CentrioHost Blog

The old sales saying is that while facts tell, stories sell.

Unfortunately, it’s not quite that simple in reality. Especially with more technical products or spaces where people need to know exactly what they’re getting.

So you have to walk a tightrope when it comes to marketing features vs benefits. You need to highlight specific features so that savvy buyers can easily figure out how you compare, while at the same time not alienating mainstream buyers who might not care about the intricacies of what you sell.

Go too far one way or the other and you run into problems. But it can also cause a host of other issues, like forcing you to compete on price because the marketing features you’re boasting don’t resonate with the benefits your customers might see.

Here’s why this often happens, and how to avoid it once and for all by transforming your features into benefits and outcomes that customers will happily pay more for.

• Does Your Company Compete on Price?
• How to Improve Your Customer Research
• How to Finally Transform All Features into Benefits

Does Your Company Compete on Price?

Remember how buying web hosting used to be a decade ago?

You typed in a few domains of the big boys. You scrolled over to look at how the plans and pricing were split up. And you basically needed an engineering degree to cipher it, even though they were all running cPanel/WHM. ?

Plans X, Y, and Z were only separated out based on the total size of bandwidth or storage across them. Most non-technical consumers, however, had zero idea of how bandwidth translated to their site requirements.

So what did they do? Default to the cheapest option of course!

Not just for one company’s plans, but also across the industry. If Competitor A’s bandwidth or storage matched Competitor B’s, but was $10 cheaper? The cheapest company would win.

That’s because they were stuck competing on features, not benefits.

Thankfully things have improved today. Look up a new host and there’s a slew of options, from the obligatory features to specify, to what each feature means for customers. When we relaunched our website in 2017, we gave this very topic a lot of thought. What do we want to market? Features or benefits.

If you visit our homepage or features page, you’ll find that we try to focus on the benefits, using terms like:

• Peace of mind, scale as needed, ultimate speed, secure like Fort Knox.
• Support that cares, no waiting in lines for support, no issue goes unsolved.
• User-friendly and yet powerful, built by developers for developers.

The problem with a race to the bottom and competing solely on features and price is two-fold.

1. Cost-conscious consumers are loyal to price, not brands. That’s why hotels on Expedia lower the rack rate as much as possible, to appear cheap, only to gouge customers when they check-in with a $50 daily resort fee. The issue is that it trains customers to seek out the lowest listed price in their star rating preference, as opposed to looking for your brand by name or reputation.
2. Competing on price also erodes margins, which actually backfires on the company over time because it reduces profits they can reinvest in making the product quality better. That means over the long haul, your products or services will get worse and worse, sabotaging the customer retention and true word-of-mouth recommendations to grow a big, long-lasting business.

Unfortunately, when you compete strictly on features, you’re often caught in this no man’s land. You’re not quite able to charge a premium to fuel future growth. But you’re also not able to grab market share because there’s always a bigger company out there who can benchmark those features and undercut your price.

Fortunately, there is a solution. And it’s actually pretty simple.

Consulting giant McKinsey found that most B2B companies make the grave mistake of prioritizing things that customers don’t actually care all that much about. They pulled from all shapes and sizes of enterprise companies across different industries and were able to compile a pretty consistent view. Then, they polled 700 executives to determine how and why they buy.

All of these companies loved to tout things like social responsibility, sustainability, and global reach. And yet, these all appeared to have a minimal influence on buyers perceptions of brand strength.

More worrying, though, was the opposite:

The inverse was true, as well: two of the most important themes for customer perceptions of brand strength—effective supply-chain management and specialist market knowledge—were among those least mentioned by B2B suppliers.

The last one was the kicker, though.

Honest and open dialogue, which customers considered most important, was one of the three themes not emphasized at all by the 90 companies in our sample. In addition to these disconnects, our analysis showed a surprising similarity among the brand themes that leading B2B companies emphasized, suggesting a tendency to follow the herd rather than create strongly differentiated brand messages.

All of this research led McKinsey to conclude that most B2B companies talk past their customers. In other words, they say a lot of things that don’t actually amount to all that much, and that clients could basically care less about.

Similar studies show the exact same problem. A study reported by CMO.com found that:

79% of customers said that brands have to actually demonstrate that they understand and care about me before they are going to consider purchasing.

In other words, they need to help translate their technical jargon into something that customers actually understand (and value).

For example, do you remember Windows RT? Probably not.

That’s because it actually wasn’t around very long. It basically dropped the ball in every category you could think of, including speed, performance, differentiation, and integrations.

The main problem, though, was that it never defined who it was for and how it helped them. Via The Register at the time:

For all its faults, Windows RT might still have stood a chance if Redmond had managed to communicate who its audience was meant to be. But it hasn’t. Three months after the Surface RT launch, it’s still hard to say who the target market for an RT device is.

To their credit, Windows themselves explain they didn’t really do enough to explain how Windows RT and 8 were different.

The problem is that this gets trickier over time. The way you position a product when you’re crossing the chasm is vastly different than when you’re entering mainstream. (Like, say, web hosting!)

So not only do you have to worry about how a product’s positioned in the market, relative to all the different alternatives. You also have to figure out the best way to position the product for people across the tech lifecycle adoption spectrum.

Innovators might like a product for the exact opposite reasons why a mainstream consumer might.

Developers might want more advanced features with their web hosting account (latest version of PHP, SSH