How Your Market Sophistication Determines Your Approach

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Dear friend,

There’s this amazing obscure book that few people ever heard about.

It’s out of print and it sells for like $300 on Amazon. 

It’s called “Breakthrough Advertising” and it is written by a guy Eugene Schwartz. This guy was a famous copywriter, and this is considered one of the most sophisticated books on copywriting theory ever written. So do yourself a favor, find it, read it. 

In this book, he talks about a concept called “market sophistication” which most people ignore. It means that in time, markets evolve and what worked before, doesn’t work anymore. This is because prospects become more sophisticated, the competition is copying your claim, the market is too crowded, your customer heard them all and so on.

And this is important for one critical reason.

You must operate, work at the same level of sophistication as your market is. This is true when you name your product, when you write your copy, when you design your elevator pitch, when you do almost everything that has contact with your customer.

This level of sophistication is like the attire code at a restaurant. If it’s black tie and you show up in a t-shirt, you won’t even be admitted. If you go at McDonalds in a tuxedo, that’s strange too.

So let me walk you through the five levels of sophistication and tell you how all of this works.

Level #1 – You’re new and first in the marketplace.

This is when nobody is selling what you sell. You have a clear offer and a clear value proposition and there is no competition to speak of. Even if there is, the prospect doesn’t know about it.

All you need to do here is to simply state what you offer. Be direct, straight to the point. If this is something your marketplace wants, it’s enough to get their attention and sales.

Level #2 – Competitors show up.

When you have other companies competing for the same marketplace, then enlarge on what you promise. If everyone is promising results in 48 hours, you’re delivering in only 36. 

Your goal in a level 2 is to deliver a bigger benefit than everyone else. If you have a restaurant and everyone else is offering the same dishes, then deliver better food or bigger sizes. It’s simple.

Level #3 – The market is getting crowded.

By this point, everyone is promising everything that can be promised. It makes no sense to deliver bigger claims because it’s not cost effective or you can’t do it. In a level 3, everyone is shouting “I’m better” and you shouting louder won’t make any difference.

So what you do is you focus on the mechanism.

You stay with the same benefit but you show how you deliver it differently. So you may offer food just like everyone else but your food is cooked by a Japanese chef in a state-of-the-art kitchen. Basically, when everyone says “I’m the best”, you must give a very strong reason why you’re different from all the others.

Level #4 – Competitors copied your mechanism.

So maybe you were the first one to say you have a Japanese chef, and this worked for a while. But now everyone around you is claiming to have a Korean one, a Chinese one, even one from Madagascar. Therefore, your angle, your mechanism that made you a better choice is lost.

What now?

Don’t pack your things yet. Here is the time to focus on everything that makes you different. Bring more point of differentiation. Make it clear how different you are from everyone else. It’s like level 3 but supercharged.

Level #5 – All claims and mechanisms have been used.

When your market is so saturated that nobody believes anything anymore, you tap into the emotional play. You don’t compare claims nor mechanism. You don’t do things better or bigger because so is everyone else.

Instead, you focus on building a brand. You play on the emotional side. You clarify that you’re serving a certain customer and that you stand up for something.

A superb example of this is UAG.

UAG is a company that creates what I find to be overpriced phone cases. They’re $40 – $50 a piece and while they’re good, they’re not that good. The thing is that if they’d compete on claims, they’d lose. Every single manufacturer out there claims their case will protect your phone.

You’ll never hear “buy my case, if you drop your phone it will break but at least it looks nice”. All claim the strongest or slimmest or durable. So that approach is useless.

What about the mechanism?

Everyone claims the same technologies, with multiple layers and special materials to absorb shocks. You can find the same technologies in the $3 case and in the $90 one and I assume they’re built in the same factory.

So UAG plays a level five well. All their photos show active people, like the “man’s man” or the “daredevil woman”. You see iPads in camping tents and phones in nature and so on. They transmit a clear message – we create cases for people who love technology, who are smart but who also live a very active lifestyle.

You won’t find photos of the devices being protected in day-to-day life, it’s always somewhere surrounded by nature and somewhere where it’s likely to break without a case. Prospects don’t think anymore “well, feature by feature, what am I getting here for $50?”, but rather “Well, I am this person (or I want to be), so I’ll buy into this”.

This is the magic. Rationally, you can’t possibly want to pay ten times for a case, when a $10 one will do the job (they’re good cases though). But you want to be part of their tribe, the tribe of smart, connected people who are also active. 

So when in doubt, create your own tribe. Forget about features and benefits and point of differentiation. Instead, make it clear why your product is “the one” for a group of people and reinforce that perception through everything your brand does.

How important is all of this to your marketing?

Extremely. Almost all markets are level 4 or level 5. When I look over other people’s businesses, especially solopreneurs and coaches, they act at a level 1 and level 2. You need to learn how to stand above the competition by either getting a better claim (that you can deliver something more) or a better mechanism (the way you’re doing this).

If nothing works, drop all of that aside and build a brand that makes your product very appealing to a specific group.

Best regards,

Imran