“Differentiation is a way of thinking. It’s a mindset. It’s a commitment.
A commitment to engage with people – not in a manner to which they are merely unaccustomed, but in a manner in which they will value, respect, and yes, perhaps even celebrate”
Youngme Moon, Professor of Marketing at Harvard Business School
Your customers will buy your products and services based on two factors:
- Price
- Quality
Your business can compete on either or both factors.
As a business, your goal is not just to maximise sales but also to maximise profits. Competing purely on price for the average SME is generally a difficult path because:
- You are always battling with your competitors
- Customers do not stay loyal – they’re driven by price
- You have to work harder to cover your overheads – rent, labour costs, etc. before even extracting your own wages or dividends from your business.
Competing on quality is about differentiating your products and services, and quality means a lot of exciting possibilities you can include in your products and services to attract and retain customers:
- Product quality itself, e.g. your coffee AND service is better than other companies
- Service quality – from the time of initial inquiry to after sales service, how does one supplier provide a better customer experience compared to another supplier?
- Does the supplier greet you a friendly helpful way?
- Does the supplier show you that they really understand your needs?
- Does the supplier delight in fulfilling your expectations?
- Does the supplier follow up to ensure that you are happy with their service?
- Customer relationship management – especially in Business to Business transactions is vital.
- Does your supplier contact you on a regular basis to see how your business is going?
- Does your supplier passionately help your business attract and retain customers?
Surprisingly, many companies only pay lip service to quality customer service!
As a business owner, think about how you can engage better with your customers, and how this can amazingly improve sales and customer retention.
Developing a unique value proposition for your customers gives you that competitive advantage and makes your business less reliant on pricing to win and retain customers.
Capstone can help you with a review of your marketing and sales strategies, and helping you in differentiating your product and service offerings.
