Chances are, you aren’t the only business offering your product or service in your area. If you have competitors, it’s worthwhile to take a look at whether you have something that stands out enough to attract people to your business. This process is called differentiation. It’s not as much about competing for clients with other ‘like’ businesses as it is offering potential clients a specific reason to choose yours. Here’s how differentiation could work for you.
Determine where you are truly different from your competitors. This is the easy part. You probably already know this, but it wouldn’t hurt to do a competitive analysis on how your product or service differs from others on the market.
What makes you different ?
Be as specific as possible and come up with as many different things as you can. If you sell a software product, are you the only company who also installs and trains on the software? If you are a graphic designer, do you offer brokering of the print process as part of your service? If you do car repair work, do you provide courtesy cars with free pick-up and drop-off for your customers? Does your retail clothing store have an in-house alteration service? Figure out what truly sets you apart from your competitors.
Why do customers choose YOU?
Think about how what you do benefits your customers. It’s not enough to simply determine where you are different, you also have to figure out how to make that difference matter to your customers.
Look at your list of what makes you different and think of the specific benefits each may have to a customer. For example, what is the benefit of offering installation and training on the software you’re selling? It saves time – the customer doesn’t have to look for someone else to do the training. It saves money – instead of wasting hours trying to learn from a manual, your training will assist in decreasing the learning curve. It shows commitment – you’re not just going to sell and run, you’re standing behind your product and establishing a longer-term relationship with the customer. Are they then more likely to also purchase your support package? Probably. You’ve already given them three reasons to. So take each difference you’ve listed, and come up with three benefits to your customer that those differences provide.
Anticipate customer problems and needs.
The more accurately you can predict what your customers’ needs and problems might be, the better you will be able to deal with objections that come your way, and the stronger your position will be. Take the example of a graphic artist Sally. Sally knows her clients appreciate the design work she does for them, but has noticed their frustration in having to deal with the print process once her service is done. Her customers spend considerable time getting quotes from different printers to determine where to go. They don’t understand the language used in the print process, and often end up getting proofs that do not fit their specifications. In addition, they have to spend time running back and forth to the printer to look at proofs.
Now that Sally has anticipated the problems, she can differentiate herself from other designers. Since Sally is familiar with the printers, understands the language of specs, and knows generally which printer specializes in what type of job, she can offer to manage the print process as part of her design service. It takes very little of Sally’s time to add a valued service, and suddenly, Sally stands out.
Stay focused – do what you do well.
In trying to differentiate your company, the temptation is to try to do everything for everyone. This in itself may be a differentiation, but not necessarily a good one. Marketing experts say it is better to do one thing exceptionally well than a bunch of things with mediocre results. Determine what you do best and focus on that. Don’t be afraid to refer customers to a competitor if they truly offer a better fit for their needs. In the long run you’re better off having them happy with what they’re getting from a competitor than trying to stretch your abilities and not being able to provide customer satisfaction.
Do you remember what your USP (Unique Selling Proposition) was when you started your business?
Is it still the same? How can you use that USP to differentiate yourself in your industry and make your business stand out from the rest?