際際滷

際際滷Share a Scribd company logo

Differentiation

Download as DOC, PDF
Bert Shlensky
Bert Shlensky

This document discusses differentiation and how start-up businesses can differentiate themselves. It explains that while theories of differentiation focus on branding, quality, and marketing, start-ups face different challenges competing in crowded markets. It emphasizes that differentiation requires that customers understand and care about the differences, and that businesses must communicate their differences effectively with limited budgets. The document also cautions that perceived differences may not actually matter to customers if the features do not provide meaningful benefits.

1 of 2
Download to read offline
Differentiation: What is it and how do we do it? Most of us understand the marketing concepts of differentiating ourselves from commodities. This can be accomplished by various actions including creating brands, quality , packaging , marketing , social and web marketing , distribution , service, convenience , education , serving niches, etc. . The purpose of these efforts is to avoid making price the main marketing tool and always being vulnerable to the next guy being lower. The theories are great. However, I am frankly tired hearing about the success stories of Apple, Coke, Ritz-Carlton, Nike, Whole Foods, BMW, etc. Most of these have been around a while, have lots of marketing money, are huge, are the leader in their industry or segment and really have created something special. I and believe most of us live in a different world. I have counseled almost 400 start-up businesses in the last three years and their issues are far different. They include restaurants, T-shirt companies, fitness centers, yoga studios, apparel companies, internet marketing companies and various services. For example, I live in NY and it seems like there are 2 pizza parlors, 2 nail studios, a Starbucks, and 2 bars or restaurants on every block. I find clients are frequently excellent at describing how they perceive they are different. For example the best section of many plans is the description of the product or service, the expertise of the company and how great they are. In contrast the weakest sections of the plans are frequently analysis of competition, market research, marketing plans and distribution plans.. There are, however, three areas where one can focus on differentiation in order to achieve greater success: How are you different? Do enough customers care about your difference? How can you communicate your difference? Does the consumer understand or care about their differentiation. Frequently we think we have something special and the consumer either doesnt understand o care. For example: I love everything about Costco and dont care about the large packages, any service, any bags and little selection. They have what I want , it is less expensive than others places, I find things there that are fun and they have great hot dogs In contrast I drink wine but have no interest in fine wine. no matter how much you tell me I cant tell the difference between a $ 10 and $ 100 bottle of wine
Special service can be a big differentiator. I love great hotels , the deli where they know me and what I like , and even my gym where they are very subtle in asking me to move from the fast lane to the slow swimming lane when it gets crowded by saying you will be more comfortable These illustrate two critical concepts in differentiation. Can the customer tell or care about differences? While many women will crave expensive new shoes or purses, many men wont buy new shoes until the rain comes through the holes in the soles except their basketball shoes. For years marketers spent millions teaching consumers that coke and Pepsi or different vodkas are really different. Another issue is what quality is. Clients will talk about how their products are better because they are made in the U.S. use real wood, use real cotton, are handmade etc. However synthetics can be better because they arent as delicate, machine made can be more precise than handmade and overseas can afford more quality control procedures and more detail than the U.S. If there are differences how do you communicate them especially without big marketing budgets etc . . . . .? Cars, phones, beer, detergent, cakes, milk etc. Are nearly impossible to understand and communicate differences. The biggest inspiration with regards to marketing and differentiation is bottled water. Who would believe someone could, market a product for a dollar or more than one get for free. A key communication group that enhances communication is factors like image, culture, packaging and customer service. You know the consistency of a M.C. Donalds, the service of a Nordstroms, the appearance of a neighborhood store or simply the warmth of a hello, how are you. Many of these factors evolve from the culture of the organization which is based on excellence and respect. In summary differentiation is primarily a function of ensuring your product or service meets the needs of the consumer. As one expert said up...we all know the adage....features tell, benefits sell. Then how come so many of us still speak in terms of features and not benefits. The prospect doesn't care what your product or service does, they only care about what it does for them.

More Related Content

Differentiation

  • 1. Differentiation: What is it and how do we do it? Most of us understand the marketing concepts of differentiating ourselves from commodities. This can be accomplished by various actions including creating brands, quality , packaging , marketing , social and web marketing , distribution , service, convenience , education , serving niches, etc. . The purpose of these efforts is to avoid making price the main marketing tool and always being vulnerable to the next guy being lower. The theories are great. However, I am frankly tired hearing about the success stories of Apple, Coke, Ritz-Carlton, Nike, Whole Foods, BMW, etc. Most of these have been around a while, have lots of marketing money, are huge, are the leader in their industry or segment and really have created something special. I and believe most of us live in a different world. I have counseled almost 400 start-up businesses in the last three years and their issues are far different. They include restaurants, T-shirt companies, fitness centers, yoga studios, apparel companies, internet marketing companies and various services. For example, I live in NY and it seems like there are 2 pizza parlors, 2 nail studios, a Starbucks, and 2 bars or restaurants on every block. I find clients are frequently excellent at describing how they perceive they are different. For example the best section of many plans is the description of the product or service, the expertise of the company and how great they are. In contrast the weakest sections of the plans are frequently analysis of competition, market research, marketing plans and distribution plans.. There are, however, three areas where one can focus on differentiation in order to achieve greater success: How are you different? Do enough customers care about your difference? How can you communicate your difference? Does the consumer understand or care about their differentiation. Frequently we think we have something special and the consumer either doesnt understand o care. For example: I love everything about Costco and dont care about the large packages, any service, any bags and little selection. They have what I want , it is less expensive than others places, I find things there that are fun and they have great hot dogs In contrast I drink wine but have no interest in fine wine. no matter how much you tell me I cant tell the difference between a $ 10 and $ 100 bottle of wine
  • 2. Special service can be a big differentiator. I love great hotels , the deli where they know me and what I like , and even my gym where they are very subtle in asking me to move from the fast lane to the slow swimming lane when it gets crowded by saying you will be more comfortable These illustrate two critical concepts in differentiation. Can the customer tell or care about differences? While many women will crave expensive new shoes or purses, many men wont buy new shoes until the rain comes through the holes in the soles except their basketball shoes. For years marketers spent millions teaching consumers that coke and Pepsi or different vodkas are really different. Another issue is what quality is. Clients will talk about how their products are better because they are made in the U.S. use real wood, use real cotton, are handmade etc. However synthetics can be better because they arent as delicate, machine made can be more precise than handmade and overseas can afford more quality control procedures and more detail than the U.S. If there are differences how do you communicate them especially without big marketing budgets etc . . . . .? Cars, phones, beer, detergent, cakes, milk etc. Are nearly impossible to understand and communicate differences. The biggest inspiration with regards to marketing and differentiation is bottled water. Who would believe someone could, market a product for a dollar or more than one get for free. A key communication group that enhances communication is factors like image, culture, packaging and customer service. You know the consistency of a M.C. Donalds, the service of a Nordstroms, the appearance of a neighborhood store or simply the warmth of a hello, how are you. Many of these factors evolve from the culture of the organization which is based on excellence and respect. In summary differentiation is primarily a function of ensuring your product or service meets the needs of the consumer. As one expert said up...we all know the adage....features tell, benefits sell. Then how come so many of us still speak in terms of features and not benefits. The prospect doesn't care what your product or service does, they only care about what it does for them.