Why is it important to differentiate your business?
Look around you at your marketplace, are you the only one selling what you sell, or doing what you do? The chances are that there is at least one other business providing the service or products that you do. What separates you from your competitors? Why is it important to differentiate your business? This article investigates these very questions.
“Be yourself, everyone else is taken ” – Oscar Wilde
If there is no one else selling what you do, be sure that if you are a success, others will copy you and follow you into the marketplace.
Being first to market is an advantage, but maintaining that lead is difficult. Google was not the first web browser to enter the market, but they certainly dominate it now.
Why should someone buy from you and not from the other person offering the same or similar product or service? If you don’t know, then it is unlikely that your customers will know. Their buying decisions will be based on nothing more than chance.
Let’s start with the customer
What is it that he/she wants from you? Do you know or are you selling what you are good at doing or making?
People don’t want to buy a drill, they want to buy a hole – or ultimately, a shelf to put things on, and why do they want a shelf? Probably to be more organised, or to display their newest golfing trophy. The drill is a means to an end – something they need to get to what they really want.
Anyone in pain doesn’t want to buy a pill or a therapy, they want to obtain a better pain-free way of life which will enable them to do all the things they can’t do now.
People make choices based on emotion but backed up with logic. As a business owner, you will need to know what emotion you wish to tap into and have all the facts and figures at your disposal to verify their emotional response.
Now let’s look at your competitors
Why do you see them as competitors rather than potential collaborators? What customers do they have that you want? How do your products or services differ?
List all the things that they do really well, and then all the errors you see them making.
You are obviously not going to share that information with them but use it to learn how you can do business better. As in warfare, knowing your enemy is the surest way to knowing yourself; a thorough understanding of the marketplace, the players within, and their strengths and weaknesses will allow you to succeed.
When you have worked out how you are different from your competitors, make sure that you incorporate that into your culture, your strategy, and your marketing. Above all don’t stop, keep learning, innovating, and communicating.
“The only sustainable competitive advantage is an organization’s ability to learn faster than the competition.” ― Peter Senge
Why is it important to differentiate your business? Here are some examples of competitive advantage that have stood the test of time:
Apple has built a strong brand based on an ethos of disruption to the market place, challenging the status quo and producing quality products that outperform their competitors.
They have built a strong, loyal customer base that will always buy ‘Apple’. Apple’s policy of constantly developing innovative products that share the same operating system, software, and applications means that customers buy across the product range and do not pick and choose with other products from other suppliers. This policy also minimizes the risk, timescale, and costs of product development, enabling the company to introduce a stream of new products and stay ahead of competitors.
Coca-Cola is successfully positioning its products as happy, meaning that they bring joy, harmony, etc. Coca-cola doesn’t sell a fizzy drink, they sell happiness in a bottle. They are also a global company whose logo and name are familiar throughout the world. They position themselves as accessible to everyone and their financial strength allows them to price accordingly so that only the supermarket home brands are cheaper. Coca-cola has a large product brand and is constantly adding new flavours and products to the market. Coca-cola also invests in its people, their learning and development and uses innovative HR solutions to keep great staff.
Nike is a customer-oriented brand and customer loyalty is a strong source of competitive advantage for it. The company has employed several methods to increase customer loyalty. Apart from investing in design and quality, the brand has also employed a great business strategy and focused on customer service. Nike started life as the underdog but by knowing their customer, getting great processes in place within their supply chains and manufacturing as well as developing a strong, wide product range they have become dominant in their field. Their marketing is innovative and emotional, creating culture rather than just selling shoes.
Why is it important to differentiate your business? I hope this has inspired you to understand exactly why and the positive impact it can have on your business.
Thinking about having business coaching? Take a look at our coaching programmes
or apply for a complimentary coaching session
