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Ask Champ - Summer 2012

Ask Champ - Summer 2012

April 1, 2012

3 minute Read

Champ, I’m in a saturated car wash market. I have five car washes in my area, with three of them having been built in the past six years. I’ve tried everything to promote my business, but I don’t sense that my customers see me as very different from the guy down the street. What can I do?

Mike, Cherry Valley, AR

Mike, you are asking yourself a very important question. What you are seeking is differentiation: making your business uniquely attractive versus the competition. It’s a basic rule of successful marketing, and one that we too often forget.

Some car washes have figured it out. Price can be a differentiator, depending upon the market. Speed can be another. But, the list of ways in which you can differentiate is quite long; here are a few:

• Product diversity/selection

• Service quality

• Guarantees

• Technology

In each of the above, ask yourself what you are offering, or could offer, to a customer that is different from the other car washes near you. Do you offer a better or unique product? I’m not endorsing, but an example would be some of the new online polishing and drying systems. Do your employees greet every regular by name and with a compliment? Do you offer a weather or satisfaction guarantee? Do you offer new technology that speeds up the visit (e.g., an RFID lane) or is safer for the car (e.g., the use of photo-eye profiling technology)?

I’d also encourage you to poll your customers. What are their “pain points” in visiting a car wash? What do they like best about your wash, or others? With this information, and your own careful study, you can identify what makes you unique. From there, it’s a matter of communicating your differentiator(s) and consistently delivering on your promises.

I read in your last article that I should not just be looking at price, but looking at the total value of what I’m offering. So, I did — and I’m still struggling! Is there any science to pricing, or is it all art?

Beau, Illinois City, IL

Beau, I’m going to go ahead and file your letter under “Another Satisfied Customer.” Remember, I’m a marketing consultant. I didn’t get to where I am today by just giving the simple answers! But, writers are paid by the word — so I’m happy to spend some additional time on this topic.

Pricing is an art, but there is absolutely also a scientific component. Here are some simple questions, the answers to which will put you on the road to coming up with a sound pricing strategy:

1. What will your location bear? Presuming that you don’t have a destination car wash (and most don’t), what are the levels of affluence in your area? Are you surrounded by barbers or salons; car dealerships or auto salons; convenience stores or specialty grocers?

2. What are your costs? Simple question, ‘eh? Usually, it’s not. Ask some of your car wash friends what their cost per car is, and then ask them what is included (chemicals, labor, salaries, utilities, debt service, capital expenditures, etc.). You’ll quickly find that too many operators don’t have a clear idea. You must.

3. What are your profit goals or requirements? “As much as possible” isn’t a studied response. If you are happy with a 2 percent return on your overall investment, you’re going to have much more latitude in your pricing. But you should also then stick to Treasury bills.

Once you get a firm understanding of the above, you’ll have a foundation from which to build. One strategy to consider is to build a menu (your regularly advertised price) that meets your cost and profit requirements, but experiment with periodic promotions to evaluate what else might work. This way, you’re gaining market intelligence without immediately positioning yourself too far off what you believe to be a safe pricing foundation.

If this doesn’t work, I know a consultant you can hire.

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