How do you price and market your services as seller in an on-demand platform? If you’re in the same marketplace as hundreds of other home-repair contractors who fix decks, clean eavestroughs and change light fixtures, what separates you from the rest?
Outside of the on-demand space, service providers can differentiate themselves based on their size, location and relationships.
- Location: Are you downtown or midtown? A common value proposition for businesses outside the downtown core is to leverage their lower operating costs.
- Size: Large businesses can leverage credibility, capabilities, service levels, while smaller ones can leverage specialization.
- Relationships: Goodwill and relationships are the biggest predictors of a service provider’s projected business.
The On-Demand World is Flat
Forget the old paradigm. The on-demand space pushes these factors to the wayside leveling the playing field for buyers and sellers. It doesn’t matter who you know, where you’re based or how large you are; everybody starts and operates from the same place. Buyers can compare you with other sellers and find the lowest-cost option with a click.
Embrace the New Space
Embrace the competitive pressure. Accept that your services are not unique and buyers can get comparable services instantly. This makes them very price sensitive. There’s less margin than ever before, so relying on the same price-dropping gambit everyone else will leverage is not enough. Here’s how you can stand out:
- Be easy to do business with. Buyers enter an on-demand space for convenience, so give it to them. Present your services transparently including your process, prices and deliverables.
- Build your Goodwill. Everyone starts at ground zero, but sellers who build goodwill through strong reviews and ratings will assuage buyer uncertainty and convert better than their competition. Take note that as an on-demand platforms evolve, their search algorithms and features will likely reward sellers with the highest rankings – e.g. AirBnB’s Super-Host feature.
- No frills and low customization. Customizations are expensive. Your job is to give the buyer what they need in uniform packages for everyone and that’s it – i.e. 10×10 deck costs $X and everyone gets the same 10×10 deck.
- Be Human. Humans are social creatures. Forget stock-photo business porn, take a selfie and show them who you are. Touch it up if you must!
Show them the people you have served as well. In marketing speak, this is called ‘social proof’ and it is a powerful tool to reduce customer fears. When you provide social proof, you demonstrate how others are using your services, signal how happy they are using them and paint yourself as a brand people love.
Business is changing at a record pace with incredible opportunity for those who embrace the transformation. If you can streamline, commoditize, humanize and build goodwill around your services now, your projections for on-demand profitability will increase.