I am not setting targets this year like I used to. It doesn’t work for me like I want it to. Either I achieve them too early and then I have a huge chunk of the year to spare, during which I freestyle, which isn’t ideal, or I put all efforts into achieving those specific targets, which leaves me not at my best because I then only move in a preset heading, leaving a lot unexplored.
I am at my best when I adapt. To adapt, I need tools pre-made to steer me right while widening the universal set of opportunities within my reach.
Nonetheless, this year, I need a heading. In 2020, I choose not to go North or South, but to build a custom compass that leads to one specific treasure, wherever it may be. That treasure is MARKET SHARE. How do I, you, any business get a fair share of the market?
Differentiation is a strategy that aims to distinguish a company’s products or services from the competition. Pretty simple when you put it that way. Afterall, we all aim to have our products and services stand out so it can outperform the competition. The big question is, exactly how do you do that.
Two words you should separate while reading: Differentiation and Focusing. Differentiation is the means to standing out. Focusing is one way of doing that.
This year, I choose FOCUS as the compass that will direct my Differentiation efforts towards the treasure of a bigger market share. With that, my goals and resolutions will score and resolve themselves. My aim for 2020 is to FOCUS enough, all towards being master of one, not the jack of a couple trades. Hold me to that and ask me by year’s end how it went.
At this point, forget about me. The opinion part is done. The rest are all facts. Happy New Year!
The barrier to market entry has dropped drastically. Within the past decade, many industries and sectors have seen a significant increase in competition as a result. The risk of confusing customers or missing your first attempt at a good impression is getting very expensive. Differentiation therefore has become vital to the survival of most products and services.
You need Differentiation when your product stands with its competitors, because that’s an obvious way it sells. But it also needs to stand out while it stands within your own list products and services as well. It is in your best interest to assume that the customer will not come to you for clarification, because most people will not bother to ask. They’ll just move on to a product they already know or one they can easily understand.
Change is worth pursuing when the gains outweigh the cost. Altering strategy to make your product stand out is worth the cost, obviously. So HOW can one spend that capital towards Differentiation for optimum output? We answered that. FOCUS. Yeah but focus HOW? WHERE?
As the name suggests, it’s got to do with the actual product and its physical properties. Product Differentiation could be working on the external features of the product, the properties of the product like its performance, and the efficacy (doing exactly what the product is supposed to do).
Whether it’s distinguishing characteristics in performance or physical looks, Product Differentiation is towards making sure the product has that extra edge over competitors. But there lies the problem. Most physical features can almost immediately be copied by competitors the moment it starts making waves in the market. This makes any lead in the market by way of Product Differentiating temporary.
Ideally, Intellectual Property Rights laws and our legal system should protect against such actions but practically, it’s much harder to do that. If that weren’t the case, a lot of innovators would maintain the lead. There are avenues for patents. Still, some companies choose not to because by patenting, they disclose exactly how that innovation came about, but patent protection last for only the duration of the patent.
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Having FOCUS is still best with Product Differentiation. See those medicine-sellers in public transport that advertise concoctions that cure about 36 varying diseases? Don’t do that. FOCUS on what your product does very well. Build on that. Maintain the feel of your product for longer periods so your customer base can form a bond with it. Then FOCUS on making sure your product does one thing very well.
Your product delivery and all other additional auxiliary supplements are not to be taken for granted. They are part of your product experience. Installations, training and ease of access to product all influence how much people are going to yearn for your product. Working to improve and exemplify these supplementary services can secure you a market share just as well as the actual product would. The product is not complete without these services.
Again, FOCUS on a model of service delivery that you do very well and run with it. Stick to it and refine it till it can easily be given out without customer complaints. Think of KFC, Mr Price, and other retail and food chains. The look, feel and experience are designed to be the same at every location no matter where the store is. This is because they understand the value of FOCUS.
Personally, I find this as one of the most important Differentiation avenues. The interactions that a customer has with your company personnel is how the customer is introduced to the product on an even more personal level. If I want to speak to my product, I call the company. If that conversation doesn’t go well, the relationship breaks down, then the company loses that customer.
Relationship Differentiation seeks to let your company and product stand out from the crowd by making sure that the company personnel display competence, reliability and credibility while providing some form of relatability as well. People use products that they feel are a part of their circle. Customer relations are therefore an important way to draw the market in on your operation and to let them feel like they are a valued part of your processes.
FOCUS is important here as well. Have you ever dropped a product because the customer service went bad? Most often it’s because there aren’t customer service guidelines for the staff to follow, especially for SME’s. FOCUS on getting a set of carefully prepared answers, reactions and responses to customer contact that communicates courtesy as well as responsiveness and you’ll have people saying things like “over at that company they’re so nice and efficient”. People don’t like having their questions unanswered. Also, people hold grudges, against other people and against products associated with them.
All the above differentiation avenues are the path to Reputation Differentiation. What’s the word on the street about your product or service that sets you apart from the competition? Properly executing the varying Differentiation techniques will create a good reputation for your product and company.
Some companies also deploy separate, targeted efforts specifically towards building a good image for the products. This is done by way of marketing. “Think Different!”. Remember where these two words come from? Through marketing, you can communicate the exact way you’d want your product or company to be perceived.
Also, the physical feel of the premises where the customers experience your product is important. They imprint on how the customer perceives the product and your operations.
An Image Reputation is not easy to acquire. Major companies spend tens of millions and employ many experts in order to maintain the image as the sector king. In such a sector, newcomers have a hard climb when they try to gain the attention of potential customers as suitable contenders or alternatives.
FOCUS can still be deployed to help build a reputation in this scenario. Big companies may carve a chunk of the market for themselves easily, and yes, unfortunately you cannot compete. But you can thrive but doing what you do best and doing it so well you can do it while you sleep.
Many people return for a product or service because of a specific need, a specific kick requirement. Give them that kick, and you’ll build a fanbase that no value of flashy ads can steal from you, because that’s exactly what they’ll be: fans. Through FOCUS, you create a niche clientele that nobody can take away from you because as you focus your efforts, you become a master of one.
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From My Thinking Spot
DALEX Finance and its operational strategy is a good example of how Differentiation through FOCUS has been used to capture market share. I wanted to give a good illustration of a local company achieving all I’m talking about. This is it.
With DALEX, it’s about VALUE DIFFERENTIATION by ensuring that the quality of credits they took on were better through advanced technology mitigation methods. So, they used technology to remove a lot of risks. By doing so, the value for their services skyrocketed, resulting in impressively low default rates. And this was before biometrics became an integral part of processes in Ghana.
Dalex’s FOCUS on a marriage between data and technology has guided its entry into markets where others have failed. That is why they can work with the rural farmer entrepreneur. With such a strategy, who wouldn’t. Dalex has depended massively on data and technology to mitigate risk. That is their FOCUS.
The beauty of this strategy is, it can be used in Shanghai, in Washington DC, or in Kokrobitey Ghana because it’s really about the thoroughness, the efficiency and the clarity of the technology and risk mitigation systems, which is their FOCUS.
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How do you think you can apply what you’ve just read in your current situation? Do you have any other Differentiation techniques that are worth mentioning? When have you embarked on a Differentiation Agenda through FOCUS and nailed it?
Hit me up on social media and let’s keep the conversation going! I read all the feedback you send me on LinkedIn, Twitter, Instagram and Facebook.
Also, feel free to send me your articles on relevant topics for publication on the Macroeconomic Bulletin. I’d give you full credit, an intro, and an outro. Kindly make it about 1000 words.
Have a lovely week!
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Maxwell Ampong is the CEO of Maxwell Investments Group, a Trading and Business Solutions provider. He is the Business Advisor for the General Agricultural Workers’ Union of TUC (Gh). He writes about trending and relevant economic topics, and general perspective pieces.