It’s rare in this day and age to have a business idea that’s going to monopolise an area of the market leaving you with exclusive control over a product or service. This means that your business will be going up against other businesses; your competitors! Here are three areas you can focus on to differentiate yourself in your market and gain the competitive edge.
1. Customer service
Customer service is without a doubt imperative to business success and the retention of customers. Can you think of a time when you’ve experienced bad customer service? Did you happily return to this business? Did you tell your friends about your bad experience? Perhaps you even left a bad review on Facebook. It doesn’t take long for bad customer service experiences to be spread around and damage the reputation of a business.
Never underestimate the power of a smile. If you and your employees are giving out smiles for free then chances are you’re going to make your customers feel wanted and appreciated. Smiles are contagious so if you can offer a quality product or service AND put a smile on your customers face, then there is potential for you to make a lasting impression that could mean your customer returns another time or they’ll even tell a friend about the experience and boost the reputation of your business via word of mouth.
Showing gratitude to your customers is a common courtesy many businesses are forgetting to capitalise on. Thanking your customers, a follow up email to see how they are getting on, or even a loyalty program, are good ways to make them feel appreciated. You may not have the most competitive price for your product in the market but if you’re able to provide a better overall experience and quality for money then you’ll leave a lasting impression.
2. Correct pricing
If you’re not in business to make money then it’s a hobby because at the end of the day your business is about making profit and the bottom line. Your price will be a key variable in determining how much of a demand is generated for your product or service. Take a look at your competitors’ pricing strategy. Are they having periodic clear out sales? Does their price differ on weekends? Are they a large company buying in bulk? Once you have a clear idea of your competitors’ pricing strategy, you will then be able to decide what pricing strategy suits your business and the business goals.
Tiered pricing is another really effective way to target the needs of different customers, based on price. Many businesses from airlines to supermarkets to photographers to restaurants have different tiers of pricing to suit various needs. Take an airline for example, they break their ticket categories down into economy, business, and first class to cover the needs of a large target group. They are able to make more money from people wanting to purchase a first class ticket while at the same time offering cheaper tickets to keep their demand high. This is the same idea as a supermarket providing generic brands of their products at a lower price than name brands.
Finally, add-ons are a great way to increase the spending habits of your customers by upselling in a way similar to the famous McDonalds question, “would you like fries with that?”. Once the customer has committed to a base product at a price they are happy to pay, you have a great opportunity to offer extra add-on products that complement the base product and increase sales at the same time.
A niche is created by identifying a need or want in the market that is not being supplied by your competitors ie. you offer something different from everyone else in the same market. It’s a great way to define exactly who you want your customer base to be, so you’re then able to offer a quality and specialised product or service that fills a need that your competitors were not previously filling.
When finding your niche you’ll need to ask yourself, what specialist knowledge do I have to offer? Have my competitors missed an area I can fill? How can I provide a higher quality product or service so my market feels as though they need me?
A niche gives you the competitive edge because you will can become a specialist in an area with many generalists, and your target market will wonder how they ever got by without you!
Going up against the competition can be really daunting, but taking the time to analyse your competitors and coming up with some really great strategies of your own will mean you’re prepared to hit the ground running and quickly start gaining market share. For more tips and tricks on how to start or grow your own business, join us on social media here:
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Remember, your success is my priority!
Business Mentor and Master Coach
Founder, Radiate Coaching + innerCIRCLE6