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Very few people can create a product or service so unique, or truly differentiated, that it speaks for itself. Especially in today’s crowded marketplace.
But there are ways you can make your product or service stand out against those of your competitors.
Here are some quick links to the sections discussed below:
Michael Porter, the pre-eminent Harvard Business School professor, stated that there are two generic ways to compete successfully [1]:
1. Differentiate: Provide unique features that customers value
2. Lowest cost: Enabling you to sell for a cheaper price than competitors
This article will cover the first of these two options.
And I can’t stress enough that it’s your customers’ perception of the extra value that matters. Even if it’s there, if they don’t see it, they won’t pay for it.
9 ways to make your product or service unique
Here are some examples of how to achieve this and stand out in a competitive market:
1. Design
The visual and aesthetic appeal of a product can persuade a customer to choose one product over another. This is especially the case if the design improves the usability and functionality of the product.
Example of a design feature for a product
The Apple iPhone is an obvious example here.
It wasn’t the first smartphone on the market but it was the first to combine sleek and minimalist design with advanced features like a touch screen and camera.
The design of the iPhone has since become iconic and many people are willing to pay a premium for an iPhone over other smartphones because of this.
Example of a design feature for a service
Service industries can also use design features to differentiate their businesses.
Most do this by making their branding and website design stand out from their competition.
Physical space design is another way to achieve this. Their office may have a unique layout, lighting, furniture and decor that aligns with a unique brand identity and creates a memorable experience for customers.
This approach can also create an emotional connection, e.g. if the space is particularly warm and welcoming. This is one reason why companies place vases of flowers or diffuse a perfume through their air conditioning.
2. Customisation
Offering customisation options can turn a standard product or service into something with much more personalised appeal for customers.
Example of a customisation feature for a product
A clothing company could allow customers to customise the colour and style of their items.
Nike does this by allowing customers to design and customise their own pair of trainers. They can choose colour and materials. They can even add personal details, such as initials.
This makes the product more appealing to customers who want unique and individual items.
Example of a customisation feature for a service
Service companies, like standard wedding planners, can also add customisation features.
While they may offer a set package that includes venue, catering and decorations, they could also appeal to customers who want a more personalised experience. For example, they could offer unique themes or work with specialised vendors to create personalised touches.
A wedding planning company that can offer a one-of-a-kind wedding can differentiate itself from competitors. It can also charge a premium for its customised service. This can help boost revenue and profitability (provided incremental costs to provide the extras are factored into prices).
3. Innovation
Innovation can add new and unique features to a standard product or service. This can help set a company apart from its competitors. It can also help enhance a customer’s experience.
Example of an innovation feature for a product
Dyson provides a good example of how innovation can make a product stand out from its competitors.
The company differentiated its vacuum cleaners from competitors by adding innovative features such as cyclonic technology, bagless dust collection and more powerful suction. This made the company’s products more efficient and effective compared with traditional vacuum cleaners.
Dyson also did this with its fans. Its bladeless design was created to look unique and also provide a quieter experience compared with traditional fans.
Example of an innovation feature for a service
American Express used this technique when it introduced its Virtual Card Number (VCN) and added it to its standard credit card service.
The VCN is a temporary number that can be used for online transactions. It provides an extra layer of security for customers who are wary of sharing their actual credit card number online.
This feature had particular appeal for frequent online shoppers and business travellers (who need to make transactions on unsecured networks).
4. Quality
Ensuring high quality in a standard product or service can differentiate it from competitors.
Example of a quality feature for a product
Let's consider the example of a basic laptop that is available in the market.
Most laptops have similar features and capabilities and prices are relatively similar. However, a laptop manufacturer could add a unique quality feature, such as highly durable casing. This could set it apart from competitors.
This added durability could be marketed as a unique selling point (USP). This should attract customers who are looking for a laptop that will last longer and withstand more wear and tear.
Example of a quality feature for a service
A high-end restaurant could differentiate itself from competitors by adding quality features to its service.
This could include using premium ingredients, providing exceptional customer service and creating a luxurious atmosphere.
For example, the restaurant could source locally-grown, organic produce and meat from pasture-fed animals to provide a unique dining experience.
They could also train their staff to provide exceptional service. This could include memorising regular customers' preferences and anticipating their needs.
A luxurious ambience could also be created through elegant decor and lighting.
5. Branding
Developing a strong brand can make a standard product or service more desirable.
Example of a branding feature for a product
Coca-Cola is a good example here.
While there are many cola drinks in the market, Coca-Cola has differentiated itself through its iconic branding. This has included its distinctive logo, red and white colour scheme and memorable advertising campaigns.
Customers are often willing to pay a premium for Coca-Cola over other brands because of the perceived value associated with its branding.
Example of a branding feature for a service
While hotels are largely a standard service, Four Seasons has differentiated itself through its branding efforts. The company has created a reputation for luxury and exceptional service that is associated with its brand name.
Another example here is Starbucks. Coffee shops are also a standard service. However, Starbucks has created a unique brand experience for its customers.
It does this by creating a particular atmosphere in its shops and personalising customer drinks. This way, Starbucks has differentiated itself through its branding efforts.
6. Customer service
Providing exceptional customer service can differentiate a standard product or service in a competitive market.
Example of a customer services feature for a product
For a retailer selling home appliances, such as washing machines, this type of differentiation can work well.
By itself, the washing machine is a standard product offered by many other competitors. However, it can be differentiated through exceptional customer service. This could include installation, maintenance and repair services.
Added to that could be knowledgeable and friendly customer service representatives available 24/7 to answer questions and address customer concerns.
The retailer could also offer free maintenance checks and repairs for a certain period after the purchase. This would all enhance the customer experience.
Example of a customer services feature for a service
If we take an execution-only brokerage business — one way to differentiate its standard service could be through offering personalised customer service. For example, a dedicated account manager for each customer.
This account manager could be available to address any issues, answer questions and provide recommendations on how to get the most out of the services.
The account manager could also proactively contact the customer to offer upgrades or new products and services based on the customer's usage patterns and needs.
This type of personalised service can enhance the customer experience and build customer loyalty.
7. Speed of delivery
Companies can differentiate their standard product delivery by offering faster delivery options than their competitors.
Example of a speed of delivery feature for a product
Amazon is the most obvious company to cite here. Its Prime shipping options include same and next day delivery (for eligible items).
Amazon is a great example of a company that has differentiated its standard products (books, electronics, household items, etc.) by offering a speed of delivery feature.
This has been a major selling point for many customers. In fact, it is this approach that has helped Amazon compete against bricks-and-mortar retailers as well as other online marketplaces. Few others can provide a faster and more convenient delivery option.
Example of a speed of delivery feature for a service
An accountancy firm that offers tax preparation could offer an express service for customers who need their taxes done quickly.
For example, customers who pay an extra fee can have their taxes prepared and filed within 24 hours instead of the standard time of 3-5 business days.
This feature may attract customers who have a tight deadline or need to submit their tax return quickly for some reason.
8. Packaging
Companies can differentiate their standard product delivery by providing unique and attractive packaging.
Example of a packaging feature for a product
A company that sells candles can differentiate itself from competitors by packaging its products in premium materials.
For example, it could create elegant and sturdy boxes with unique designs to reflect its brand.
This added feature would make the candles more appealing to customers who value luxury products and are willing to pay more for them.
Example of a packaging feature for a service
A meal delivery service could be differentiated by its containers.
It could opt for reusable or biodegradable containers and packaging. This would align with the growing trend of environmental consciousness where consumers are looking for ways to reduce waste.
9. Convenience
Making the service easy and convenient for the customer can be a significant differentiator.
Example of a convenience feature for a product
One example of adding a convenience feature to a standard product would be the inclusion of a detachable battery for an electric bicycle.
Traditionally, electric bicycles have a battery built into the frame. This can be heavy and inconvenient. However, by adding a detachable battery feature, customers would be able to easily remove the battery and charge it separately. This would make the bicycle more convenient to use and transport.
A folding mechanism for electric bicycles would be another example of a convenience feature. Being able to fold it to take up less space would make the bicycle more convenient to store. This could certainly appeal to customers who live in small apartments with limited storage space. It could also help prevent theft.
Example of a convenience feature for a service
Taxi-sharing services like Uber are standard services that provide transport.
However, they have added a convenience feature of real-time tracking. This allows customers to see the location of their taxi in real-time on their mobile app.
Mobile check-in and boarding passes are a similar example for airlines.
Both help customers plan their time more effectively and give them a better sense of control over their travel.
Customer experience and differentiation strategies
While you may have lots of ideas about how to make your product or service stand out in the market, it’s important that whatever strategy you choose is based on your competitive advantages and creates a positive experience for your customers.
To do this, you need to consider the entire customer journey — from initial awareness and consideration to purchase, delivery and post-purchase support.
Here are some steps to consider:
1. Stay close to your customer
A company should always understand its target customers' needs, preferences and pain points.
You can do this through market research, asking for feedback, responding to queries and addressing concerns.
You should monitor how your customers behave regularly and look for any patterns or trends. Website analytics and sales data can help here.
It’s also good to stay up-to-date with industry trends so you can anticipate changes in customer preferences and stay ahead of the competition.
2. Test and iterate
Once you’ve decided what differentiation features you want to include in your business strategy, you should test your ideas with your customers (perhaps those you value most). You can then make adjustments based on their feedback.
This can involve prototyping, user testing and beta programmes (i.e. using test to determine if final product or service fulfils the value proposition it was designed to deliver).
3. Communicate the value proposition
It’s important that you clearly communicate to your customers the value proposition of your differentiated product or service.
This will involve input from your marketing team and will require effective messaging on your company’s website and social media channels.
4. Monitor and adapt
You need to monitor customer feedback and market trends to ensure your differentiation strategy remains relevant and effective.
This may involve having to make adjustments to your product or service as you progress. It may also require updates to your messaging and marketing strategies.
Overall, if you prioritise customer experience when you create your differentiation strategy then you are more likely to succeed in standing out from your competitors. It should also help you win customer loyalty.
[1] Porter, M. (1985) Competitive Advantage: Creating and Sustaining Superior Performance. New York, Simon & Schuster Inc.