How to Properly Differentiate Your Business From Your Competitors

Jan 14, 2021

Sharon: Good morning, this is Sharon Heller, and I’m here with Steven Kohnke from Denver Business Coach. Good morning, Steven.

Steven: Morning, Sharon how are you today?

Sharon: I’m good. Looking forward to our conversation this morning. What is our topic today?

Steven: So as we’ve been talking, we did some qualitative research a few months back and we are really responding to some of those answers that business owners in the area were talking about, and where they’re showing up, and where they are not.

One of the questions on there was about positioning and being able to position your business in the marketplace and clearly communicate why your customers should be choosing you over the competition with within your marketplace. So we’ll talk about that today.

Sharon: Awesome. Well, this may be a kind of obvious question, but I’m going to ask it anyway, because I think it’s a value to hear what you have to say. Why is it so important for business owners to be doing this?

Steven: Yeah, being able to truly and critically think about differentiating yourself in the marketplace is what’s important. There can be a hundred thousand different plumbers out there. So why should a homeowner choose your business over the next one? And being able to clearly communicate and differentiate yourself from that pack is what’s going to make you stand out.

Steven: So being able to critically think about how you are different is very important in being able to get your business to that next level. It increases the value of your business ultimately. It avoids being a commodity. Competing on price is always a race to the bottom that no one wins.

Steven: And when we’re talking about being that valuable business, Warren Buffett always comes to mind to which he talks all the time about differentiation. And he invests in businesses that have that deep and wide moat, which just says all other businesses within that industry, that marketplace, are going to have a really tough time competing with them because they’re just in a different league. So being able to critically think about that is the important piece to win more business.

Sharon: So just wondering how to go about it. What are some key factors that a business owner should be thinking about when they’re kind of pondering how to differentiate themselves from the competition?

Steven: Yeah, it’s a great question. So as a business owner, when you’re thinking about how to differentiate yourself, how to avoid becoming a commodity, how to really increase your value proposition, there are two things that you need to be looking at.

1) You need to look at your messaging through the lens of does this actually makes us different?

2) And, do customers actually care?

Steven: Something that is very common for businesses to hang their hat on is “our customer service is better than the competition.” And, to me, that should be the commodity, that customer service. What else are you competing on? Everyone can say that they have excellent customer service and are superior to others, but unless they’re already using your business, they can’t really attest to that.

Steven: And the idea is that you win new business and get more business and retain that through customer satisfaction. But to really have that as your differentiator isn’t expanding that moat, if you will, you really need to be paying attention to: Do the customers care, and does this makes us actually different? Because everyone is going to say that their customer service is better than everyone else.

Sharon: That’s a good point. So just to go further, I guess in the same vein, how could a business owner differentiate their services and avoid becoming that commodity that you were just talking about? Like how do you kind of narrow it in, and determine what is that differentiating factor?

Steven: What does make you different? How are you better than the rest? So it’s really being able to, again, what does your target market truly care about? And you can be a, I’ll continue on with the plumber example, there can be five different plumbers that can do the exact same thing, but how are you going to be different? And it’s understanding your target market. Who are you actually servicing?

Steven: A typical way that service businesses like a plumber will talk to their customers is, I have a window between 9 and 12, and for someone who has a 9 to 5 job who needs to know their schedule and it’s very, very tight, that’s tough for them.

Steven: But if you’re a plumber business and you say, I guarantee I’ll be there for between 9:00 and 9:10 in the morning. That’s something I can plan my day around. I can do other things around that. So that type of person is how you’re going to be able to differentiate by saying, “hey, this is what we hang our hat on. We know you’re busy. You have a schedule to keep. So this is what we do for that” It’s not the all-day window of just wait around for us until we show up.

Steven: So that’s one way to really look at it, is understanding your target market. Another simple way to do it and where I would usually start is a SWOT analysis – strengths, weaknesses, opportunities, threats. And doing that with your competition in mind too, so doing it for yourself and your competition, and seeing where the real differentiators are, and seeing if that’s something that your customers actually care about.

Steven: So again, going back to looking at it through that lens and saying, what really does make the difference? And those are the two different examples of how I would actually go about figuring out what that messaging is.

Sharon: Right. I’m sure we can talk about this all day long, Steven. So what would you say in closing, there are probably some people who are eager to hear more.

Steven: Yeah. So to figure out and to have a conversation with us, the easiest way is to just go to the website We have a couple of different ways that business owners can reach out to us. And any one of us on that team is going to be able to have that differentiating conversation. And we’re happy to do it.

Sharon: Hey, thank you. Great conversation today, and we’ll talk again soon.

Steven: Thanks, Sharon. Talk to you soon.