Dominating Your Market by Shortening the Customer Decision Cycle
Jan 24, 2019
Let's start from the beginning. What are we trying to do as marketers?
Put simply, we are trying—through a variety of means—to get lots of people to buy our products—repeatedly, in large quantities and at rewarding prices. We are trying to bring our products to people in the most profitable manner possible, both for our customers and ourselves.
How do we accomplish this? It's widely believed that there are only three ways to increase sales: increase the number of customers, increase the dollar amount each customer spends per purchase (higher prices and/or larger orders), or increase the frequency with which the customer buys. Ask virtually any marketing expert, consult the marketing books, and they will all tell you that this exhausts the possibilities.
But the most important way of increasing sales and dominating a market has never, to my knowledge, ever been written about: Increase the speed with which decisions are made. You heard it here first. Let's take a look at this concept in detail, because decision acceleration is the most powerful way to dominate a market, and word of mouth is the most powerful way to accelerate decisions.
Amazingly, marketing success is determined more by the time it takes your customers to decide on your product than by any other single factor. Decision speed is more powerful than positioning, image, value, customer satisfaction, guarantees, or even product superiority, because focusing on it forces you to organize these factors, and many more, into the most potent combination possible.
Why Decision Speed Determines Product Success
Decision speed is the time it takes your customers to go from initial awareness to enthusiastic full use and recommendation of your product or service. This in turn is governed by the simplicity, ease, and sometimes the fun of the decision process.
Obviously, the company that makes its products easier to decide on will acquire customers faster and increase market share faster. But increased decision speed causes much larger changes in market share than might be obvious. In fact, it's the key to dominating your market.
Accelerated decisions are in a different class from other marketing program adjustments. While most marketing changes—at best—provide incremental market share increases (typically 10 to 30%), faster decision cycles can improve market share by orders of magnitude (10 to 100 times).
Why Speed Equals Multiplied Sales
Suppose there are five similar products competing in a new category. All things being equal, they will each eventually capture a 20% market share. Say the decision cycle time for these products is about one year.
Now suppose that you are competitor #1, and you find a way to make several of the time-consuming steps in that decision cycle easier for your prospects, cutting the decision time in half. What happens to your and the other competitors' market share?
Obviously, if your product achieves its expected one-year market share in six months, it will have effectively doubled the market window of opportunity, giving you the time and resources to capture another 20% market share in the remaining six months. This would give your product a 40% share at year's end, with the four other competitors sharing the remainder, at 15% each.
But even that triumph is not the whole story. It leaves out the powerful effect of word of mouth and assumes each prospect makes a solitary decision. When you increase the decision speed for your prospects by 100%, you not only get customers sooner, you turn those customers into zealous advocates for your product before the competitors have a similar opportunity. Why would your user endorsements be any better than those from competitors? First because they are available sooner, but second, and more important, your endorsements will be supported by the targeted, persuasive information you selected and provided to shorten the decision cycle in the first place!
With this kind of decision support, the first marketing months can generate such evangelism among early adopters that a 40% market share could be too conservative a goal. A more likely outcome could be a 60% to 80% market share for your product, a 10% share for product #2, with the others splitting the remainder. This isn't pie in the sky. Most marketers will recognize that this is the pattern for many products.
The Secret to Shortening the Customer's Decision Cycle
Shorten the decision cycle by making the decisions easier for the prospect, by focusing on its particular decision roadblocks, bottlenecks, friction points, and rough spots. It's this ridiculously simple marketing idea that's at the root of my entire approach to marketing. It's one of those ideas that is simple, obvious, compelling, and almost totally ignored, both in theory and practice. Decision acceleration is not written about by marketing gurus, and it is not thought about by product managers formulating product strategy. It will turn into your secret weapon.
Decision Acceleration System
To make the decision easier, think of your sales people, product materials, presentations, seminars, press releases, hot lines—in fact, every aspect of your marketing program—not as sales communications, but as a Decision Acceleration System for your customers and prospects. To turn your marketing into a Decision Acceleration System, make the product:
- Benefits, claims, and promises obvious and compelling
- Information clear, balanced, and credible
- Comparisons reveal meaningful differences
- Trial easy
- Evaluations crystal clear and simple
- Guarantees ironclad and generous
- Testimonials and other word-of-mouth marketing relevant and believable
- Delivery, training, and support superior
When customers have information that makes a decision easy, they make it quickly. When a company makes it easy for me to decide on its product, not only do I buy the product, I also feel gratitude and a sense of loyalty to the company that gave me the easy choice. Full, balanced information about a product or service—including clear product comparisons, guarantees, and a commitment to support, all provided in the right sequence—enhances the value of the product and gives it a competitive advantage. Stated another way, the product with the better decision-support system often has the competitive edge, even if the product itself is not superior.
This isn't just theory. It is a fact of life for every product or service, whether it's a simple consumer packaged goods product or the most complex medical, industrial, financial, or agricultural device or service. If you make the decision easier, more prospects can select your product more quickly and with greater confidence, and overwhelming market dominance is often the result. Not just market share increases of 10% , 25% , or even 50% , but 10, 25, or 50 times the expected market share. For the very few who have discovered it, it's the best-kept secret weapon in marketing.
Sometimes a product comes along that is so obviously superior that it seems to "sell itself." (Even then you could say that it sold itself because the decision was so easy.) But most buying decisions take time and effort. If the information provided by the seller is inadequate, we must go searching on our own to make up the deficits. At best, the days, weeks, or months lost by those delays cause confusion (a form of decision friction) and thereby slow the product's growth, making it share the market with all the competitors. Your advantages get lost in the shuffle. These decision points accumulate, causing prospects to drop out of the decision cycle, and spell disaster for the product's success. You need to structure the decision process for customers, and guide them through the twists and turns. Without active guidance, they will falter and flounder, and drown in a sea of information.
The Most Important Passage in This Book
Shorten the decision cycle by making the decisions easier for the prospect, by focusing on their particular decision roadblocks, bottlenecks, friction points, and rough spots. It's this ridiculously simple marketing idea that's at the root of my entire approach to marketing. It's one of those ideas that is simple, obvious, compelling, and almost totally ignored, both in theory and practice. Decision acceleration is not written about by marketing gurus, and it is not thought about by product managers formulating product strategy. It will turn into your secret weapon.
The marketer can make the decision road a superhighway or a neglected, pothole-strewn byway. If the road smoothes the way for prospects, the speed limit goes up and there can be enormous market-share gains. This makes decision acceleration the most critical element on the road to market success.
This article is excerpted and adapted from The Secrets of Word-of-Mouth Marketing: How to Trigger Exponential Sales Through Runaway Word of Mouth, by George Silverman (AMACOM, 2001).