Target Market Segment Strategy

The target market strategy involves isolating potential customers by revenue into three tiers, then drilling down to very specific needs via a comprehensive risk analysis.

The first tier customer, businesses with over R5 million in revenue, is more experienced in outsourcing and may find themselves more comfortable hiring more well-known security providers but may be hesitant to signing with ELSS Security because the company is relatively new in the industry. The strategy on this front will be sub-contracting with a well-known provider and demonstrating the superb service and ability of the team within ELSS led by its experienced executive director. This will help the client get comfortable with ELSS service and happy to sign a contract us. These companies also great to sign with on a retainer contract as, strategically, a retainer helps maintain consistent cash flow, even if during some months these customers may require more services than what they have paid for that month.

The second tier customers, those businesses operating at revenue levels of R501K - R5 million, typically are very excited to have moved out of the home office stage, and into a new level of stability. This client is not very comfortable with spending huge sums of money on well-known providers as these generally charge premium prices but is suitable for ELSS as our pricing is designed for the client and is negotiable to the client's favor while ensuring that we maintain our margins.

The third tier customers are much more difficult to identify, and more ubiquitous than the rest. These small businesses are operating on R100K - R500K in revenue, often are operating out of a home while their assets are kept elsewhere and they require guarding services in those sites. Again, the strategy is to provide these businesses with a short needs analysis, and focus on the quantity of such customers to maintain a solid revenue stream.

Competition and Buying Patterns

Typically, business clients will learn about the small security providers through word-of-mouth experience passed on through a friend or contemporary while large providers use above the line marketing strategies. Outbound sales teams dominate this category, and the stronger your sales team and name recognition, the greater your odds of finding clients willing to place your company on retainer or accept your company's bid.

While the dominant players in this market tend to have some of the best sales teams in the industry backed by many years of experience, that is, people who know not only how to communicate to the client, more important, is a company's ability to follow through and execute on promises made and provide accurate, industry specific information that is useful to the client even before the deal is made. This is our key differentiator as we are more ambitious than anyone we have interacted with on this front, particularly among small providers.

Price is also important, and operates on a complex tiered system that is dependent upon the effectiveness of a particular salesperson, the word-of-mouth advertising already in the mind of the potential client, and the perception that the client has of the provider. The ability for a company to keep its cost at their lowest while providing high quality services, including the remuneration of staff, is critical in making sure that the price is right for both the client and the provider.

Strategy and Implementation Summary

ELSS will pursue a strategy in line with the experience of the owner, and implementation will be performance based and follow a clear path. Milestones are important to the implementation of this plan, and so is the vision and the will of the company's owner. The overall company strategy is tied very closely with the sales strategy, that is, with the front lines of the business. One of the biggest threats to any strategy is that they can become too high-minded, and not literal enough to translate into action.

Competitive Edge

ELSS does not claim to have a significant competitive edge however in the following areas we definitely have some advantage over our competition:

• Access to human resources that have already been identified as top performers in their field.
• Customer service mobility - As a customer-centric firm, ELSS offers no hold phone lines, same day email responses, and callbacks within one hour.
• Risk Assessment service - to advise potential clients of the minimum security requirements even if they are not our clients as yet.
• A considerable network of contacts across the industry such that are would be very few services that we cannot be able to offer or arrange for our other partners to provide.

Marketing Strategy

ELSS' marketing strategy take on a vertical approach. This approach looks at building deep relationships with fewer clients that last longer as opposed to many clients with shallower relationships. The latter strategy can have an organization to spread itself too thin as it may have too many clients and compromise the quality of the services and relationships in the process.

A vertical approach is about offering above average services and building good relationships with the clients and interacting with them at a much closer level that both client and provider can pre-empt each other's next steps enabling great synergies to flow between the two.

For ELSS, the saying "less is more" is not just a saying but a motto as it relates to the number of clients in our books.