Differentiate your Business to Boost Profits
In today’s market a product, service, or business has to be distinctly different from its competitors to thrive. In fact, in most cases you need to differentiate to simply survive. It’s not enough to offer good quality products, friendly service, and fair prices. People already expect those things. It’s how you are truly different that will make your business stand out from the rest.
So how does a business differentiate itself? You probably already have things that you do or offer that set your business apart from similar businesses. Perhaps you offer an unparalleled guarantee or offer free delivery when your competitors don’t. Or perhaps you stock a wider range of products in a certain popular category, or offer a hot line of products for which you have exclusivity in your area. These are the kinds of things that can make your business stand out from competitors.
If you don’t already have something that truly sets you apart, you need to establish one or more points of differentiation. If possible, focus upon something about your business that no direct competitor can claim.
For example, mortgage companies offer similar types of services. However, one provider might specialize in first time homebuyers and offer special first-time buyer orientations to educate them and help ease anxieties. They might also promote their extra knowledge about the various programs available for this special buying segment. Another mortgage group might specialize in investors and stress their many years of combined expertise with investor loans and tout special services targeted to the investor market.
Two quilt shops might have similar overall offerings, but one has an especially robust specialty gift section that showcases a wide variety of fun and unique gifts for quilters that feature quilting themes. Another shop might organize local quilters to do several community quilts per year to donate to charitable causes. They then position themselves locally as the “quilt shop with a heart.”
There are many possibilities for differentiation. However, it’s important to remember four important differentiation tips to ensure that you set your business apart in a way that will stimulate the best bottom line results.
1) You must differentiate with something that matters to your market. You might offer a special line of products, but if that line isn’t of much interest to those in your target market, it will do little to stimulate business.
2) You must differentiate with something not already assumed to be the case. People already expect that your products are of good quality and that your staff delivers friendly service. Plus, every other business claims the same thing, whether deserved or not. The “expected” does not differentiate your business.
3) Don’t try to differentiate on price alone. Price is very easy for competitors to match and you’ll most likely just implement a discounting strategy (and possibly a price war situation) that will leave you earning far less profit than you should be.
4) It is always best to differentiate with something that truly makes your business unique. If possible, go for area exclusivity of popular products, offer specialized services not focused upon by competitors, or focus on something equally unique.
If you need help, ask your customers for suggestions. What products would they most like to see you add or offer? What do they think you already do better or differently that might be a good point of differentiation?
Once you’ve determined your points of differentiation, promote them in your marketing. You will increase awareness of what makes your business unique, generate new business, and boost your revenue and profits.
© Karen Porter. This article may may be freely published provided all content is left intact and the author bio/resource information below is included in its entirety.
About the Author
Karen Porter is a marketing consultant with over 20 years marketing experience working with businesses large and small. With a special fondness for assisting small business owners, her KPorterMarketing.com website contains articles, tips and recommended resources specifically of interest to budget conscious, small business marketers. Subscribe to her marketing newsletter to get marketing tips and cost effective marketing ideas.
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