Differentiate or Die
Sounds pretty harsh, doesn't it? Well, I can tell you from personal experience with both my own business and with my clients, "differentiate or die" is not an exaggeration. Whether you're a small one-person shop or a large government agency, solvency and the future of your business rely on you standing out in a competitive marketplace.
Everyone is vying for the same client dollars, whether your clients are consumers, other small businesses, major corporations, or federal agencies. Your target clients are overwhelmed with too much information and too many choices. The bottom line? You still need to stand out from the crowd.
Coined by Jack Trout, the father of "positioning" products and ideas in the minds of consumers, this notion is particularly relevant for professional service firms. The problem is that your clients have a choice?and they need your help to understand why to choose your firm over others offering similar services.
And just because you currently have a client, doesn't mean they'll stay. There's a big difference between their satisfaction and commitment. Did you know that more than 40% of customers who claimed to be satisfied switched to a new service provider?1
Thinking strategically about how to move your clients from satisfied to committed is not discretionary. Differentiation is one of the most important strategic and tactical activities in which a professional service firm must engage.
For professional service firms, this is very tricky. It involves articulating the concrete value of something that, in your clients' minds, is tough to quantify. Not only do you have to catch and hold their attention in the first place, you must demonstrate the bottom-line impact your services make in their lives. Differentiation will do that for you.
What Not to Do
Before we look at differentiation strategies that work, here are some to avoid:
Banking on creativity. Vague, artistic marketing messages are a waste of your target audience's time. When it comes to building trust and confidence in your firm as the best solution to their problem, prospects want concrete, specific, direct information. Don't make them work too hard to understand your message.
There's a lot of fuzzy, ineffectual marketing going on out there under the guise of being creative. Don't be seduced by the poetic or beautiful. Do keep your eye on clearly sharing information without burying it underneath creativity.
Pricing yourself into extinction. Don't become a commodity by lowering your price to be different. When clients choose your firm over others because of price, your value fades and you're no longer unique.
The one way to differentiate yourself using price? By being the most expensive! Price becomes an inherent benefit by portraying prestige and quality. This is easily true of products (think Rolex, Louis Vitton) and is equally true for professional services (think high-end, private medical practices; financial advisors who work only with "family offices" of the wealthy).
Doing it all. Trying to be all things to all people ("our firm offers a wide range of practices") is the worst way to be unique. Not only do you overwhelm prospects with choices, you make it easy for your competitors to offer the same.
The Internet makes it particularly easy for your competition to match what you offer ? it's easy to comparison shop online. So then it comes down to who's got the better price?a losing proposition for everyone involved ? including the customer. Eventually, you'll no longer be able to afford to serve them, or will resent having to give away your services.
Choosing to be specific and narrow your offer takes courage, yet it's how to stand out in your customers' minds, and it lets you charge what your worth.
So how do you effectively differentiate your professional services? For approaches that really work, keep reading?
Taking a page from Jack Trout's book, Differentiate or Die (John Wiley & Sons, 2000), here's how to stand out from your competition:
1. Be First. A good strategy, if you've got a really good idea. If you're there first, anyone copying you later will just reinforce your value. Takes a lot of stamina to pull off and sustain.
2. Own an Attribute. Things like speed (H&R Block's fast refund) and the "experience" (a spa environment in a cosmetic dental practice) are attributes. The key is to keep it simple and focus on one or two words that describe your differentiating attribute. If someone else in your niche owns it already, it's not yours to claim.
3. Lead. If you really are #1, proclaim it! Being number one can take many forms?you can lead on sales (#1 on your local business journal's list of top firms), you can lead through technology (the fastest digital printer in town), and you can lead through performance (ranked #1 by satisfied customers for five straight years).
4. Use Heritage. Having a long history makes people feel secure. If your firm has been in business for 10 years, celebrate it! Likewise, "locational" heritage can make you stand out. Think perfume and wine from France. Government contracting expertise from Washington, DC. Safari travel planning from a long-time resident of Africa.
5. Pick a Specialty. A natural for professional service firms, this is all about being an expert. A simple example is my company, TurningPointe Marketing. We help professional service firms (not retailers, not consumer products companies, not the auto industry) attract more clients. A great way to differentiate, unless there are a lot of others pitching the same specialty.
6. Be Preferred. Do moms prefer your daycare services over others? Does the federal government prefer to work with you because you offer a discount? Does your local city magazine rank you as a preferred pediatrician? Third-party endorsements are worth their weight in gold ? if you can get them, they're a great way to stand apart.
7. Use a Different Approach. Do you make house calls? Does your firm offer untraditional hours of service? Think about what your ideal client really needs that others aren't offering, then do it.
8. Be the Latest. Technology companies have this nailed ? every year a faster chip or bigger system replaces last year's model. Can your salon offer the newest advances in skincare? What about the latest approach to data security? Whatever it is, make sure it solves a real problem, doesn't mess with tradition, and truly is a better solution.
9. Be Hot! If you just got a great review, an industry award, or your story covered in the press, leverage it. This also works if you're solving a problem or aligned with a good cause. The key is to be truthful and to spread the word quickly.
How do you know which strategy to go with? Look at the market context of the moment. If other firms "own" a certain differentiator already, don't go there. Pick something else. Then offer your proof and communicate it broadly both on- and offline. It's about being logical first, creative second. Do this consistently, and you'll clearly stand out in the crowd.
Helping professional service firms attract more clients, stabilize their business and take their practice to the next level.
1 Trout, J. (2000). Differentiate or Die. New York: John Wiley & Sons.
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(c) 2004 TurningPointe Marketing, Inc. All rights reserved.
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