What if there isn't much difference between you and your competitor?Transcript
Well, first you need to recognize that this is not sustainable: not if you aim to be a profitable and growing company. You must have differentiation in order to create value for your customers and for your business.
There is a word for an undifferentiated company or offering, and that is: commodity. A pure commodity confers zero margin, because when an offering is the same as its alternatives, the only way that it can compete is on price. So, first recognize that you need to tap into differentiation in order to have a healthy business.
Second, consider that you may be more different than you're currently appreciating. You simply need to pinpoint more assiduously what is special about your business that is meaningful to your target customer.
I have a framework that can be useful here. It's the Uncommon Denominator framework. And in this Venn diagram, you have one circle that's your customer’s desires, and you inventory everything that the customer wants. You have another circle that's your competitors' strengths. And then you have another circle that is your company's strengths. If you've already done this and you're still coming up empty, dig deeper, dream bigger.
What are the things that your customer really wants, not just the things that they're saying they want, but if you read between the lines, what's really important to them that they're not getting now?
And what are the things that your company is really, really good at? What makes you really special? Then keep working until you find an overlap that's meaningful, between what your customer wants, what you're good at, and what your competitor is not good at.
Mark Benioff, who's the CEO and founder of Salesforce, wrote a book called Behind the Cloud, and in this book, he talks about how meaningful one of these times of reflection was for him in the beginning, when he was conceiving of Salesforce.
Benioff noticed that no one seemed to really like sales automation software, and yet most companies were still using it. Benioff wondered: what if he could develop a product for these customers that increased productivity as their current solution was, but also was made easier to afford and easier to use.
Benioff was identifying a meaningful customer desire that previously, no competitor was answering, so do what Benioff did. Take that circle, that customer desire circle, and take your company strengths circle, and enlarge them, and dream bigger with both of those circles. What Benioff did is instead of creating a business and an offering for his customers that was incrementally better than those of the competitors, he made something that was truly different.
Think about your brand. Have you settled for being merely incrementally better than the competitor, or are you striving to be truly different?
Remember, the most value-creating brands are the ones that sit above the rest, away from the petty one-upsmanship. They dominate their promise. They're not just a little bit better. They're truly different.