Differentiation is the Key And Not Guaranteed

Differentiation is the Key And Not Guaranteed

We all know that identifying our market focus helps us to serve our clients with better insight, thus increasing our margins and retention.   This shows up in conversations often in statements like these: 

“Our target market is different than our competitors.”

“Our customers do NOT buy on price.” 

These are the types of comments that are wonderful to hear if in fact they are true to a secondary and tertiary level.  These statements can mean that my organization or Team understands that we cannot be all things to all people – which is obviously where we want to be. However, there may be some traps in this area.  What if… our competitors are watching us and developing a better offering within our target market?  What if our competitors are bringing more and more value and thus not relying on price?  Uh oh. 

It is a balance.  Leaders in any organization must be cheerleaders on these themes of focus and differentiation, but there is a “watch out”.   On the surface, these statements declare that you are different or a better choice than the rest of the market, which is the goal.   But a crutch can develop that can grow from these same declarations if not supported by specific and unique factors that can be verbalized and supported by every member of the organization.  Without that, we run the risk of undermining our own credibility and sucking value out of our client relationships. 

I recall there was a television advertisement several decades ago that showed a company building with a huge marquis proudly proclaiming: 

We’re Number #1! 

Then some time goes by, bad weather passes through and the marquis commences atrophy – parts of the sign fall off and it ends up looking like this:  

 We’re Numb____!

If I had to name this I would call it “isolated differentiation”.  So, what the heck is “isolated differentiation”?   I promote to you that “isolated differentiation” occurs when a Team of people are all well-meaning, intentional and believe what they are promoting an accurate depiction of strengths.   The issue develops, however, when the Team is not challenged to the point where they can SUPPORT the differentiation or value proposition in all environments and, thus, stand up to true and real world objections or pushback.  In this definition the breakdown is dealing with the supporting elements such as: 

“Tell me why… exactly…. you are better at serving X market needs vs Y competitor”? 

“How, exactly, do you do x or y service differently”?

We must do every Team member the service of preparing them for these types of challenges.  It is these environments that actually help us to update and refine our positioning and identify more keenly how we are differentiated and more capable of serving a particular market segment.   You know what they say: 

A knife only sharpens when held against a rough stone”! 

One more example – and this one is likely my all-time favorite.  I worked in an organization that had a full portfolio of technologies and the company’s market positioning and differentiating value proposition was as follows:

The technologies all share data seamlessly, thus relieving the administrative burden from the client, thus allowing the client to focus on their business versus managing these heavy data movement tasks, thus allowing the client to make more money, thus becoming a more valuable enterprise.”  

Makes sense yes?    Only one problem – the integration was not fully functional, so this company has a sales function promoting what they believed to be a valid value proposition when in fact it could not hold up under serious scrutiny.   And even worse in this example the negative impact was not only seen in client attainment/retention, but it eroded the core trust paradigm within the company itself.  It became a running joke that we were “integrated to the brochure level”.   What a shame.  It did not have to be this way.

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