Differentiate Your Business

One thing that I always push hard with my clients (as well as in this newsletter), is the importance of differentiating your business from the competition. 

Without any real competitive advantage, your clients, customers or patients will more easily be courted away from you by the competition with the promise of cheaper prices or fees. 

It also makes it so much harder to win business in the first place—and then price inevitably becomes the motivating factor.

YOU HAVE TO MOVE AWAY FROM THIS ALL TOO COMMON SCENARIO AS SOON AS YOU CAN.

I have a rather upsetting true story to further highlight the consequences that a lack of differentiation can bring to your business. It concerns a colleague of mine. 

Two weeks ago, the Receiver was brought in to his business. 

This is a family owned business, started by my colleagues grandfather decades ago. 

At its height it was a £50million a year business. 

But since, there has been a big increase in competition and the fact that they didn’t differentiate from the other big players in their industry, their turnover had decreased to around £40million. 

It has of course given the family a considerable amount of wealth over the years but, a few months ago just after COVID hit the world, unfortunately the Receiver was 

brought in. The company will now be sold off, either as a whole or piece by piece as the wolves get to work.

When any business goes under, there are of course a number of contributing factors, but ultimately this terrible end game can be averted with sound sales and marketing strategies being applied to the business (as long as they are implemented soon enough). 

This absolutely includes differentiating your business from all others! 

When margins are tight (as they were in my colleague’s industry) differentiating your business from all others may not guarantee you get customers at increased prices or fees (although often it does), but it definitely means you’ll acquire more clients at the same price or fee. 

Why?

Because your differentiator adds ‘value’ to your proposition and people ultimately buy value. The difference between your business with a differentiator compared to the competition without is, as you know, what’s described as ‘added value’ and when it’s something the competition can’t match, you win and often win big. 

The alternative is too hard to contemplate, just as my colleague is having to do now. Once a very sound and prosperous business, it has been laid down by an increasingly competitive market and an unwillingness to change so they could rise above what I call the ‘cheap price plague’. 

Inevitably their downfall was scripted. If you keep doing what you’ve always done, you’ll get what you always got. Adding a differentiator a few weeks ago wouldn’t have averted disaster. 

The types of customers they have aren’t won in an instant. They take time to nurture (another challenge), but if they’d changed their approach a few years ago, the predicament they find themselves in now could and should have been averted. 

You can’t keep playing the same tune and expect it to sound different.

Cost cutting helps (they did a lot of that) but if you don’t fill the holes in the bucket and ‘repair’ the sales and marketing elements of the business, reducing costs only prolongs the stay of execution. Harsh, but true. 

As entrepreneurs, we give our local economies and our respective countries a huge helping hand (often not appreciated as such!). 

We are the most dominant force in the business world, but there’s no escaping the reality that it’s never easy running a business. 

But you can make it easier. A damn sight easier when you get your sales and marketing right. Get these two parts of your business right and it becomes fun and enjoyable. It also gives you whatever you desire in life.

Get them wrong and it’s a completely different story. Your business doesn’t deserve an obituary. Create a strong differentiator and make sure it never has one!