Business Models For Dummies
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Pay attention to how many of your competitors have a similar unique selling proposition (USP). When Crest toothpaste first entered the market as the only cavity protection option, the USP was extremely powerful. Many competitors adopt what markets refer to as the “me too” strategy.

They put little time, money, or effort into identifying or developing niche markets. But they do make it their business to be extremely quick and very good at ripping off successful entrants into lucrative niche markets with very similar or even flat-out generic offerings.

As other “me too” toothpastes entered the market, Crest’s value proposition was weakened simply by the sheer number of participants claiming a similar USP. The value of your USP fluctuates with not only its uniqueness, but also the number of competitors claiming similar USPs.

From 1901–1950, the only three brands of toothpaste were Arm & Hammer, Colgate, and Ipana. Today you can find 34 brands of toothpaste and dozens of sub-brands (such as Crest with Scope or Colgate Total). The toothpaste category provides an outstanding lesson in how selling propositions can be carved ever smaller.

In the early days, competitors simply focused on being a quality toothpaste that didn’t taste horrible. Then fluoride came onto the market and created two categories, fluoride and non-fluoride toothpaste. Next came toothpaste aimed at children. Whitening toothpaste came to market next. Today, all-in-one toothpastes that do everything — whiten, control gum disease, taste good, and vacuum your floor — seem to be the rage.

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Jim Muehlhausen is the founder and President of the Business Model Institute as well as consultant and speaker to businesses large and small. He is the author of The 51 Fatal Business Errors and How to Avoid Them and a frequent contributor to Entrepreneur, Businessweek, and dozens of other publications.

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