Over the past five years, without a doubt, the most popular topic in my conversations with clients and prospective clients has been around ‘differentiation’… what they can do to stand out from their competitors. Everyone agrees there is far too much “sameness” in our industry – too many firms that look alike and sound alike all offering a range of services that are essentially the same. If you’re a prospective buyer, how do you choose?
- - Steve will work directly with executives on this issue at the Insights Leadership Conference, September 26-28 in Palm Beach - -
Some firms in our industry decide to tackle this challenge head on… and work hard to develop a differentiation strategy and then implement the tactics that support that strategy. “Hooray! We’re now different than our competitors!”
Good for you! But before you get too excited and assume that buyers will start beating down your door… make sure you know the answers to the following questions…
- How truly different are your choices from what your competitors are doing? Do as thorough a comparison vs. your competitors as you can to see how your ideas really stack up. On the scale from ‘extremely similar’ to ‘dramatically different’… your POD (Point of Differentiation) MUST be as close as possible to the latter. A ‘little’ or ‘somewhat’ different just isn’t good enough.
- How much will your clients care about your POD? Just because you think it’s a great idea… doesn’t mean your clients and prospective clients will feel the same way. Before you commit all of your resources to this new differentiation strategy, get some feedback from the marketplace. Make sure you’re moving in a direction that will resonate there. And as part of this, make sure that your PODs aren’t just seen as important, but also as believable.
- Does your new POD work from a business perspective? One final consideration before you pull the trigger… make sure your Point of Differentiation makes sense for your business. E.g. Can you afford to do it? / Can you easily communicate it (internally and externally)? / Can you operationalize the changes? Be sure your new direction is more than an interesting idea… be sure it also makes good business sense.
In an era of increasing competition and commoditization, standing out from your competitors is critical to long-term growth. But before you make a commitment to a new Point of Differentiation for your firm, make sure it works inside and outside the walls of your business.