Every owner, manager, and salesperson should know their competitive advantage.
You should know what you offer the client that surpasses what they find elsewhere. You should know why customers choose to do business with you, not your competitor. You should know why you’re worth your client’s time and money.
But what if you don’t?
While understanding your company’s competitive advantage should be a basic component of running a business, it’s easy to lose sight of the benefits you offer your clients that sets you apart.
If you can’t readily name your company’s competitive advantage, here’s how to identify it and why it’s important to do so.
What Advantage Do Your Client’s Recognize?
When you need to identify your competitive advantage, don’t look within your organization for the answer. Look externally — the answer is there.
Your competitive advantage comes from the outside. I’ve been through several iterations of my consulting practice over the years, but the most important change was when my marketing firm decided to interview clients to discover my true competitive advantage.
They first asked me to state my competitive advantage, but I couldn’t answer them. They said, “No problem! We know how to find out.” They talked to about 20 different clients and collected great feedback. And not all of it was feedback I wanted to hear… but it was all extremely valuable.
Essentially, my clients completed the sentence, “We call Tom when…” In doing so, they helped me understand why people hired me, what they hoped to get out of my services, and what their expectations were in hiring me as opposed to hiring someone else.
You have some great clients. Call them and ask:
- What do you perceive us to do that’s better than your reasonable alternatives?
- What makes us more valuable to you than other providers?
- What can we do to maintain that position?
Don’t ask how you’re better than everyone else (there’s always someone who will be better, right?). Instead, try to identify something you do that sets you apart from the competition. Find that answer through the eyes of your clients.
As you ask these questions, you’re opening the door for feedback — both positive and negative. Be ready to take that in stride and use it to your advantage.
Why Your Competitive Advantage Matters
Identifying your competitive advantage isn’t just about better understanding why your customers choose you. When you really comprehend the value you offer your clients, you can leverage that into an even bigger advantage for your business.
When we identified the competitive advantage of my business, it became the driving force behind my next branding effort. Knowing my competitive advantage changed the way we portrayed our business in four major ways:
- It influenced how we designed our website.
- It changed how we wrote about our company.
- It affected how we presented products.
- It even allowed us to raise our pricing. If you’re selling what people want to buy, you’re going to be worth more.
Knowing your competitive advantage isn’t just about crafting a better company slogan — it’s about marketing your company in a way that better reaches your clients and capitalizes on what you already do well.
If you’re not yet using your competitive advantage to its full potential, take the time to have these conversations with as many clients as will give you time to do it. Then, review the answers with a group that represents multiple components of your organization.
What are the most valuable responses that you can better leverage?
Quite likely, if you add a little fuel to the fire you’ve already started, you’ll amplify the power of the competitive advantage you already have.