Danny O'Neill - Differentiation in your market
About this video
Danny O'Neill compares coffee roasting to popcorn: customers want a finished product where and when they want it. The Roasterie stands out by roasting and shipping the same day within a nearby zone, and protects its brand by keeping quality high and turning down business that doesn't fit its values.
You'll be able to
- explain what a point of differentiation is using The Roasterie's freshness example.
- explain why expanding too far could add competitors and weaken a business's advantage.
- describe how a company might turn down business to protect its brand.
Key words
- Differentiation
- What makes a business's product stand out from its competitors.
- Competitor
- Another business trying to sell to the same customers.
- Trade-off
- Giving up one good thing to get another.
- Brand building
- Actions that make customers trust and value a company's name and image.
Transcript
- Danny O'Neill with The Roasterie. Basically you buy green coffee and it's not too different than if you wanted to buy corn on the cob or something like that, but we're buying something and we're transforming it. Popcorn might be a good analogy. People, they don't care about their kernels of corn.
They want popcorn. Grains of popcorn aren't going to do anybody any good and then popcorn at the car wash isn't going to do any good. They want it sitting in a theater, or they want it sitting at home. So what do you people want? And where do they want it? When do they want it?
Then can you get it to them? Freshness is key, key, key, key, right now if we do the same day, which we do. You order today and we're gonna roast it today, ship it today. You're either going to get it today or tomorrow. So we have this sophisticated map, and it's just Kansas City in concentric circles and what we really wanna do is concentrate on that phase one, you're gonna get your coffee today or tomorrow.
You just back up 500 miles. Now we probably have 5000 competitors that we didn't have. How many competitors do you want? So this is really a compelling point of differentiation. It also speaks to every value that we have about freshness. But there's so much within phase one.
I think we have 114 or 15 million people in there. There's a lot of room for us to grow within that. We wanna grow 10 times where we are right now by 2020. There are aspects of size and technology that can actually make us better, more nimble, and quicker than we were when we were small.
But at some point in time, whether you're baking bread or making wine, there's a point that there's trade-offs and you're not gonna be special anymore. You know if it's handmade by scratch and you could slice and dice and explain it scientifically and go through the ratios but if you did a blind taste test most of the time, scratch wins.
And the scientist the bookkeepers, the accountants would love to fight and argue about that but at the end of the day if you have a pallet you can generally tell. Is this still delivering on an our values? Is this still delivering on our mission? I tell my folks, I say to them "I really don't care "how sophisticated, or how intellectual "you wanna get about it."
I just just look at our logo, our package, our coffee in whatever environment that you're suggesting it be in, and I think, is that brand building? Or is that takeaway? We've turned down some significant pieces of business that would not be helpful to our brand and that we didn't know anything about and at the end of the day, it would of been just about money and it wouldn't have made us feel good.
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