Critical Care for Companies :: Emergency Counseling for Businesses
12 Steps: Executive Overview
Step 1: Why Businesses Fail
Step 2: How to Know if Your Business is in Trouble
Step 3: Are You Prepared for the Task
Step 4: Turnaround Leadership
Step 5: Organizing Your Turnaround Team
Step 6: Stop the Bleeding (Cash)
Step 7: Problem  Diagnostics
Step 8: Marketing During the Turnaround
Step 9: Developing the Turnaround Plan
Step 10: Down-Sizing Staff
Step 11: Dealing with Creditors
Step 12: Financing During the Turnaround
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Critical Care for Companies

Turnaround Step 8:

 Marketing During the Turnaround 

Many turnaround leaders have failed because they focused so much time and energy on the expense reduction side of fixing the system.  When they were finally able to lift their head above the cost-cutting project, they realized their sales revenues were in a steep decline, many of their top sales and marketing staff had resigned, and there were no viable products/marketing strategies of which to build the new business around. 

Turnaround programs have a way of getting very expensed oriented.  In other words people seem to focus on cost cutting above all else.  While this is very important and I'm not denying that you should not engage in a very aggressive cost-cutting initiative, as already stated in many of the other previous turnaround steps, I am sure that you have also head the adage "nothing happens until something is sold"!  Peter Drucker has said business has only two functions -- marketing and innovation. 

It is safe to say that sales and marketing is the engine that powers the entire business. So then to ignore marketing during this crises time then is very dangerous. In the same token, the first criticism that comes up when talking about developing an aggressive marketing program is the high cost that marketing programs carry.  

What then is the solution? If you believe you must market aggressively one the one hand but on the other, your financial resources are very stretched. I'm personally of the belief that one of the greatest return on investments that a business can make is in marketing. However, that means  intelligent, well thought through, strategic marketing.  And not the typical process of throwing thousands of dollars out there in hopes that something will work. 

The following is a marketing (and sales) program that I recommend you follow during this turnaround stage. You will find it practical, based on best demonstrated business practices, low cost, and very effective.  

Doug hall, a brilliant and creative marketing expert and author of "Jump Start Your Business Brain" , developed a concept called marketing physics.  In marketing physics he determined, through extensive research, that if a business will implement three laws, the probability of success will exponentially increase.  In my opinion, this is some of the best news I've ever come across as a marketer because of the strong research orientation going into the theory.  For example, Hall has determined if a product or service has a low overt benefit (Marketing Physics Law #1) then there is only a 13% probability of success.  If on the other hand of business is able to develop a high overt benefit, the probability of success increases to 38% or realize close to a 300% improvement in success! 

First Law of Marketing Physics:  Overt Benefit

In marketing 101 you most likely learned the difference between a feature and a benefit.  Benefits are what's in it for the customer.  A benefit is what your customer receives, enjoys or experiences in exchange for his time trouble trust or money. Features, on the other hand, are the facts, figures, technology and details that make up the structure of your product or service.  Benefits answer the question which every customer either asks directly or indirectly "what's in it for me"? 

The big news that the research has uncovered was not so much communicating benefits versus features, that's old news, but how the term "overt" supercharges benefits from a customer point of view. 

Overt means open and observable, not hidden, concealed, or secret. In other words, Hall found that if you took a benefit and made it much more open and observable, more easily understood, the effectiveness of your marketing increased dramatically. 

Several examples may clarify this principle.  A shoe shine shop could say "we give fast shoe shines" which is a benefit or they could say "we give 2 minute shoeshine" which is an Overtness or specificity added to the benefit.  Rather than say a "durable shoeshine", the overt benefit would be "armor shoeshine that lasts seven days". 

Customers don't have the time, energy or attention span to decipher implied benefit communications.  The average customers is overwhelmed with marketing messages.  Today, because of the hurricane of marketing messages customers are exposed to, there is a need to be brash, bold and in-your-face overt about your customer benefit and point of difference. 

Here is Doug Hall's process to develop Overt Benefits for your business, product, or service: 

 Turning Features into Benefits: 

    Step 1: Make a list of all defining features

  • List the attributes, ingredients and dimensions that define why you are as you are

  • Focus on both what you offer and how you deliver it to customers

  • List the obvious points of difference between you and your competition

  • List the less obvious but still significant points of difference versus the competition

    Step 2: Transform each feature into a benefit

  • Relentlessly ask the why questions of each feature:

  • Why should I care about this feature?

  • Why did you create this feature?

  • Why is this feature important?

  • Why is this feature necessary?

  • Why doesn't the competition have this feature?

    Step 3: Review current marketing materials for features & benefits. 

  • Each time a feature is listed, modify it to communicate the benefit that results from that feature.

Second Law of Marketing Physics: Real Reason to Believe 

The Overt Benefit is what you're offering. The reason to believe is How you're going to make good on your promise. To succeed, you need both the what and the how. 

Need some good examples in how to communicate Real Reason to Believe? Watch Infomercials! They start from a position of poor credibility with potential customers. For this reason, successful infomercials utilize over half their time communicating Real Reason to Believe. They do this by providing visual demonstration, "skeptic conversation" testimonials and common sense explanations of how the product works, as well as detailing the expert pedigree of the inventor of the product. 

Practical Tactic: Learn from the masters of Real Reason to Believe- Watch infomercials with a conscious awareness of Overt Benefit and Real Reason to Believe.

With paper & pencil, keep a scorecard of the Overt Benefit promises as well as the Real Reasons to Believe used to provide supporting credibility that the benefit will be delivered

Pictures have a power that transcends words. Turn the sound down for a while and watch the pictures. Can you see the Overt Benefit? Can you see the Real Reason to Believe? 

Score Your Real Reason to Believe vs. Competition

Step 1: Gather the materials that detail your brand, business or concept. Also gather similar materials on your competition.

Step 2: Make a list of each element of overt communication that enhances credibility for you and your competition.

Step 3: Add to your list and that of your key competitor the unstated things that should give customers confidence.

Step 4: Match and compare. Cross out the first item on your list. Then find a credibility item on the competitor's list that is of equal impact and cross it out as well. If it takes two from one list to equal the credibility of one on the other list, then cross out two for one. continue to cross items off each list until only you or your competitor is left standing with items still on the list.

What you have just done is close to what goes through customers' minds when they are trying to make a decision between you and your competition in a head-to-head decision situation. 

Proven Strategies for Real Reason to Believe (from Doug Hall's research)

         Kitchen logic (it just makes sense after hearing an explanation)-42% Probability of success

         Personal experience (providing your customers with an opportunity to see, feel and experience your product benefit)-45%

         Pedigree (providing confidence to potential customers as a result of detailing the heritage (development process, expertise, etc.) behind your product or service-41%

         Testimonial (customer or expert)-41%

         Guarantee (taking the risk out of the customer purchasing your product)-60% 

Third Law of Marketing Physics: Dramatic Difference

Sales and profits explode when an Overt Benefit and Real Reason to Believe pair is offered with a Dramatic Difference.

The data indicates enhanced Dramatic Difference levels increase probability of success from 15 to 53%. This means that you have a 353% greater chance of success when you have a high level of Dramatic Difference. These results confirm an earlier study by J.H. Davidson reported in the Harvard Business Review (April-May 1976). Davidson found a 370% greater chance of marketplace success for ideas that are dramatically different.

  • When you are unique, you stand out in the marketplace.

  • High Dramatic Difference-53% Probability of Success

  • Medium Dramatic Difference-40%

  • Low Dramatic Difference-15%

Dramatic Difference is a 2 step process:

First, customers evaluate whether you offer meaningful uniqueness versus existing options. Second, they evaluate your price versus existing options.

Evaluation of Dramatic Difference is how customers decide if their purchase decisions should be based on value or price. When there is no perceived meaningful difference, then price becomes the primary if not exclusive decision criterion.

Practical Tactic: How to Know a Dramatic Difference When You See One

The natural tendency is to exaggerate differences based on minor distinctions that are irrelevant to customers. How relevant is your point of difference? For a Dramatic Difference to be successful, it must be based on a combination of Overt Benefit and Real Reason to Believe that is relevant yet unexpected- relevant in that it has meaning, purpose and applicability to customer needs; unexpected in that it is novel, unusual, original, unique, new and different.


To maximize relevance, your Dramatic Difference must flow directly from your Overt Benefit and Real Reason to Believe pair. The only difference that is important to customers is one that impacts the experience they receive. Thus, relevance is linked directly to the connection between Dramatic Difference and Overt Benefit/Real Reason to Believe.

  • Do you have clear news to tell your customers?

  • Is your idea new to your company?

  • Is your idea new to your region of the country?

  • Is your idea new to your industry?

  • Is your idea new to your country?

  • Is your idea new to the world?

Once a business has determined its Overt Benefit, Reason to Believe, and Dramatic Difference you now have a unique selling proposition (USP) or strategy necessary to implement effective marketing programs.  Using these inputs, we are now going to move into several high impact marketing programs to maximize your business success.

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