What is Your Marketing DNA? (Part II of IV)

Your marketing DNA consists of Differentiation, Niche and Adding value. Let’s dig into Differentiation. We’ll look at four areas: what it is, why it is important, how to differentiate and who is differentiating well.

1) What is differentiation?

Simply put, differentiation is the process in which a business distinguishes its services of products from that of other products and services in the marketplace. This must be accomplished on three levels: differentiation from direct competitors, indirect competitors and internal competitors. Successful businesses differentiate on each of these three levels. They separate their product and service from direct competitors. They communicate why their product or service is a better use of a customer’s money than any indirect competitor. And, they convey how one product or service they offer is different from another product or service they offer (this last differentiation enables tiered products or services, upselling and cross-selling opportunities).

2)Why differentiate?

If a business cannot provide a unique and special reason for customers to solicit the business, the business will not experience sustained success. Business success is contingent upon the ability to offer and deliver a unique customer experience that cannot be encountered elsewhere. I often use the analogy of relationships when communicating to my clients why differentiation is so vital. Think about the people you seek out for certain needs. You seek out an individual because they satisfy a particular need differently, more uniquely and perhaps better than anyone else. Same goes for a business. If your business can serve a particular need different, more uniquely or better than another business, customers will seek out your business now and into the future.

3)How does a business differentiate?

Isn’t this the million dollar question? And to be frank, there are a million answers. Truly, any way your business can offer something unique—and add value—is a way to differentiate. Here are a couple of successful ways that I have come across:

•Offer something totally unique: present something that cannot be replicated or duplicated, like superior service, a one-of-a-kind product or exclusivity.
•Personalize your product or service: try remembering names, creating customer profiles, hosting events, allowing customers to dictate their experience, and more
•Find a superlative: as Jack Troutman and Al Ries stated in Positioning: The Battle for Your Mind, if you cannot be first in a category, create a new category where you can be first!
•Target an underserved market: be the only gig in town for a certain market

4)Who is differentiating well?

Look at any successful business and they are differentiating well. If you still need some help finding good differentiators, consider these businesses:

•Global Powerhouse: IBM. A company that has sustained a competitive advantage for over a century must be doing something right. IBM differentiates by continually focusing on the customer. IBM sees customers as creators and collaborators, not just consumers.
•Regional Superstar: In-N-Out. Burgers, shakes and fries is nothing different. But In-N-Out has maintained strong differentiation with its customer-centric focus. The dining experience is neither McDonald’s nor Denny’s. There is a different feel of cleanliness, energy, happiness and life in an In-N-Out restaurant. In fact, it is arguably not a QSR (Quick Service Restaurant) and it is different because an In-N-Out dining or drive-thru experience cannot be duplicated anywhere else.
•Local Hero: self-service yogurt. On a local level, the self-service frozen yogurt concept is exploding. In California, for example, a number of independent shops offer a different dessert experience than a typical ice cream or smoothie shop. Marketing messages tout health and customers are in charge of their own experience. This concept is very different than other dessert concepts and is attracting much investment.

Differentiation is the first key to a sustainable marketing DNA. Tune into future posts to learn about Niche and Adding Value.