Differentiate Yourself from the Competition

The last thing a business wants is to blend in. Standing out from the competition has become one of the biggest challenges entrepreneurs face. This article will explore what a differentiation strategy is, and cover several ways that businesses can differentiate themselves from others. Before covering the ways to differentiate your business, let’s dive into the reasons why differentiation is imperative.

  1. Compete without having to slash prices
    • Competing solely on features won’t last long as commoditization causes most products and services to be almost the same over time
    • Whether your strategy is to focus on quality or experience, having a unique selling point (USP) allows your business to compete without having to always lower prices
  2. Increase customer loyalty
    • By improving the perceived quality of your products and services can increase the likelihood of consumers purchasing and recommending your products to others, thus helping your business differentiate itself and prosper
  3. Give consumers a reason to choose your business over others
    • When differentiation is done, your business is able to create a reason for potential consumers to choose you
Differentiate your business with these methods.

Now that the reasons to differentiate have been defined, here are some methods your business can use to differentiate itself from competitors.

  1. Price Differentiation
    • Differentiating your business on price means that your business delivers the highest value and benefit in comparison to the price paid
    • When you differentiate on price, you are able to maximize your potential revenue by offering potential customers a lowered price, thus increasing your product’s perceived value
  2. Product Differentiation
    • Another popular and effective differentiation strategy is by making your product or service stand out
    • It revolves around both actual and perceived differences which may include, but are not limited to, features and aesthetics
    • However, product differentiation may be short-lived because innovations are relatively easy to duplicate, causing new entrants to have a low barrier of entry
  3. Distribution Differentiation
    • Coverage, availability, immediate access to expertise, greater ease of ordering, higher levels of customer or technical service
  4. Image Differentiation
    • Make your business stand for something in the mind of your consumers
    • Build a connection between your business and the effort you work toward
  5. Relationship Differentiation
    • This form of differentiation covers the process of setting your business apart through its customer relations, reliability, and credibility

Overall, there are numerous ways your business can differentiate itself. Take the time to figure out which method, or combination of methods, would be most ideal for your business landscape.

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