Most companies have a sense of where they lie in the market and what makes them different. But, companies frequently change strategy and there could be an opportunity to move far away from the pack with our tips on how to find your competitive advantage.
We’ve written about finding your competitive advantage in an earlier post but found we had more to say and needed to add more pragmatic information.
The competitive advantage is what makes your company different. Sometimes it is a spin on how the product or service is offered or it could be that you offer a unique product or service. This difference is what makes your company more favourable to potential customers.
Before you sit down to define your competitive advantage be sure that you understand your potential customer. If you need help with that part read our blog on how to find your ideal customer. Understanding who you are targeting is the first part of your marketing strategy and you can’t move forward without this completing this critical piece.
Once you are armed with this information, here is how to find your competitive advantage and possibly even develop new advantages.
1. Perform a competitive audit – both with marketing and the actual product.
The marketing audit tracks the marketing tactics your competitors use. Do they publish content marketing? Use Google Adwords? Use retargeting? What social media channels do they post to? How often and with what result? There are over 40 marketing tactics and its best to search for all them as there may be opportunity there for you. We usually find that looking at 6 competitors gives us a strong idea of what the marketing tactical trends are in a particular market. Also remember there are indirect competitors so be sure you understand what those may be. And finally, your prospective customers can opt to do nothing so addressing that option will round out your audit.
Next, look to their product and service to understand how it is similar and yet different from yours. Evaluate the reason for any differences to determine if you should adopt that approach or maintain your existing strategy. We like to ask what problem is being solved by that approach. It could be a process that benefits the company versus the prospective customer so understanding why that difference exists is critical to evaluating if you need it.
2. Talk to your existing customers.
We like a mix of online surveys and qualitative data that can be acquired by interviewing customers. We think the interviews are best performed by someone outside of the company to ensure that impartial information is obtained. Customer feedback could be a wealth of information. Ask what an ideal company would offer. Ask what they like best about your company and what areas of improvement might exist. Check that your current positioning and messaging is understood by your customers. Pay close attention to the answers because some might give away the competitive advantages you could offer.
3. Talk to prospective customers.
Network with your ideal customers. Attend trade shows or other industry events where you can talk to them and solicit feedback. Add a poll to your website or social media. Conduct a survey. Ask all the same questions as with your existing customers but remember to ask why they selected the company they are currently working with. The answers will give you insights into potential new offerings. Prepare for response rates lower than with your existing customers but you’ll gain valuable information that will help round out the information you already have.
4. Now, assess your opportunities to improve or develop your competitive advantage. Then check it twice!
If you completed steps 1 through 3, you now have a wealth of data that should indicate what problems your ideal customer has and how you could solve them. Then, layer on the marketing tactics and see where the opportunities lie for communicating your new approach. You now have a very compelling strategy that you did not have before you started this process. One last quick check: does it solve a problem?
And this leads to the final step:
5. Communicate it!
Easier said than sometimes done, succinctly communicating your competitive advantage is the most critical step. Ensure its backed up by proven facts. This is called a value proposition and will become the defining statement of your company. You want the response to be, “Tell me more”, whether that comes in via face-to-face events, website lead forms or engagement on social media.
Competitive advantage is only one of the critical elements in a strategic marketing plan. If you feel like you need some help, reach out to us. We’ve helped over 250 companies with their marketing strategies and tactical plans.