How really different is your business?

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Your answer should always be: Not different enough

Many entrepreneurs, when starting out, try to convince their clients that their business is one of a kind, and nothing else like it exists – sometimes they even begin to believe this themselves.

When entrepreneurs are asked what makes their business special and different from their competitors, usually, they give the evil trio of clichéd answers, such as: “I’m more creative …”, “I offer a personal touch …”, “My services are cheaper …”.

These three differentiators are the most common ones given when asked this question. They are also the worst possible differentiators, because too many business owners feel the same way about their business. If your competitor also claims to have these differentiators, what makes your business truly different from theirs?

If your main differentiator is that your business does things more creatively than your competitor, how do you prove that? You may believe that you do, but this is a subjective belief.

 

If your business offers personal service – with your personal touch – how do you prove it is better than your competitor’s service offering? When you rely solely on this key differentiator, it could inhibit your business’ potential for growth, because there is a limit to how much personal service you can give. As your business grows, you will never have enough time to ensure that every client gets service with your own personal touch (unless you are a genius at systematizing your personal service – which few people are). Personal touch is also subjective, because people have very different views on what they would classify as great personal service.

Offering cheaper services is a temporary situation, because you could offer a product for ₦1,000 today, and a competitor could offer the same product for ₦900 tomorrow. If you only use price as your differentiator, it’s a race to the bottom because someone will always be cheaper.

In order to shift your mindset, and therefore your business, you need to be honest with yourself about what really makes your business special. Once you’ve answered this question honestly, you then need to look at your current resources and decide on what your business’ core competencies are, and what you want them to be.

It’s vital that you, the entrepreneur, spend a disproportionate amount of time, effort, and love, building up your business’ core competencies to ensure that you are truly different from your competitors. If speed is your core competency, it needs to be ingrained in your business’ DNA, and must permeate every aspect of your business. For example, the speed at which your business answers the telephone, assists a caller with a query, deals with complaints received on social media, and delivers goods your client has ordered.

Focus on identifying up to 4 key differentiators (you can’t rely solely on 1), and always keep in mind that your business’ core competencies have to serve your clients at the end of the day. If they don’t, your clients will no longer support you and they will go to your competitors.

Once you have decided on how your business is going to be different, build on that. Differentiation will allow you to build margin, which will also drive sustainability – but this is also only temporary because your competitors will be copying you. For that reason, you need to be relentless when differentiating your business, and make this a goal that you continually endeavour to achieve in order to stay one step ahead of your competitors.

Ask yourself

The secret to shifting your mindset and therefore your business, is asking yourself the following questions, and answering them honestly:

  1. Is my business truly different?
  2. Why isn’t it different?
  3. How could I make it more different?
  4. What do my clients perceive as being different?
  5. What different services are my competitors providing to my potential clients?

Adapted from RaizCorp

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