There is no denying that part of owning a business is understanding that you may be faced with high competition and crowded industries. Knowing how to make your business stand out and understanding what sets it apart from the competition is vital to keep your business from fading into the background.
In other words, you need to know what sets your business apart in order to sell. And once you figure that out, you’ve got to shout it from the rooftops.
What Exactly is a Differentiator?
The basic definition of a differentiator is a unique set of benefits that sets your business apart from your competition. Understanding what you are good at and highlighting those qualities shows your customers why you are worth putting above your competition and possibly spending more on your product.
Overall, differentiators give your customers validation in their purchase, and a person who feels confident in their purchase is more likely to continue purchasing from you in the future.
Types of Differentiators
Though understanding what you’re good at may sound easy, it can be tricky to figure out.
There are many types of differentiators your company can have. Some of the more popular differentiation factors are based on the customers’ experience, or perhaps the price of your product—or even your specialization for a specific target market or industry. The list goes on.
Say the differentiator for your company is the experience you give your customers and the personality of your business. If you go above and beyond to give your customers a great experience when they are shopping, they’ll remember it. Best case scenario, they tell their friends about how friendly your employees are and how great of an experience they had.
Another example could be your expertise serving a very specific target audience. Say you own a marketing agency that specializes in serving law firms. When a law firm goes looking for a marketing agency, they’ll probably appreciate finding one with lots of experience in their line of work.
Your ultimate guide to SMB accounting
Let’s get those books in order.
Questions to Ask to Help Identify Your Differentiators?
Having trouble putting your finger on what makes your business special? Don’t worry. We have some simple tips and tricks that can help you.
Ask yourself what you do that your competition does not?
This is a chance for you to do some market research and analyze how your competition works. Take a look at how they’re advertising themselves. What do they highlight most? What don’t they talk about?
Next, write down a list of everything your business does that others aren’t talking about (or that you know they don’t do well). Then, write down a list of all the ways you overlap with your competition. Writing down your similarities and differences is a quick and simple exercise that can have long-term benefits and lead to a quick conclusion of your differentiators.
Ask yourself what your customers get from choosing your business?
This is just another way of saying you have to be familiar with your customer’s experience.
Customer experience: The interaction between a business and a customer over their entire relationship.
Map out your company’s entire customer journey. What happens from the first time they hear about your brand through when they become happy, loyal customers? Putting yourself into your customer’s shoes shows you what they’re experiencing as they engage with your business—and what benefits they see. From here you can ask yourself:
- What type of customers do you help?
- What are your customers happiest about?
Still Having Trouble? Go Straight to the Source
Asking your loyal customers what benefits they get from your products or services may be the best and easiest way to find out your differentiators. Going straight to the source gives you a fool-proof and immediate answer that helps you avoid making educated guesses.
You might ask them:
- Did you meet their expectations?
- Where did you exceed their expectations?
- Why did they choose you over your competition?
- What do they like about your business?
Got Your Differentiators? Now Brag About Them
Knowing how to put your key differentiators to use is just as important as determining what they are. Communicating these with your current and potential customers will help them understand how you will help them and what your business stands for. This starts by living and breathing by your differentiators. Make sure everyone on your team knows what your business stands for and how you want to portray that through them.
The best part of understanding your differentiators is you can use it in your marketing strategy. A solid marketing plan will come in handy when capitalizing on your company’s strengths. Highlight these differentiators when creating ads, posting on social media, and talking about your brand will let people know what you stand for and what you are offering them. Also, a well-executed marketing strategy will give you a nice competitive advantage in your industry.
Overall, the real importance of having differentiation in your business is to stand out and let your customers know what they are getting when using your product. Every few years you must take a step back and reevaluate the importance and relevance of your company’s differentiators. It might change or it might stay the same but keeping it as a core to your business can put you above your competition.
Love this article? We’ve got more advice tailored specifically for business owners like you. Check out more on the ScaleFactor blog.