Nearly half a million new companies are formed every single year. Some will compete directly with your company or even overlap what you offer your customers.
But even if your products overlap with a brand new company, they may not be the competition that you think they are at first glance. Why? Because a real competitor isn't established in a feature list, it's established in the minds of your prospects and customers.
If your customers think one of these new companies can provide them with a better solution to the problem they're trying to solve, then you have a competitor. And a problem.
Differentiation Is More Than Logo or Subscription Levels
When you have a horde of new competitors banging down your door, standing apart from any competition is one of the most critical factors in generating enough revenue to keep your doors open and the business growing.
It's not enough to say that you're different or throw up some copy on your website that "shows" how you're different, or shuffling your subscriptions plans around.
You need to demonstrate that your product is better, regardless of cost, than any one of your competitors.
Show how you're different, don't just tell.
Successful product differentiation is a company problem, not just a messaging issue or a graphic design challenge.
Differentiation influences messaging, overall marketplace positioning, product development, business development, sales enablement, and more. There are very few parts of your company that aren't affected by differentiating your product from the competition.
Do You Have a Product Differentiation Problem?
Internal discussions and your gut feeling may tell you that your product is unique enough to stand on its own, that the features and technology that power your product is beyond anything anyone else is doing in the industry (and you may have the patents to back up your claims).
But what does the world outside your company think about your product? Do they think it's something special that stands far above any competitor in the marketplace?
Do your customers think you're special? Special enough to continue to give you money without taking a look at your competitors to see what they're offering?
Do your customers mentally lump you and your new hungry competitors together, or do they recognize and embrace the value that your product delivers?
- At networking events or parties, do people automatically compare your product to a competitor's product? "Oh, you're just like XYZ product!"
- Are there industry blogs or affiliates writing high-traffic comparative blog posts complete with feature charts creating side by side comparisons?
- Are there high volume search queries comparing your product to your competitors' products?
- On your website, if you swapped logos and color schemes with a competitor, would your customers be unable to recognize your product and copy as yours?
If you're seeing any of these issues with your product, you have an opportunity (and an obligation) to focus on differentiation as a business and marketing priority.
4 Easy Ways to Start Differentiating Your Product From the Competition
Some marketing consultants will tell you product differentiation is a complex, lengthy, and costly problem to solve.
And they're kind of right.
But you don't need to pay a high-dollar consultant to help you START solving this problem today.
You can get a jump start on the process of differentiating your product from your competition by walking through these four exercises:
1. Identify what your product is NOT.
Sometimes, by defining what a product is not, it helps you identify the real value of a product. Examples could include a feature set, ideal customer, or even business practice.
The team at Edgar decided to invest in marketing and growth channels differently than their competitors and actively decided what they weren't going to do as a way to create a constraint, which forced them to get creative in other ways and allowed them to focus on delivering value.
2. Focus on different product features and the unique value they drive.
Not the features of your product, but the value your product drives. Customers need to see how their lives are better by using your product and promoting a .CSV dowload isn't going to cut it.
TaskEasy emphasizes all of the value points that are most important to their customers front and center, starting with price. They visually push to overcome customer objections and stand apart from other lawn care service companies.
TaskEasy has more than a handful of patents driving their technology behind the curtain - but they've also done the work (I helped them with their early segmentation and messaging) to understand their customers just want an easy, reliable, and reasonably-priced lawn maintenance solution.
3. Are you making promises your competitors couldn't or wouldn't offer?
Does your organization have a proprietary system that makes your customers' lives better? Does the technology that drives your product allow you to make a value-driven claim your competition can't?
CredSimple claims they provide a 10x faster turnaround than their competitors who are using traditional methods of credentialing healthcare providers.
This promise of faster credentialing, ties directly into the one of the most desired features their customers need.
4. Why did your customers pick your product instead of your competitor?
Not sure why your customers picked you over the compeition? Ask them.
Do you understand your customer journey and why your customers are picking you instead of your competitors? If you don't know, now is the time to start a Voice of Customer program and start getting first-person data and insights from your customers.
It's a safe bet that your company wants to deliver a better product than anything that was on the market before you showed up.
There was a drive to be "revolutionary" on some level, to shake things up, and hopefully, make money along the way. Lean into this original vision and match this vision with the problems your customers are telling you your product solves.
Differentiation can be a tough nut to crack, especially in highly competitive situations, but there are easy ways to start identifying what makes your product special and unique, even when you feel like you're swimming in the "Sea of Same." Align what makes your product special with what your customers say makes it valuable to them.
Your product features and even your brand colors can be stolen and copied by a competitor, but it's harder to steal your voice, brand, and value proposition.
How your customers think about your product as clearly, and unmistakably different is what matters most to your company and makes it easier for customers to buy from you and stick around longer.