutzpah marketing Pronounced huts•pah

Throughout this page, in many different ways, we are going to discuss motivating a customer to pick your company over every other company in your community. In some cases, due to the Internet, you may well be competing with companies all over the world. Business is a highly competitive endeavor, and the goal of your marketing program is to get the customer to pick you.

There are a lot of other voices yelling “pick me,” all in direct competition with you for the money in your potential customer’s pocket. Most of these other voices have more money and name recognition than you presently have. So, how do you compete for the minds of your prospects? The answer is, your marketing must talk to your prospect, solving a want that she has when she has it. You must use chutzpah marketing!

Before I explain how to talk to your customer, let me take a moment to define chutzpah marketing.

Chutzpah marketing is everything and anything you do to get the customer to pick you, keep picking you, and to tell their friends and family that they should pick you!

Anything and everything? Yep, anything and everything! From print advertising to customer service; from signage to clean restrooms; from welcoming smiles to clear return policies. Chutzpah marketers embrace the customer from first contact until after the product or service is all used up or completed. I agree completely with L.L. Bean who said, “No sale is really complete until the product is worn out, and the customer is satisfied.”

Chutzpah marketers strive to enthuse customers at every contact point. Basic contacts run the gambit, including each time the customer enters the store, calls on the phone, enjoys the product or service, or tells others of their experience with the chutzpah business, are major events for the chutzpah marketer. A chutzpah marketer’s goal is to have their customer be filled with avid enjoyment whenever they interact or think about your business.

Luckily for us, most businesses treat their customers as if they are the enemy, or at least a nuisance. So a little chutzpah marketing goes a long way, and a lot of chutzpah marketing takes your company to outstanding heights.

To pull this chutzpah enthusiasm together we are going to need to know how your company fits into the minds of your customers.

The psychology of your customer’s mind

The human mind has the ability to keep track of six or seven things at one time. This could be numbers, such as a phone number, or a list of seven items to pick up at the store.

Local phone numbers are typically seven digits long, 123-4567. They tend to be pretty easy for most people to learn. Once you add the area code, you get ten digits e.g. (202)456-1414. Most people have a tough time remembering ten digits. In order to master this we kind of cheat. We categorize the numbers into memorable packages of seven digits or less. For example, the area code for Washington, D.C. is 202. So, if I told you that the number for the White House Switchboard is 456-1414, you could put the two pieces of information together and pretty easily memorize the phone number for the White House Switchboard 202-456-1414.

There has been a lot of research done to prove that humans do well remembering seven things at a time. By grouping items together, we can easily expand our basic skill past seven items.

In marketing lingo, getting things to stick in a customer’s mind is called branding or positioning. Throughout this book I am going to show you how to get your company’s offerings positioned in your customer’s mind so that you will have a customer for life. In addition to becoming a customer for life, this same customer will talk glowingly about your company, thus sending more customers your way. All this on a shoestring budget.

Branding

In the cereal aisle Wheaties has taught you that it is the “Breakfast of Champions”. Cheerios has taught you that they are the “heart healthy” cereal. Kix has branded themselves as the “mom approved” cereal. What position does your company hold in the mind of the community? For some of you it may be that the community doesn’t know you exist (yet!). For others, you are an established business with little growth potential until you evolve your branding.

Your company’s positioning needs to be a choice made by you. It is how you have taught others to think of you (or not think of you).

When people shop they shop in categories. The consumer’s mind is too full to keep all information readily available. So, consumers place things into categories. Examples of categories are:

 

  • Expensive shoe stores
  • Inexpensive shoe stores
  • Dirty restaurants
  • Clean restaurants
  • Sit down restaurants
  • Fast food
  • Friendly tire store
  • Unfriendly tire store
  • Large cheese selection
  • Basic cheese selection

 

The categories are developed by consumers based on their personality and their experiences. So, the same grocery store can be in different categories for different people. My wife and I have different categories for the grocery store we shop at the most:

My Beloved Wife

  • Convenient
  • Friendly employees
  • Great vegetable selection. Clean, consistently good quality

Dr. Phil

  • On the way home
  • Talkative employees
  • Overpriced

 

We have our categories built from our experiences. Although we do a lot of shopping there, we go way across town to the less expensive, larger store that neither of us really likes.

The two stores understand us too. One advertises, Lowest Prices In Town, while the other proclaims, Friendliest Store in Town.

The categories are the stores’ attributes, their positions in our minds. If they want to stay in our minds they need to live up to their attributes. If you look at my categories you will see that the “friendliest store in town” attribute is often a bother to me. I don’t care for the small talk. I wouldn’t mind if they had an express line specifically for No Chitchat. I want to get in and out of the store. The friendly chitchat with every customer adds up to slow moving lines for me.

If a store opened up right next-door to the friendly store, one that was exactly the same, but with a no chitchat checkout, I would choose that store on most days.

In the marketplace, business are in competition with each other. They are categorized in the minds of your potential customers and these categories, branding, is how the customer limits their choices. Have you ever wondered why the mega companies like Coke and Pepsi even bother to advertise? They’re sold everywhere. Everyone already knows about them. The reason they constantly advertise is to stay in the minds of their customers. They each spend millions for a category position in our minds.

William J. McEwen in his book, Married to the brand, why consumers bond with brands for life, explains that, “Brands serve a greater purpose—not just for the marketer, but for the consumer, too.” He continues:

Brands identify, define, and express the experience of using the particular products and services with which customers connect. Brands are partners in the dating game, the entities with which individual consumers sometimes form important, reciprocal, and even loving relationships.

Chutzpah branding in the real world

What we need to focus on is the benefit to the customer. Let’s say you’re in the plumbing business or the deli business—so you sell a kitchen sink repair or a pastrami on rye. What did the customer receive? More succinctly, what value did the customer receive?

A customer will only buy your commodities, products, services, or skills if he perceives a benefit to himself that is greater than the cost to his wallet. Customers buy because of perceived value, not because of your skill, item price, or wicked good looks. The sale and all subsequent sales are about the customer. Is the customer getting their needs met.

What businesses like to sell

  • Toaster ovens.
  • Wills and trusts
  • Hamburgers
  • Pizza

What customers like to buy, what they value

  • Melted cheese on bread anytime I want it… or maybe a Pop-Tart.
  • A way to get my kids to go to college and finally make something out of themselves without having to hear what my sisters think I should do with my money!
  • A cool quiet place to sit down for just a minute and feed the kids, so I can get them to soccer practice by 5.
  • Food that relieves me from having to cook or clean up much.

 

A chutzpah marketer focuses on the needs of the customer. Too often businesses focus on their needs, forgetting that without repeat customers they are doomed.

For example, the business’ versus the customer’s view point:

Business’ point of view

  • We need to sell $1800 during lunch today.
  • I need 6 service calls today

Customer’s point of view

  • Easy to get to, cheap lunch that makes me think I’m eating kind of OK—just in case the wife asks.
  • I have to grab a sandwich and get gas during lunch or I’ll be late picking up the kids at school.
  • I need my sink unclogged by 3 PM, so I can get the kids from school. Who can I trust, because I don’t know what they do under the sink, and I’m pretty sure they all overcharge.

New FTC Rulings

According to the Federal Trade Commission (http://business.ftc.gov):

 

The FTC’s Bureau of Consumer Protection enforces laws that protect consumers against unfair or deceptive practices. The Business Center gives you and your business tools to understand and comply with the law. Regardless of the size of your organization or the industry you’re in, knowing – and fulfilling – your compliance responsibilities is smart, sound business.

 

The guidance documents in the Business Center are your link to the law. Browse by topic - Advertising & Marketing, Credit & Finance, Privacy & Security - or by industry, to find what you need to know.

The legal resources section of the Business Center is where you’ll find more in-depth, legal information - like case highlights, advisory opinions, staff letters, and rules the FTC enforces. You’ll also find staff reports and FTC workshops.

The multimedia gallery offers short videos and podcasts that explain your compliance responsibilities.

The materials in the Business Center don’t have any copyright restrictions, so you can share them with your employees, your colleagues and your community.

I highly recommend reading the FTC rules. You are legally obligated to follow them.

The following may be of most interest:

 

The following is excerpted from the FTC’s: Advertising FAQ's: A Guide for Small Business.

What truth-in-advertising rules apply to advertisers?

Under the Federal Trade Commission Act: Advertising must be truthful and non-deceptive; Advertisers must have evidence to back up their claims; and Advertisements cannot be unfair.

Additional laws apply to ads for specialized products like consumer leases, credit, 900 telephone numbers, and products sold through mail order or telephone sales. And every state has consumer protection laws that govern ads running in that state.

What makes an advertisement deceptive?

According to the FTC's Deception Policy Statement, an ad is deceptive if it contains a statement - or omits information - that:

Is likely to mislead consumers acting reasonably under the circumstances; and

Is "material" - that is, important to a consumer's decision to buy or use the product.

What makes an advertisement unfair?

According to the Federal Trade Commission Act and the FTC's Unfairness Policy Statement, an ad or business practice is unfair if:

It causes or is likely to cause substantial consumer injury which a consumer could not reasonably avoid; and

It is not outweighed by the benefit to consumers.

How does the FTC determine if an ad is deceptive?

A typical inquiry follows these steps:

The FTC looks at the ad from the point of view of the "reasonable consumer" - the typical person looking at the ad. Rather than focusing on certain words, the FTC looks at the ad in context - words, phrases, and pictures - to determine what it conveys to consumers.

The FTC looks at both "express" and "implied" claims. An express claim is literally made in the ad. For example, "ABC Mouthwash prevents colds" is an express claim that the product will prevent colds. An implied claim is one made indirectly or by inference. "ABC Mouthwash kills the germs that cause colds" contains an implied claim that the product will prevent colds. Although the ad doesn't literally say that the product prevents colds, it would be reasonable for a consumer to conclude from the statement "kills the germs that cause colds" that the product will prevent colds. Under the law, advertisers must have proof to back up express and implied claims that consumers take from an ad.

The FTC looks at what the ad does not say - that is, if the failure to include information leaves consumers with a mis-impression about the product. For example, if a company advertised a collection of books, the ad would be deceptive if it did not disclose that consumers actually would receive abridged versions of the books.

The FTC looks at whether the claim would be "material" - that is, important to a consumer's decision to buy or use the product. Examples of material claims are representations about a product's performance, features, safety, price, or effectiveness.

The FTC looks at whether the advertiser has sufficient evidence to support the claims in the ad. The law requires that advertisers have proof before the ad runs.

BigRed’s as a brand

BigRed’s Burgers is the newest burger joint in Fiction, California, a community of 100,000 people. Let’s evaluate BigRed’s to see how this business is positioned in the friendly town of Fiction.

Minnie and Big Red both retired from county employment a few years ago. Their dream was to move from the big city and open an old fashion hamburger shack like the one they fondly remember from their youth. They wanted to supplement their retirement  income by grilling burgers and making friends. Their menu was simple: large portions of burgers, fries, onion rings, soft drinks, and ice cream shakes, for a fair price. They figured that they would be making money hand over fist.

After two years in business, the business was making just enough to stay open, but they hadn't yet repaid themselves for the startup funds. On a positive note, both Minnie and Big Red loved going to work and they had made some good friends in their newly adopted town.

BigRed’s competition

I asked Minnie and Big Red to fill out the following 2 question form:

1. Name the business competition in your area:

 

2. Place them in the following graph:

 

 

They completed the form as follows:

1. Name the business competition in your area:

McDonald’s, Burger King, Wendy’s, Carl’s Jr., In-N-Out Burger, Red Robin, Marie Callender’s, and Denny’s.

2. Place them in the following graph:

 

What this graph illustrates is that BigRed’s is a small fish in a big pond. It would be very hard for BigRed’s to compete head to head with the likes of McDonald’s and Wendy’s in the minds of burger customers.

This brings us to the chutzpah question, “How can you get a place in the customer’s mind?” The answer is, place yourself in a different brand category in your customer’s mind.

The big burger chains own the category, “Fast Food Burger”, and they will continue to spend millions to keep that powerful branded position, while constantly fighting amongst themselves for market share. But, BigRed’s has chutzpah, they can carve out a new category that the big burger corporations aren't able to occupy.

We will come back to BigRed’s in a little while, but for now, let’s talk about your company. Take some time to complete the two questions:

1. Name the business competition in your area:

2. Place them in the following graph:

You will have to come up with the X and Y categories of your graph based on your company’s business type. Some common categories are:

  • Small/large
  • Low market share/high market share
  • Well establish name/unknown name
  • Lowest prices/highest prices
  • Low customer service/high customer service
  • Tourist trade/local trade
  • Close to freeway exit/far from freeway exit

Draw a rectangle on a piece of paper... the process of figuring this out will really help.

You may find, depending on your business climate. that you will need to come up with many graphs for the same group of companies. A company and a group of companies often has the main brand and many secondary brands.

BigRed’s Burgers chutzpah assignments

Let’s look at how Minnie and Big Red dealt with four chutzpah branding questions.

 

  • List problems that you solve for your customers.
  • Who are your customers?
  • What is the brand (position) of your business in the community?
  • How does your customer find you?

 

I asked Minnie and Big Red to fill out these four chutzpah branding questions. They struggled with this. They both wanted to write from their point of view, but the questions need to be answered from the customer’s point of view. This is what we ended up with:

#1: List problems that you solve for your customers.

  • Friendly environment
  • Food is tasty
  • Food is made to order and served quickly
  • Easy to call in lunch orders for pick up

#2: Who are your customers?

  • Workers in the neighborhood
  • Moms and dads in the neighborhood
  • Moms and dads on the way to soccer or baseball fields
  • Single people in the neighborhood

#3: What is the brand (position) of your business in the community?

  • Small place with good burgers and milk shakes
  • Mom and pop business, feels friendly
  • Custom orders makes it easy to get exactly what you want
  • Food is good but a little pricey compared to other fast food places in town

#4: How does your customer find you?

  • See our sign
  • Walk by and see people eating
  • Newspaper ads, but we don’t think they really worked

 

When I sat down with Minnie and Big Red, they were frustrated. They explained that they made a much better tasting burger and fries than the big companies. They were frustrated with the fact that the people of Fiction just didn’t get how hard they worked putting out a quality product for them to choose!

I bring this up because this frustration is normal in the business world. Your product is superior and you have worked so hard to get where you are. But, that is all about you. To get customers to choose your business you will have to focus on your potential customers’ needs. You will have to show them that you are right for them.

I asked Minnie and Big Red to tell me who their average customer was. After a little bit of brainstorming, they came up with this statement.

 

Lunch is mainly hard working men looking for filling food and fast service. Dinner is overworked, really busy, moms and dads needing to get food for the family.

 

Then I asked the biggest question of them all: How can you help your customers?

 

With this information I asked Minnie and Big Red, “How can you help your customers?”

“Help ‘em? We already make the order exactly the way they want it,” Big Red said.

“Yeah, but,” I interrupted, “You’re talking about the burger, McDonald’s does burgers. What can your company do that McDonald’s can’t do?”

“I think the busy moms and dads would like us to deliver the food,” Minnie said.

“Delivery? We have never done that,” Big Red grunted.

“It's an idea. Your competitors can’t deliver,” I said.

Then the ideas started to flow.

 

Over the next month, BigRed’s started three new (very low cost) services to help their customers:

Curb side pick-up “Dinner boxes” for the soccer and baseball families.

Lunch delivery service for the three business complexes just down the street.

Friday and Saturday night home delivery to the four apartment complexes and the six blocks of single family homes all within minutes of BigRed’s.

 

As we will discuss in subsequent chapters, bringing unprecedented customer service tends to be inexpensive and it brings great rewards to the company that does it. By positioning BigRed’s as the burger place that caters to its  customers, the branding of the company changed. BigRed’s left the “fast food” brand they were lost in and developed a whole new category: “Truly Helpful.” A brand that stuck in the minds of their growing clientele. In a few short weeks, the fast food burger eating customers changed their thoughts from, “Rush over to Burger King’s drive-thru” to “Call or email BigRed’s, they’ll bring it to us while we…” BigRed’s became the extra pair of hands, or extra employee, their customers needed to live their lives the way they wanted to live them.

Chutzpah knowledge is power

Just a little bit of chutzpah information can go a long way. By knowing your customers and figuring out how to give them even more of what they like about your company, you too can re-brand your company as an essential part of your customer’s life.

Take the time to answer the following questions. You may even want to start asking your present customers what they like about your company, why they choose your company. Stay open minded by asking yourself, “How can we do it differently?” You are looking for your new, enlightened position in your customers’ minds.

 

#1: List problems that you solve for your customers.

#2: Who are your customers?

#3: What is the brand (position) of your business in the community?

#4: How does your customer find you?

#5: How can you help your customers?

 

Back to Business and money index

 

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