What makes your offering unique and therefore relevant to your client base?
Competing in a market is more demanding than simply equalling the basic services that other businesses provide. To truly grow and improve your position you must possess a differentiating factor that separates you from your competitors, this becomes your relevance. The greater the fit between the needs of your target audience and your offering, the more influential your advantage.
A minority of businesses possess either a lower cost production or service capability than their rivals; therefore adopting a strategy based on having the lowest cost is neither realistic nor advisable. Being the cheapest in a market (niche) may make your company more appealing in terms of attracting clients, but without the infrastructure to support this, making your offering cheaper is a dangerous option that will likely result in losses.
Reducing the cost of your product/service for a limited time may be an effective way to attract the attention of new customers. On a short-term basis this may result in a fall in profits but could pay-off in the long run because of the interest you have generated. If undercutting the price of your competitors is not a sustainable option, then differentiating your offering is the best way to separate you from the crowd.
Identify what you do best as a company; use this as your springboard. Building from an element of your business which is already strong is far easier than looking to excel in an area of less confidence. Your established client base will already be aware of this company strength, so investing in this will increase their satisfaction, and hopefully inspire them to recommend you.
As well as this, it requires less effort and resources to increase the profit you generate from an existing source rather than finding and attracting new customers. Once you have generated a good level of revenue from this established group, you will then have the security and available funds to explore new opportunities. Knowing the income that this dependable base will supply, can allow you to plan for the future and dedicate a certain amount to riskier acquisitions.
Differentiation can come in many forms; it could be the exclusive features your offering provides or the speed of your service. What’s important is that your differentiating factor should one, be directly related to your target audience’s desires/needs, and two, actually be distinct enough to make it a recognisable part of your brand.
However, these differentials cannot be relied on longer-term; most features are relatively easy for competitors to match or even surpass in time. Therefore, the most challenging part is to be continually strategising for the future. This developmental mindset needs to be ingrained into your organisation to achieve sustainable growth. Standing still is not an option; strategic innovation should always be present to make your offering relevant.
What would you consider the strongest feature of your business’s offering? Do you utilise the client base you have already established? Is strategising for the future a key element of your company processes?