The 6 Most Effective Methods to Differentiate Your Business
Successful business owners differentiate their companies to effectively grow sales profitably, while improving client loyalty within a competitive business environment. Businesses that successfully differentiate themselves effectively structure their value proposition to offer features that their competitors do not offer, or they have a more efficient business process that yields cost savings which allows them to pass on the savings to their customers in the form of lower pricing.
Here are the 6 most effective ways to differentiate your business:
- Increase Your Value Perception -When customers perceive that your product’s value, stylishness, or class is differentiated, your sales increase because of your offering’s improved value proposition. Businesses often differentiate themselves by creating a perception that they offer better quality given the price they pay.
Simply becoming the lowest cost supplier can be the most ideal strategy when you are selling a commodity when you have no other opportunity to differentiate.
Many businesses find that highlighting donations triggerred by sales increases value perception because it makes their customers happy as they perceive that the business is involved in the community. According to Rachel Lamb of Luxury Daily, 20% of consumers are willing to pay a higher price when it supports a cause, while 94% of them will switch to a brand that supports a cause from one that does not.
You could also increase the trustworthiness of your brand by asking prior customers to provide testimonials. In turn, your prospective customers will understand that other customers have had a good experience with your company in the past, which will increase the value perception of your business.
Your company’s market research could suggest that you should implement a guarantee to increase customer satisfaction. Keep in mind that any failure to deliver upon the guarantee that you implement will cause people to lose confidence in your brand.
Some businesses target time-crunched customers by offering a more convenient shopping experience. In this case, extending your hours of operation or opening locations in more convenient locations may drive positive results for your company. However, business owners who deploy this tactic must analyze whether they would be profitably increasing sales as this increases operating costs.
Creating an exclusive club that offers your clients experiences only available through your business or by spending a certain amount of money each year could differentiate your business. On the same token, offering a more luxurious experience may result in customers going to great lengths to patronize your business.
- Improve the Perceived Quality or Opulence of Your Offering – Established brands could whip you out of the market because of their financial muscle and their more developed brand perception. To beat them, you need to focus on other areas apart from the price, such as the quality or opulence of your offering.
For example, a candy business could differentiate its product on taste, convenient packaging, or ingredients. As such, the consumer is willing to pay a premium for the additional value created by this differentiation. Luxury car manufacturers could associate their vehicles with class and style as wealthier customers will easily be willing to pay a higher price due to the opulence and the status symbol that the car offers.
- Service Self-Employed & Startup Businesses – Self-employed professionals and startup businesses have the most potential to reshape our world for the better, but are the most vulnerable area of our workforce and can be great opportunities to build a long term relationship with as they can be underserved. Making sure that you have relevant product or service offerings for them will ensure that your business is well-positioned for further growth. In turn, your business remains top of mind when these businesses grow as you have gradually built a relationship by offering a scaled down solution of your services to meeds their needs.
- Increase Client Loyalty – Increase loyalty amongst your clients to set your offering apart from other companies. While this starts with improving quality, there are other considerations to encourage customers to return to your business.
You could utilize marketing automation to increase the personalization of your marketing messaging. Customers who trust that you are delivering a service of superior value will be happy to provide their personal information to you. In turn, this enables you to personalize your service towards the customer, which plays a role in 86% of purchasing decisions according to Infosys. Additionally, 73% of customers prefer to do businesses that utilize their personal information to make their shopping experience more relevant. Businesses then can develop user-generated profile platforms to gain emotionally intelligent insights and customer opt-in solutions, which increases customer loyalty.
- Increase The Level Of Customer Service That Your Company Offers – The customer is always right, and it is important to ensure the satisfaction of your customers since it costs five times as much to attract a new customer versus what it costs to keep a customer. When you provide customers with a good experience, 81% of your clients will patronize your business again and will spend 9% more than a new customer. When you fail to provide a good experience, 51% of your clients will not return to your business.
- Utilize Social Media To Elevate Your Brand – Social media is a prime communication medium to express customer appreciation. In fact, 81% of clients listen when a brand executive has something to say on social media; and in turn, their confidence increases when you provide relevant information that appeals to them.
One pro tip that you should consider giving a gift or complimentary upgrade to your loyal social media advocates. While the cost to your company is minimal, it is highly likely that your advocate will post about this surprising experience which will only provide more customers and positive exposure for your brand.
Differentiating your business can be costly, but it will often result in greater long term profitability. Therefore, your marketing messaging should resonate as much as possible with your target audience in a way that creates a perception that your offering is differentiated!
Need help in growing your business? Let a highly experienced business and digital marketing consulting agency help you in the most effective manner in how you can take your business to the next level! Schedule a free consultation today to learn how to improve the differentiation of your business from your competitors today by calling us at 617-651-1457 or emailing us at email@example.com!