{"id":719,"date":"2007-03-05T14:29:35","date_gmt":"2007-03-05T20:29:35","guid":{"rendered":"http:\/\/selectmetrix.com\/blogs\/2007\/03\/profit-over-market-share\/"},"modified":"2007-03-05T14:29:36","modified_gmt":"2007-03-05T20:29:36","slug":"profit-over-market-share","status":"publish","type":"post","link":"http:\/\/selectmetrix.com\/blogs\/2007\/03\/profit-over-market-share\/","title":{"rendered":"Profit Over Market Share"},"content":{"rendered":"<p>Selling Power offers up <a href=\"http:\/\/www.sellingpower.com\/html_newsletter\/article.asp?NLid=1&amp;Layout_ID=618&amp;ARTid=2825&amp;nDate=March+5%2C+2007\" target=\"_blank\">Forget Market Share; Go for the Profits<\/a> in their sales management newsletter and it is a compelling read.<\/p>\n<blockquote>\n<p>The problem with going after market share as a primary goal is that companies wind up sacrificing profitability in the process. When your whole marketing strategy is about preserving or increasing market share, it\u20ac\u2122s easy to get wrapped up in aggressive bidding wars. And it\u20ac\u2122s a downward spiral: customers <strong>learn to take advantage of that aggressiveness, demanding lower prices, which further erodes profits<\/strong>.<\/p>\n<\/blockquote>\n<p>It is a slippery slope because in essence a discount in price immediately discounts your value distinction.&nbsp; Businesses that not only articulate their value differentiation but also successfully defend it are the ones that grow&#8230;exponentially.<\/p>\n<p>Here is a comment to make sales manager&#8217;s gag:<\/p>\n<blockquote>\n<p>In other words \u20ac\u201c and here\u20ac\u2122s the tough part for many managers to swallow \u20ac\u201c when a competitor threatens your position by offering lower prices for a similar product, your first move should not automatically be to jump in to undercut him. In many cases, it is far wiser simply to walk away.<\/p>\n<\/blockquote>\n<p>Salespeople are tempted by the discount to close the deal (I can personally attest to it).&nbsp; But in the long run, discounts lead to dilution of your value.&nbsp; I have always been one to fancy market share through extraordinary offerings as opposed to greatly discounted products or services.<\/p>\n<p>Read the story about Reuters in the article for a real-world example of this principle in action.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Selling Power offers up Forget Market Share; Go for the Profits in their sales management newsletter and it is a compelling read. The problem with going after market share as a primary goal is that companies wind up sacrificing profitability in the process. When your whole marketing strategy is about preserving or increasing market share, it\u20ac\u2122s easy to get wrapped up in aggressive bidding wars. And it\u20ac\u2122s a downward spiral: customers learn to take advantage of that aggressiveness, demanding lower prices, which further erodes profits. It is a slippery slope because in essence a discount in price immediately discounts your value distinction.&nbsp; Businesses that not only articulate their value differentiation&hellip; <a class=\"read-more\" href=\"http:\/\/selectmetrix.com\/blogs\/2007\/03\/profit-over-market-share\/\">Read More<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"bgseo_title":"","bgseo_description":"","bgseo_robots_index":"","bgseo_robots_follow":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[17,4,9],"tags":[],"class_list":["post-719","post","type-post","status-publish","format-standard","hentry","category-marketing","category-sales-management","category-sales-techniques"],"jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p5Oho-bB","jetpack-related-posts":[{"id":1310,"url":"http:\/\/selectmetrix.com\/blogs\/2007\/11\/know-your-value\/","url_meta":{"origin":719,"position":0},"title":"Know Your Value","author":"Derrick Moe","date":"November 28, 2007","format":false,"excerpt":"I was meeting with a VP of Sales yesterday discussing the onramping program for the new salesperson we found for them.\u00a0 He brought up a good point in that his new salesperson was spending time researching their competition.\u00a0 Unfortunately, they are in a commoditized market with many - many -\u2026","rel":"","context":"In &quot;Sales Management&quot;","block_context":{"text":"Sales Management","link":"http:\/\/selectmetrix.com\/blogs\/category\/sales-management\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":617,"url":"http:\/\/selectmetrix.com\/blogs\/2007\/01\/the-selling-sales-manager-paradox\/","url_meta":{"origin":719,"position":1},"title":"The Selling Sales Manager Paradox","author":"Derrick Moe","date":"January 30, 2007","format":false,"excerpt":"We here at The Hire Sense are diehard hockey fans so pardon my analogy. Jacques Lemaire is the head coach of our Minnesota Wild. As head coach, he is obviously in charge of running practices, developing players, coaching during the game and, ultimately, winning games. He does all this without\u2026","rel":"","context":"In &quot;Sales Management&quot;","block_context":{"text":"Sales Management","link":"http:\/\/selectmetrix.com\/blogs\/category\/sales-management\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1631,"url":"http:\/\/selectmetrix.com\/blogs\/2008\/06\/the-absence-of-value\/","url_meta":{"origin":719,"position":2},"title":"The Absence Of Value","author":"Derrick Moe","date":"June 25, 2008","format":false,"excerpt":"We've been working on this value topic because it is the single, most important aspect of any sales position.\u00a0 A company that lacks a value proposition is destined to stumble through the market while being commoditized on price. I saw this effect 6 years ago when doing sales calls in\u2026","rel":"","context":"In &quot;Onramping&quot;","block_context":{"text":"Onramping","link":"http:\/\/selectmetrix.com\/blogs\/category\/onramping\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":342,"url":"http:\/\/selectmetrix.com\/blogs\/2006\/10\/absentee-sales-management\/","url_meta":{"origin":719,"position":3},"title":"Absentee Sales Management","author":"Derrick Moe","date":"October 5, 2006","format":false,"excerpt":"Imagine your goal is to lose weight so you sign up for a 1 year membership to one of the large health clubs in town. You pay the steep initial fee and the monthly amount. In the first 6 months, you go to the club and workout a total of\u2026","rel":"","context":"In &quot;Hiring Salespeople&quot;","block_context":{"text":"Hiring Salespeople","link":"http:\/\/selectmetrix.com\/blogs\/category\/hiring\/hiring-salespeople\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":977,"url":"http:\/\/selectmetrix.com\/blogs\/2007\/06\/the-path-to-sales-improvement\/","url_meta":{"origin":719,"position":4},"title":"The Path To Sales Improvement","author":"Derrick Moe","date":"June 4, 2007","format":false,"excerpt":"When you boil it down to the basics, sales departments are measured by profit increases. Simple, yes, but that is the crux of the goal. Operational efficiencies are part of the equation, but the focus here is on increasing profits via increased revenue. So how do companies go about achieving\u2026","rel":"","context":"In &quot;Hiring Salespeople&quot;","block_context":{"text":"Hiring Salespeople","link":"http:\/\/selectmetrix.com\/blogs\/category\/hiring\/hiring-salespeople\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/selectmetrix.com\/blogs\/wp-content\/uploads\/2007\/06\/windowslivewriterthepathtosalesimprovement-73cdpath-bridge6.jpg?resize=350%2C200","width":350,"height":200},"classes":[]},{"id":1432,"url":"http:\/\/selectmetrix.com\/blogs\/2008\/02\/why-do-salespeople-quit\/","url_meta":{"origin":719,"position":5},"title":"Why Do Salespeople Quit?","author":"Lee Fratzke","date":"February 22, 2008","format":false,"excerpt":"I've read\u00a0in many articles, blog posts and white papers that people take a job because of the company and quit because of a manager.\u00a0 I have talked to many salespeople about why they are looking for a new opportunity and\u00a0the vast majority do come down to their manager.\u00a0\u00a0But there is\u2026","rel":"","context":"In &quot;Sales Management&quot;","block_context":{"text":"Sales Management","link":"http:\/\/selectmetrix.com\/blogs\/category\/sales-management\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"jetpack_featured_media_url":"","_links":{"self":[{"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/posts\/719","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/comments?post=719"}],"version-history":[{"count":0,"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/posts\/719\/revisions"}],"wp:attachment":[{"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/media?parent=719"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/categories?post=719"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/selectmetrix.com\/blogs\/wp-json\/wp\/v2\/tags?post=719"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}<!-- WP Super Cache is installed but broken. 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