The Power of Core Value

For a number of years the web was ripe with marketing inefficiencies (read, opportunities.) Some companies were built on arbitrage plays as affiliates or as product companies filling a void in niche markets. These companies relied on pockets of low acquisition costs, maybe a super cheap remnant CPM or uncontested pay-per-click terms. Although some of these opportunities still exist, the best categories are taken, and a shift away from media spend on mass advertising is squeezing out any differential in converting inventory.

Recently, I helped a client negotiate what I thought would be a challenging CPA deal because of the price expectation imbalance illustrated in a volley of emails between our client and a publisher, leading up to the talks. I prepared every data point possible based on about a half a dozen scenarios, including various combinations of percentage share of voice, data sharing, ad formats, email frequency, transaction process and touch-point control. I noticed the principal representing the publisher becoming a bit agitated just as my client started talking about how they had cornered the market.

This was odd. A bit of frothing (whether real or feigned) might be typical when the deal numbers are being discussed. But we hadn’t discussed any numbers yet, and the principal of the publisher was a seasoned deal-maker. Such visible reactions were out of character.

My client finished a clear articulation of his unique service and was about to broach the numbers in an attempt to set a realistic anchor. But the publisher interrupted to say, “Whatever it is, we will find a way to work with you.”

Excuse me? Did they really just say that? In a nervously enthusiastic follow-up to the unexpected, they went on to say my client’s product was something they felt the market had needed for a long time and that they had even tried to bring something similar to market at some point in the past. They weren’t reacting to the deal; they were having major “I-missed-the-train” pangs.

If you have a compelling and differentiated product that fills a need, don’t underestimate the power of your position.