This week I was asked to pinch hit for a friend who was presenting at a conference and found himself with a conflict. The topic was Thriving in a World of Low Cost Competitors. I did the presentation for him (mostly because I love presenting). The topic got me thinking about the panic that many are feeling now with the current state of the economy, particularly when there are those out there that are offering seemingly similar services and/or products.

There are reasons why those Low Cost Competitors (LCC) are able to offer their serivice/product at the prices they do. What is their business model? In the health club world, it is typically a stripped down club, no child sitting, no classes, no training staff, minimal staff in general. Usually the LCC will have a manager, service desk person, someone to clean, and maybe a sub-contracted Personal Trainer. What they do have is a room of equipment. What’s their Unique Selling Proposition (USP)? They are cheap! AND… if you are someone that is comfortable with doing your own thing (or you think you can), that may be all you need.

So how do you compete? You don’t. Not on their USP. You need to differentiate. What makes you different than the LCC?

It’s the experience. It’s your place (the visual, the sounds, the smell, …cleanliness). It’s your people (smiling, friendly, attentive, helpful, remembers their name). It’s your programs (their structure, clarity, and the results they produce)

If the experience, the value is there, people will justify paying more for it, even when money is a little tighter.

more later

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