Do you wonder whether differentiating your company will yield a significant ROI? Maybe you wonder whether your company can be differentiated at all.
Most owners, presidents, and CEOs would agree that the short answer to the question “Does Differentiation Add Value?” is “yes.” So, then the focus moves to the question behind the question: “Is Differentiating Our Company Really Worth the Time, Energy, and Money?” Not everybody would answer “yes” to that question, and, in rare cases, they might be right.
In nearly 30 years of helping businesses and professional services firms grow the topline, however, we have yet to come upon a viable business that cannot differentiate itself in meaningful—and revenue-generating—ways. And companies and firms whose business developers know how to communicate the value of that differentiation increase their odds not only of selling more of their product or service but also commanding premium prices.
Just how does that work? Here’s how three of our clients make differentiation work for them.
#1: Creative Thinking. One client that supplies a pure commodity to dealerships turned its product into an important customer-retention incentive for those dealerships. This commodity had already demonstrated its contributions to effective product maintenance. But after our client helped dealers reposition our client’s product—without changing its function—continued maintenance at individual dealerships became much more attractive. The incentive was simply adding, in effect, a rider to the factory warranty on the product sold by the dealership. Once that incentive began to result in customers returning for new purchases, demand for our client’s product increased a lot.
Key Point: Keep in mind that demand for this client’s product increased, even though it was still a commodity. And still is, for that matter. Differentiating it so that it added new value for the buyer made it a star.
In this industry, we were told, continued service at the original dealership translates into increasing the odds by about 20 percent that customers will then purchase the same product—or the latest rendition—at the same dealership. Why? A couple of possible answers are (1) that continued good service increases confidence in all aspects of a dealership, including new versions of products. And (2) positive customer interactions build loyalty, making it easier to stay with a supplier and harder to switch.
A next-level and more complex differentiator our client developed was to create a captive insurance firm to cover the risk of extended warranty claims. Our client has seen steady growth over 20 years thanks in part to the work they put into differentiating themselves.
#2: Tapping Customers for New Products. Many companies pay lip service to using their sales forces as research arms for product development. In our experience, few really do. Why? Because doing it right and seeing a return does take additional effort and patience, mainly in the form of Consultative Sales Training and consistent processing of the market intelligence the sales force provides. But the payoff can be a significant, and sometimes sustainable, competitive advantage.
Two of our software-related clients differentiated by making their salesforces the front end of new product development. We taught them how to use a highly productive discovery process to identify problems that had no current solutions in the marketplace. To smooth the way, we included a process that filtered the new problems so that product development was not overwhelmed by underwhelming ideas. This same competitive advantage—created in different industries—helped our clients become the fastest growing in their markets.
Key Point: Isn’t using your sales force for market research just commonsense? In a business-to-business environment, who has the most significant regular contact with customers? Usually, it’s the sales force. The caveat here is to make sure that the research is a productive part of the sales process itself, not an annoying add-on salespeople will resist using.
Our FOCIS® Consultative Sales Training course, which these clients completed, teaches both sides of the equation. It can improve the performance of just about any salesperson and put others on the path to becoming top producers—the 20 percent of any sales force that consistently brings in 80 percent of new sales.
#3: More than One Right Answer. A residential real estate photography firm we began working with just last year has gained competitive advantage using four differentiators: geographic reach, fast film processing and delivery, media variety, and training in quality. That sounds like a lot, but they all work together toward one end: improving the efficiency of a real estate broker’s ability to sell a listing. Getting more potential buyers to visit a property faster is critical to getting a sale. And photography has traditionally been critical to making that happen because buyers want to visualize themselves as owners—in other words, turning a house into a home. This last pandemic year has made visiting properties in person much more difficult and photography much more important, especially video photography, or videography. Our client offers both.
Our client is probably the only such firm that works with photographers and videographers throughout the U.S., making it an ideal vendor to large, national real estate brokerage companies. They know they’ll get the same, high-quality service wherever their offices are located. To ensure uniform high quality, our client trains the photographers it works with “personally”—that is, at its headquarters—in the specialized niche of real estate photography. Fast delivery is also ensured because our client operates its own processing services, often with one-day turnaround. Local services can take up to three days.
Key Point: Still another differentiator this company uses is the process they developed in our consultative sales training course FOCIS®, where they learned how to communicate the differentiated value of their services and get paid for that value. (Note: Just telling a prospect that your product or service is the best solution doesn’t work nearly so well as persuading them. That’s what FOCIS® teaches—in person or on a video platform. We adapted and differentiated, too, and can now help our customers improve their sales performance just about anywhere without the cost of being “on site.”)
If your sales team needs help better communicating the value of your differentiation, please consider taking our FOCIS® Consultative Sales course. And if you feel your company or organization can’t identify its differentiators or the ways they add value, check out our FOCIS® Differentiation Workshop. Our proven process can help you think about new ways to gain competitive advantage, often sustainable, and put them to work to grow your topline.
Just get in touch at 847-446-0008 Ext. 1 or pkrone@productivestrategies.
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