In the world of marketing sameness, where brands copy each other and play it safe, how do you genuinely differentiate yourself?
Peep Laja is the founder of CXL Institute, an in-depth marketing training program. In this episode, he explains how your brand can stand up, stand out, and be different.
listen to this episode
- The reason why the only difference between most companies is the logo
- How differentiation can be achieved by one strong thing or a combination of lots of smaller things
- The consequences of sameness in your business
- Which differentiations are not worth the investment
- How to define a position in the market
- Why you want to attract a certain group and repel another
- Using differentiation to give potential customers a reason to choose you
- Thinking actively about how you are influenced
- CXL Institute
- Differentiate or Die – Jack Trout and Steve Rivkin
- Positioning – Al Ries and Jack Trout
- Obviously Awesome – April Dunford
- Play Bigger
- Linkedin Learning
- Whiteboard Friday
- How Brands Grow – Byron Sharp
- Road Less Stupid – Keith J Cunningham
- 22 Immutable laws of Marketing – Al Ries and Jack Trout
- The Brand Gap – Marty Neumeier
- Zag – Marty Neumeier
- Brand Flip – Marty Neumeier
Louis: All right. Bonjour Bonjour and welcome to another episode of EveryoneHatesMarketers.com, the no-fluff actionable marketing podcast for marketers, marketing consultants and tech people who are just sick of shady, aggressive marketing. I’m your host, Louis Grenier. In today’s episode, you’ll learn how to fight sameness and differentiate your brand. My guest today is the founder and CEO of CXL, CXL Institute, which is an in-depth marketing training program. They’ve trained folks at Google, Cisco, HP, IKEA, Hilton, etc, etc. It all started a few years ago with a blog called Conversion XL, moved on to a conversion rate optimization agency, and now they have probably one of the best marketing and growth training programs in the world with CXL Institute. Peep Laja, very happy to have you on board.
Peep: Thanks for inviting me.
Louis: Let’s jump in straight away into the topic. I’m super interested to hear about it. We are not going to talk about conversion rate optimization or growth really. We’re going to talk about something that is even deeper, and it’s interesting because I’ve been following you for a long time online and I can see the evolution of what you’ve been talking about through the years.
A few years ago, you were talking about CRO, conversion rate optimization, growth a lot. Recently, you’ve talked more about acquisition as well because realizing that it was big problem for marketers and through the CXL Institute you’re solving this as well, but now it seems that you are even more interested in the deeper topic of differentiation, like the actual building a brand that people recognize and care for and buy from instead of their competitors. Is that a fair summary of the trajectory of what you were interested in?
Peep: Exactly right. Yeah. I mean I was gung-ho about conversion optimization as you said, but there was a point maybe four years ago when frankly I just got tired of being a consultant. I can’t explain the same stuff all over again. And then, also had an identity crisis of who I am anymore, and over time as I pivoted into management and running a business, wearing a different hat and then starting to grow CXL Institute and now Copytesting as well, I got more and more interested in the topic of differentiation and sameness because that’s the default of the world.
Louis: This word, sameness is something that I haven’t really heard that many people mention the problem this way before, so let’s talk about that first. How do you define sameness? In your mind, what does it mean actually?
Peep: Mm-hmm (affirmative). Sameness is the combined effect of brands or companies being too similar in their offers, poorly differentiated in their branding, and also indistinct in their communication, meaning that they say the exact same things, “We are the easiest email marketing software,” and also being the exact same. Most companies out there, overwhelming majority, 99.7% use vanilla language. Their products and services are pretty much like any other company [inaudible 00:03:31]. You can just replace one company easily with another, and their marketing messages are near identical to that of their competition.
If you visit websites of competing companies, you’ll find that they really offer no meaningful differentiation. In fact, the value proposition, the way they phrase what they do or the value they add it’s crafted from the point of view that they’re the only one doing what they do. It’s ridiculous. And then, there are popular books out there also like StoryBrand. I hate that book. It teaches people to say what you do, and it doesn’t even mention once that there might be other chiropractors in the town you operate in.
Louis: Yeah. I’ve heard you talking about this book before. Okay. It’s about basically saying the same thing, having the same offer, having the same design. You can basically replace the logo with someone else and it’s going to be the same.
Peep: Exactly right. The only difference between most companies is the logo really, or their colors.
Louis: Okay. Why is that?
Peep: Two reasons, or multiple reasons. One is that the times when you see companies that are truly different is when there’s some innovation happening. It’s a new thing. It’s a new category. Tesla is making electric cars with long-lasting batteries. They’re an innovator, the only one doing what they’re doing, for now. As the electric car category gets more mature, five years from now every single car maker will have electric cars with as good or better electric batteries.
What I’m saying is that over time as categories mature, competitors become more and more similar to each other. My favorite example is hotels, a very mature category. In almost every single hotel you get lotion, you get soap, you get shampoo included, but not toothpaste, not toothbrushes. Even water you mostly have to pay for still. Why? They change your sheets every single day. Why is that the default in every single hotel? Why is not choice the default? It’s because everybody’s looking at what the competition is doing. In software, “The feature, the competitor released that feature. We got to build that feature too.” Everybody has feature parity. That is the main reason.
In terms of the language people use, why the language is vanilla is that I think being different is scary. You don’t want to alienate somebody. It’s easier to be inoffensive, and it’s also really tempting to be a safe and boring company. You do your safe and boring marketing and you post safe and boring advertising because if you’re inoffensive you are beyond criticism. You don’t stand out, but also won’t get hit. You won’t get fired for running a campaign that might piss somebody else off because nobody will call you out because you are just like everyone else. Obviously, the problem is that nobody will also care.
Louis: The counterargument to that, to say every hotel does the same thing is that people expect it, therefore you must offer it. Everyone expects their sheets to be changed every day in the hotel, everyone expects soap and shampoo, all of that. What’s the answer to that conundrum in a sense? You understand that you need to be different [crosstalk 00:07:28]-
Peep: Sure. What you’re saying… what you’re talking about here is table stakes. Yes, you have to do that if they expect that, but then if you just added the damn free toothpaste you will already be different in one way. Differentiation, it can be one strong thing but it also can be a combination of a lot of things, so you need to deliver on the table stakes. If you have an email marketing software, they expect the email marketing software to track this and have this feature, so you need all those features, absolutely, but then you need to go beyond that.
Louis: Okay. There is one thing I need to check. I’m going to stop the recording right now and start again in-
Peep: Terrible thing to waste. Yeah.
Louis: It would be. Okay. Table stake features, table stake stuff are what hotel do as you said, the shampoo, the soap. Excuse me. I guess we’re going to have to restart.
Louis: Coronavirus. All right. Table stake features as you said, that’s what people expect. You go to a hotel, you expect your sheets to be changed every day, shampoo to be given, all of that. In this world of sameness where everyone is copying each other, what do you think are the consequences of that? Before we dive into how to actually be different, let’s talk more about what are the consequences or the problems of that sameness. What could happen to your company or to your freelance business or whatever else if you just do table stake stuff?
Peep: Mm-hmm (affirmative). If you are already well-known, especially if you are already the category leader, you are the Mailchimp of email marketing, then differentiation doesn’t matter that much. If you look at Nike shoes, they’re not really different from Adidas or New Balance. It’s pretty much the same stuff. It’s not a problem if you’re already well-known. People know you and they know you’re competing on brand, which is also part of differentiation.
If you are an upstart, if you’re entering a crowded market, and for instance if you look at the … Scott Brinker maintains the Martech landscape, and in 2019 it was more than 7,000 tools in marketing technology alone, and of course it has multiple subcategories, but it’s still a niche or a thing.
Louis: And excluding countries as well. Sorry to cut you, but this martech landscape excludes any specific software company or technology from a specific country. Let’s say a French email marketing software doesn’t include it, so it’s really the tip of the iceberg.
Peep: Right. Now, if you’re building your new startup or you have had it for a while but you’re still small, maybe you just made it past one million in revenue or two million, which is still a very small company, then how do you get yourself known? If you are like everyone else, it’s very hard to get onto the radar because nobody talks about you because you have nothing … Let’s take A/B testing category. We have market leaders like Optimizely and people know VWO. The category’s inundated with tools. There’s your fresh marketer, Convert.com, SiteGainer, you name it. There’s like 20 tools and probably another 20 I’ve never heard of. Why? Because they’re exactly the same. They do the exact same thing, and they have little tiny feature differentiations.
I’m a category connoisseur in the A/B testing tool category, so I care about some minor differences between the tools for a lay person, your average marketer. For them, it’s all the same. Basically, the problem of being like everybody else is that you will not break through or you will not own the category, you will not grow because if you’re an unknown company and you’re exactly like those other companies, why choose you? Price. Often companies come with a cheaper price, but that’s not a sustainable competitive advantage because if you don’t have a long-term structural advantage, you can’t keep that as your competitive edge because there will be always somebody else coming eventually that will be cheaper. As you grow, your costs get higher and you need to go off market eventually. Basically, it’s like if you want to grow and be known and generate word of mouth, you need to be different, you need to give people a reason to talk about you, be a purple cow as Seth Godin said 20 years ago.
Louis: The consequences of being the same is really the likelihood that you’re either going to not grow as much as you think or die slowly of a very slow death. As you said, there’s a few differentiators that are not really differentiators as you said. Being cheaper works for a certain time if you’re not able to sustain this advantage structurally. From the organization point of view, maybe have a unique advantage of a supplier, or maybe you make your own products 10X cheaper than the rest and they haven’t figured out how to do it. Unless you have a very solid IP behind it, a structural advantage, being cheap is never going to last and others can achieve the same.
Louis: What other differentiators are actually not differentiators? Apart from price, what are the other ways people think of being different that are actually not worth the investment?
Peep: Features. You have this feature and the competitor doesn’t have because they will have that feature eventually. There can be a major innovation that you can be known for and you brand yourself as the innovator in this field, which is a little different, but if it’s just that, “Hey, we have more integrations than this other guy, or we have this other feature too,” again, this is not a sustainable competitive advantage because everybody will have that feature eventually, especially if it’s a feature users care about.
Louis: Okay. I think we’ve painted the picture quite well in simple terms why you shouldn’t really be striving to being the same and why you should differentiate yourself. Now, to be honest, what I’m very eager to hear from you because I haven’t talked to you about this yet and I haven’t seen you going into that much details yet is how do you actually differentiate yourself. I suspect you probably have some examples from CXL Institute and the way you thought about creating something that’s quite different, but you don’t have to use that as an example. You can use something else if you wish. Think about the people listening to this episode right now. They buy into your idea, they buy into what we’re saying, but they might struggle to say, “Okay. That’s all well and good. I can’t compete on price nor on features at least not for the long term. How am I supposed to do this?” What would you tell them? Where would you start?
Peep: I want to preface everything I’m about to say with the art and the science of differentiation is something that I am a student of myself. I’m still figuring it out. Also, in fact, I don’t think anybody has figured it out really well, which makes this field very interesting. What is fascinating, when I embarked on this journey to learn more about differentiation and sameness and so on, first step is read all the books on this topic. Lo and behold, I go to Amazon.com, I expect there to be 57 books about it. There are like three. This topic is so under-researched it’s ridiculous.
There are old classic books like Differentiate or Die, which is from the year 2000. A lot has changed. This is before the software era, this is before the internet was mainstream. It was there obviously. There’s a book called Different, which is from 2011 which is more like new things about brand differentiation. That’s about it I think. There are books that lightly touch upon it, and then there are books that are related, positioning books. Positioning and differentiation are very … There’s a strong overlap. Also, on positioning there are like two books in the world that have been written. One is called Positioning from 1981, and then the recent April Dunford’s Obviously Awesome.
That’s just as a context. Also, category creation is heavily related to it because the idea of category creation is that two steps back, 1980s, Jack Welch was the CEO of General Electric. General Electric was in every business you can imagine, thousands of categories. Jack said, “Every category that we’re in where we cannot be number one or two or have a good chance of becoming one or two, we should get out,” and they did. There’s a book with all these success case studies about it. The underlying philosophy is that if you cannot be a number one, two or have a good chance of becoming one of those in a particular category, you should create your own. Category creation is another form of differentiation. We can talk about that. Two books that I can mention, one is called-
Louis: Play Bigger?
Peep: Play Bigger. The other one is called Category Creation, which was the customer success company Gainsight. Gainsight people wrote that book. This is the stuff that I’ve been working on with. I’ve been reading all this other stuff, and just daily spending a lot of time thinking about it, and also using my own situation. CXL Institute training space, we are focused on training data-driven marketers, is also a very competitive field. It’s a market where the barrier of entry is extremely low. Any idiot can build a course and sell it, and they do. It’s super crowded, it’s maybe not as mature as some other markets, but there’s some big players in there. Of course, it’s also fragmented like Codeacademy which… Coders people, and then there’s LinkedIn Learning that teaches you everything, and there’s Udemy where anybody can put up a course from how to catch a squirrel to how to write coding. There’s various things out there.
My question when I embarked on this journey was why should somebody choose CXL Institute? This is the question differentiation should ask. Knowing about all of the options out there, why should I go with you? That’s fundamentally what we’re dealing with here. It’s about making people choose you. It’s not about marketing, getting the word out there. It’s about giving people the reason to choose. It starts with positioning in my mind where the positioning in the sense of for what kind of people are you the best choice? What is the use case for buying you and for what kind of people? That’s how you define a position in the market, and that position is in people’s minds.
People like to put other people in boxes, ideas in boxes. We like to stereotype because it saves a lot of time. What kind of company is this? Sometimes these companies are very vague about themselves on the website. It’s hard to figure out. I want to put you in a box. Is it a CRM or is it a live chat tool? What is it? I really want to know. You want to give people a way to put you in a box. What is the use case, why you, and when.
Currently, the way we are positioning CXL Institute is CXL institute is not where you go for a course or training. You come to CXL institute when you’re looking for a significant leap in your career, career transformation. This is not marketing messages. This is how we think about positioning. In order to think about your positioning, you need to know A, what all other options are, your users, your target audience, what are they thinking about and who are they considering because you need to take the position in relation to other players in the market. In our case, what we learned from research that people don’t use us. They use LinkedIn Learning or Udemy.
Primarily, we want to position ourselves against those two. We have a major differentiator is the process we use. Process can be a differentiation. In Udemy, anybody can put up a course. It’s not curated, it’s self-service marketplace. In LinkedIn Learning it’s not a marketplace, but it’s pretty much anybody can also create a course there. They are producing 60 courses a week. They’re in the volume game. We are heavily curating the instructor selection. It’s a differentiation. Also, the use case is not you come in and you take a one-hour course and learn about the topic. The use case for us is I’m looking to get ahead, I’m looking to get a serious increase in my income, in my pay, in my future prospects. I’m ready for a career transformation. Hence, the shortest thing to sell is not a one hour course which is like the default for LinkedIn Learning, but it’s what we call a mini degree. It’s like 100+ hours [crosstalk 00:23:28] through that.
Louis: That is on itself a lesson in positioning. Let me just unpack what you said so far. The field of differentiation is not very well documented. There’s a lot of … A few books on the topic or adjacent topics, positioning, category creation, differentiation, brand building, whatever. It’s true that you can’t really find a recipe or a … It’s difficult to find this kind of structure that gives you from point A to point Z the actual way to differentiate yourself. It feels like from interviewing people and talking to people a lot that some people get it or just intrinsically get it. They understand the need to differentiate and they kind of have this taste for it. They know that’s something that’s going to tick with people or not.
I don’t want to give you too many compliments because I’ve already given a few in the intro, but I think you are the kind of person who gets it. You just get it. By starting your blog a few years ago, you’ve understood that creating a blog. You knew you had to create articles that were super in depth with a lot of data and not regurgitating the same shit you just saw online to stand out. You kind of have this feeling about it. You went for it and it worked.
CXL Institute is another example. The mini degree way to position the course is very smart. You’re not saying it’s a long fucking course. You’re saying it’s a mini degree, which is you flip it on its head. You’re going to get a degree, but you’re going to spend probably like 10X less time to get it and it’s going to help you to not only learn but actually the job to be done, the outcome is to get into the next path of your career. Go ahead.
Peep: I think it’s very important that in your position and in your brand which is very related, positioning is the foundation of it, you want to be very attractive to a certain group and at the same time you want to repel another group. This is what makes many people uncomfortable because they don’t want to reject anyone, so you have to be willing to say no to some people. For instance, in our case we get daily requests for, “Hey, can I buy a one month subscription?” Our minimum is a quarter. We say no because in one month you cannot have that career transformation. We cannot deliver on our brand promise even though this person is ready to give us some money. They ask us, “Hey, can I buy a single one-hour course?”, because our mini degree is essentially a bundle of multiple smaller courses. We say no because we can’t deliver an hour brand promise and we’re saying no to some money. You need to be saying no to some money essentially. You need to be ready to do that.
Louis: This is incredibly important. I’m glad you mentioned it. This is my pet peeve with most marketers because even though you have a global brand or whatever, you cannot appeal to everyone. There are seven, closely to eight billion people on earth. If you think that your brand will touch every single one of them, will have an impact on every single one of them, you’re really mistaken by a long magnitude. Exactly. I think marketing really, and differentiation in particular, is more about picking who you don’t want to serve than picking who you want to serve. Most of the time, the ones you don’t want to serve are way more in numbers than the ones you want to serve. Making actually in your mind this thinking, “What am I not going to do? Who am I not going to serve?”, forces you then to focus on that. It’s tough.
Peep: Yeah. It’s very tough and it requires guts, and it’s scary to say no to money especially if you’re a small business and need every dollar you can get. Also, we can see this in big businesses. It’s not just about pricing like, “Hey, if you can’t afford us, we’ll say no to you.” That’s easy. Ferrari doesn’t make discounts so everybody can drive a Ferrari. It’s also let’s say clothing brands like Hollister which is a popular brand for teenage girls or so I’ve heard. Have you been to any of those stores?
Louis: I have. My sister brought me.
Peep: Okay. I’m assuming that all of their stores are pretty much the same, so like they’re dark and this loud music. They’re designed to repel the parent so that 12 year olds go in there, the 14 year olds go in there, they like it. Also, what they do is that all their clothing are small sizes only. If you’re a heavier person, they don’t have your size. There’s an ethical question, “You’re so judgmental and whatever, and body shaming and all that stuff,” and yes, we might take a moral issue with it, but also the people who fit into the clothing they’re like, “Yeah. I’m a Hollister girl.” We might judge them ethically, but by repelling a group they’re more attractive to another group. Essentially, that’s what’s happening.
Louis: Yeah. It’s a great example. It was a very bad experience for me, but my sister loved it. This is it, right? You want to repel people not only on demographic stuff, which is girl versus boys and that kind of basic gender role or whatever, more importantly you want to repel people on psychographic elements. I know some listeners make fun of me because I mention psychographic, the word, almost at every single interview, but it’s true. You need to repel people on things beyond who they are. You need to repel people on their beliefs, you need to attract people to believe what you want to believe.
Peep: Exactly. For bigger brands especially it is more important, I guess brands of any size, to take a stance on issues. Nike, I said earlier they have no functional difference over Adidas or New Balance or you name it. However, if you’re buying Nike you’re buying into the idea of I support gender equality because that’s the message in their ads, I buy into the idea that we should stand against police brutality even if we can lose everything. Again, it pisses some people off, some people are like, “Hell, yeah.” Or Patagonia. So many companies make high quality clothing for outdoors, Patagonia being one of them.
Also, differentiating by brand is all about who am I if I buy you. I’m not a category connoisseur when it comes to buying outdoor gear. I don’t even know what all the best brands out there are, but what I do know about Patagonia is that if I buy it it tells the world that I care about the environment, I hate Trump, and so on and so forth, and I’m not afraid to show it. Somebody else what might buy that. I don’t know what the right wing equivalent is for the outerwear where I support more drilling in the arctic.
Louis: But that’s what it is. Nike did this move to support … I don’t remember the name.
Peep: [crosstalk 00:31:15].
Louis: Yeah. Exactly. This guy, this American footballer who kneeled down at a game to protest against stuff. It might have seemed very ballsy of them to do so, but they knew from research that a lot of their customers are actually African Americans who believe in that. They did not take a massive risk at all. They repelled the wrong people and attracted the right ones. I want to go back to something you mentioned a few minutes ago now, to go back to more of the scientific, the rational element of positioning and differentiation. You said we’ve done our research and knew that competitive alternatives of CXL Institute were LinkedIn Learning and Udemy. What else did you try to find out and how did you get to do this research? Did you ask existing customers? And then, apart from the competitive alternative to figure out, what else did you ask them? What else did you try to know from them?
Peep: We wanted to know exactly if they wouldn’t choose us, what would they choose, or before signing up with us who else did they look at. We surveyed the existing customers who already went through this decision-making process. A lot of them were already fans for many years, which is another differentiation we can talk about, and then LinkedIn Learning and Udemy came up. Also, some people named lesser known smaller brands like Reforge or things like this. Reforge, while also I greatly admire, I know Brian before and so on, so forth, they’re also a small potato, a small potato like we are compared to LinkedIn Learning which is massive, and then Udemy is now valued at two billion dollars.
Mainly, I think you want to pick a fight or differentiate against the big guys because they control mindshare. Positioning is not actual. It’s made up. It’s in the mind of the prospect. They have some idea of what one company or another is about. The positioning is like, “Hey, we want you to put us in that box. When you’re asking what other research we did, when it comes to positioning, differentiation, that’s not … We didn’t really ask anything else. Obviously, we’re researching what people value about us and also paying attention to what are the things that people from our own sales pitches, what is the hook that people remember.
We’ve been using this phrase top 1% a lot since we started. That seems to be catchy. People voluntarily say bring that up. They’re like reflecting mirror the language that we have put in their minds. It’s clicking. It’s hitting something. We found something that is an idea that resonates with people. Of course, some people hate it, which is also even … We find even more encouragement because it’s polarizing. You have to do the factual research too. You look at the tip-top tool competitors that they’re mentioning. What are we actually doing differently? That’s another form of differentiation. It’s called attribute differentiation. Your classic example is Volvo is for …
Peep: Yeah. Safety. Yeah. They used to be at least. These days I think Volvo is also confused what they’re all about. BMW goes for the drivability, the ultimate driving machine. You own an attribute of what is the reliable version or the safe version or the green version. You own a particular attribute. Ferrari owns speed and so on. You can own a function attribute. In our case, that functional difference, the attribute difference is curation of instructors. We have a process. We ask who is the best in the world and we carefully select who’s teaching the course, which is a way different philosophy from our top competitors, which also helps us reinforce the message of career transformation, learning from the best, and so on and so forth.
Attribute differentiation is something that somebody could own as their differentiation in any category. You just need to figure out what is an attribute your target audience cares about. Ritz-Carlton, the hotel chain, while everybody owns … All the hospitality industry goes for the service, but it’s embedded in their DNA where it’s like, “We are the ladies and gentlemen for the ladies and gentlemen,” like the extreme version. I think if you go for an attribute differentiation, you’re like safety in Volvo, you want to double down on it. Maybe you’re competing, you say that our email marketing software does the most integrations. I said it earlier that’s not a differentiation. It’s just an example. If you wanted to really do that, you want to be 10X better than the next guy. You have to ask yourself, “Can I own this attribute and be way better than them?”
I recently had a chat with Hotjar people, a company that you might have heard of. There was a discussion of … Hotjar is in a space that is a sea of sameness. I can list 20 tools that do heatmaps and session replays. It’s a big problem of how are we different. The question, the idea discussed, can Hotjar own ease of implementation as their differentiating attribute? My personal opinion is it’s not a good idea because A, it’s also very easy to install every other tool. The difficulty level is exactly the same. In my opinion, it’s a table stakes feature. Maybe there is ease of implementation consideration that I’m not seeing because again, I am not a category … I’m a category connoisseur so I take it back. When you choose an attribute to differentiate on, to compete on, what I’m saying is choose carefully, analyze, poke holes in that idea. Yeah.
Louis: I’m glad you mentioned this example because actually I’ve done a lot of research on the positioning side very similar to what you mentioned. To summarize, looking at the competitive alternatives, understanding from their perspective, your people, the people you care about, not the ones you don’t care about, the people you care about, what does stick in their mind? What do they mention all the time? What do they care about the most? For the podcast, what I’ve heard time and time again, the one word that comes back to me all the time is no bullshit, or no BS, or no-fluff. I hear that all the time every time. I knew I had just to reuse that and just double down on it. I knew that some people hate it, some people hate that I curse on the podcast. Well, fuck that because the people that love me, that love the podcast, they love it.
Louis: Now, for Hotjar the slight difference is the reason why we’ve done work on ease as the idea and not ease of implementation, which is not the same. It’s that it goes beyond ease of implementation. It’s more like the ease of getting insight, the ease of getting the insight you need to create the right experiences, and as comparison doubling down on comparing yourself to Google Analytics. When you hear about alternatives, what we found out by asking the question is people don’t use a tool like Ahrefs most of the time, a tool like Hotjar. They actually use nothing. They rely on Google Analytics, and then they make guesses.
Peep: Mm-hmm (affirmative).
Louis: By telling the story of… we are basically giving you insight that Analytics can’t give you, that’s the main story, and we make it super easy to get those insights. That was something that almost every single customer we cared about said. That’s how we picked that as the story. Now, more work in required, and I’m glad you mentioned it because it is the discussion we keep having.
Peep: If you’re comparing to Google Analytics, technically these are separate categories, then you would be selling to people not very familiar with the category to begin with or the alternatives to FullStory and whatever other tools. Frankly, not to diss but I find them all easy to use. I think easy to use is like table stakes. I expect software to be easy to use, I expect that I don’t have to read the manual, that I log in and I get it. If you fail that test, you have no hope.
Louis: Yeah. This is why I think when you pick a differentiation as you said from the start, picking the right alternatives to compare yourself against, turns out that in the market to talk about this category of the Hotjar, the heat mapping tool, behavior analytics tool, turns out that I think only 10% of companies with an Alexa rank of less than 10 million, meaning the top 10 million sites in the world, only 10% use a tool like Ahrefs or Hotjar. You’re basically competing as 90% of people have never used a tool like yours, so you need to convince them to start using you. By knowing the alternative, then it’s easier to tell the story. Now, for people like you who are experts in the industry who know their stuff, just saying that we give insight that analytics can’t give you is not enough, saying that we’re easy without any proof or anything like that is not enough. The story depends on their maturity [crosstalk 00:42:35].
Peep: What you’re saying is that this is not a mature category, but there’s another differentiation idea which is that you are number one, meaning that you are the leader of a category.
Peep: I don’t know if Hotjar really is the leader. It holds a lot of mindshare for sure.
Louis: Yeah. Hotjar is the leader by a long mile in terms of market share. This is another thing I wanted to talk to you about that you hinted at before without talking about Hotjar too much, talking about you as well as CXL. This is the same story. You mentioned that a lot of people pick CXL Institute because they knew you from a long time, they were reading your posts, your blog for years ago. They might have been a client of your agency, etc, etc.
Louis: Tell me more about this. In my opinion the ultimate differentiation, which is this [inaudible 00:43:29].
Peep: Differentiation as I said in my view is the reason to choose you over these other guys. If I follow Rand Fishkin and the Whiteboard Fridays, I might choose Moz as my SEO software just because I like him. Even though he’s not with the company anymore, I still might choose him because SEMrush I don’t even know who the SEMrush person is. I like Tim from Ahrefs, so I might go for that too. My main point is knowing the humans behind it is a reason to choose somebody. Basecamp founders, authors of many books, very vocal on social media about all kinds of issues including politics, and again through that, through their world view I respect them. I might choose Basecamp as my CRM as opposed to Monday.com that advertises to me and has seemingly bought up the whole inventory on YouTube, so just the personal brand as the reason to choose.
Peep: We see that Tesla, Elon Musk, which is the greatest car person brand thing since Henry Ford, what other car people can you name? Who is the CEO of Nissan? Actually, Nissan now since the escape story from Japan made some news, but for whole different reasons. Bill Gates, Steve Jobs, founders and CEOs of big ass companies are still at the forefront and the faces that … You can put a human face to an anonymous corporation. I think if you’re marketing your company and you’re anonymous where just Squadcast, choose Squadcast, quality podcasts, it’s like I don’t know. I don’t know any other alternatives to Squadcast or anything about Squadcast really, but if they had a cool guy or girl I might choose them because of that. That’s definitely a way to differentiate.
Louis: You’re associating the brand recognition with a person. In the space of marketing and conversion rate optimization and growth, a lot of people we know you as well will associate CXL with you and you have strong point of views in a lot of issues, and so therefore people might connect or not with your view. Is there… apart from having a person representing a brand, you gave good examples of that, do you know of any other situation where a company can actually differentiate itself from this kind of very deep emotional bonds without using an actual person? Can you remain personless and have a strong brand that people have a lot of affinity for?
Peep: I don’t know really. People are passionate about clothing brands that are not associated with humans. I know people who are happy to wear certain shoe brands or clothing brands. I think it is possible. It’s just harder. It’s just a harder game to play and requires a lot of money. If you look at the most influential brands, they make various lists, you see a lot of Procter & Gamble brands there. This is made with money, decades of buying ads. That’s a game that you can play and win with money as well, but if you don’t have money or you don’t have as much as Procter & Gamble, I think it’s relatively easy to put yourself out there. You don’t even need to be the founder or the CEO. A good example of that is Dave Gerhardt who was formerly VP marketing at Drift, and now not anymore at Drift but because he took such great care of building his personal brand and associating that with Drift, again people like Drift maybe more than Intercom for that reason. Now he’s at Privy. People don’t really know what Privy does, but they’d probably like it because of Dave.
Louis: Yes. It’s another good example. I think brands, to answer this question as well from my side, the brands can use potentially celebrities, and do use celebrities and people who believe in the same thing to represent them as well. I think Nike does that very well. It might not be as effective, but I think if you do it very systematically, it could have the same effect. And then, the other way is spending millions and millions and millions of money in advertising to build affinity, which is a strong emotional and psychological principle of the more people see you, the more they tend to like you.
Peep: Absolutely. There’s strong research out there. There’s this book called How Brands Grow by Byron Sharp which is a professor that has very strong opinions and has created like a cult following, and there are also lots of haters and people disagree with him vehemently, but basically one of the key ideas from his book is that market penetration, market share is far more important than differentiation. You buy that with ad dollars essentially. If you’re number one or two in your market, you don’t need to be different. It’s [inaudible 00:49:49], and then what is more important at that stage is distinctiveness. Distinctiveness is that you look way different on the shelf of a supermarket so I can pick out your product, so basically owning your brand colors and so on.
Peep: I think with money you can escape the differentiation thing. I think Monday.com is an interesting recent CRM example. I don’t know anything about how successful they are, but they raised this recent round of money. I checked on Crunchbase. It was something around 150 million dollars. Suddenly, it seemed to me that they bought the whole YouTube ad inventory and then some so everywhere I went, Monday.com, Monday.com. Suddenly, what I started to see qualitatively is that Monday did enter the very limited consideration set of CRM tools. When people are discussing usually oh Trello, Airtable, Asana,” suddenly Monday.com is an example of a tool that people would consider.
Peep: Of course, if you log into Monday.com it’s not that different than some of the other tools. Recently, I had this experience of a new CRM tool that doesn’t advertise. It’s called ClickUp, and that actually was a different product. I was impressed.
Louis: Yeah. You can buy your way into that. It’s very difficult to remove you from the first place because your friends know about it, your colleagues know about it, and it’s kind of the go-to thing and enhances your brand. What I would recommend if you’re still listening to this episode, I’m sure you are, if you’re listening to this right now try to think of the last six months of what brands or companies entered into your mind and like are top of mind and why they are top of mind, how did they do it. You mentioned Dave Gerhardt. He’s on top of my mind almost all the time. I haven’t talked to him in a while. He’s posting on LinkedIn every single fucking day. You’re also on top of mind because you’re posting on LinkedIn almost three times a day at this stage. It actually is working. It actually is working.
I would recommend people to think actively, as you said qualitatively as well, of how are you actually influenced. You’ll be surprised that you might be influenced very simply by just seeing the same person, the same brand every single day and you start building affinity for it, and therefore liking and therefore more likely to considerate to buy or to chat or interview on a podcast.
Peep: Exactly right. What I’m doing on Twitter and LinkedIn is I’m consciously doing this for building brand awareness and reach and repetition essentially. I’m consciously trying to increase my LinkedIn audience and measuring the reach of my messages and so on, so forth, to again give people another reason to choose us. Differentiation is a combination of all these factors. It’s a reason to choose you.
Louis: I’ve seen you. I noticed it.
Peep: Thank you.
Louis: It’s working. I want to be conscious of your time. We’ve been talking about differentiation for a while, but I really appreciate you talking about it and being open about the fact that you’re not an expert in it even though I think you are, but at least being open about that and giving so many examples, so many resources to check. I have one last question before I let you go. What are the top three resources you’d recommend listeners today? It could be about the topic of differentiation, although you mentioned a lot already. The top three resources could be books, training programs, podcasts, conferences, whatever.
Peep: Okay. Besides the differentiation books that I already mentioned, if you are a business owner or a manager, the book that really hit home for me is called Road Less Stupid. I even attended the guy’s workshop end of 2019. That book blew my mind. It’s super useful, which is rare because most business books are like, “Yeah. That’s kind of nice.” That book was really, really, really good.
I’ve been actually digging in the classics recently like Jack Trout who I think passed away by now, like Differentiate or Die, Positioning, and there are multiple other books, The 22 Immutable Laws of Marketing. There’s some really good wisdom if you can get past the outdated examples and just contextualize it again. You’ll find a lot of gold. Finally, I’ve been on a branding research as well reading a lot of books on branding. If you want to learn more about branding and brand management, there’s a trilogy, all very short books that I would recommend by Marty Neumeier, The Brand Gap, Zag and Brand Flip. You can read those in a weekend.
Louis: Excellent. Thanks so much for the resources. Obviously, CXL Institute contains many training programs, mini degrees, courses on digital psychology, conversion, acquisition. It’s really good stuff. Hotjar is actually paying for the courses [crosstalk 00:55:24] in the next few weeks. Where can listeners connect with you, learn more from your, apart from LinkedIn?
Peep: LinkedIn, Twitter obviously, CXL.com, Copytesting.com, it’s a new startup. Hopefully, in 2021 on the book shelves of Barnes & Noble because I’m writing a book on differentiation.
Louis: You are? Interesting. Okay. Let me know about it. Peep, once again thanks so much for your time.
Peep: Thank you.