The online business world is booming, with new ventures popping up every day. Many of these businesses closely resemble larger, more established companies. While learning from successful businesses is essential, outright copying them is not the way to go. Your business needs to be unique, offering something different and valuable that sets you apart. But what does it truly mean to be unique?
Competing on Price vs. Value in Online Businesses
In business, competition boils down to two factors: price or value.
When your business lacks uniqueness or differentiation, you’re forced to compete on price. Customers will choose you only if your prices are lower than your competitors, because there’s no other reason for them to buy from you. Without distinctiveness, your product or service becomes interchangeable with others in the market.
On the other hand, when you offer something unique that your competitors don’t, you have the opportunity to compete on value. Customers will choose you because they see the added or distinctive value in what you provide. Not every customer will choose you, but that’s okay – the ones who do are your ideal clients. These customers are willing to pay a premium for the value you deliver, making the decision factor value, not price.
The Relationship Between Value and Price
It’s natural for customers to weigh additional value against additional cost. The value you provide must align with the price you charge. If your offering doesn’t justify the price, potential customers will hesitate. That’s why it’s crucial to understand your market and test what your target audience is willing to pay for your product or service.
By providing differentiated value, you can position yourself as the go-to solution in your market. But how can you create products or services that stand out?
Three Ways to Differentiate Your Online Business
1. Innovate with a Unique Product or Service
Offer something completely new that no one else in your industry provides. This approach, known as product innovation, can give you a significant competitive edge. For example, Apple’s iPod revolutionized the music industry by introducing something entirely new.
2. Improve on Existing Products or Services
Enhance what already exists by providing incremental value. This could mean better customer care, superior service quality, longer guarantees, or eco-friendly features. For coaches or teachers, it could mean offering a unique methodology or perspective. These improvements, while not groundbreaking, can make your product or service more appealing and distinct.
3. Enter an Untapped Market
Identify a market where your product or service doesn’t currently exist. This strategy requires thorough research and a business model tailored to succeed in under-served areas. For instance, Car Cinemas in the US focused exclusively on towns with populations under 200,000, thriving in spaces larger cinema chains overlooked.
Finding Your Unique Edge
Whether you run a product- or service-based business, understanding what makes you unique is crucial. Ask yourself:
Do you offer something your competitors don’t?
Can you leverage this differentiation to attract your ideal customers?
Are there features or benefits of your product that stand out in the market?
Highlight these unique aspects and make them central to your marketing efforts. They’re the key to building a loyal customer base and thriving in a competitive landscape.
What If You’re Struggling to Identify Your Differentiator?
If nothing stands out as unique about your product or service, it’s time to compare your offering with your competitors’. Create a list of features and characteristics, then analyze how they stack up. If no differentiators emerge, it’s time to go back to the drawing board. Look for gaps in the market or unmet needs among your target audience, and develop a solution to fill them.
What Does It Mean to Be Unique?
Uniqueness doesn’t have to mean inventing something entirely new. It can be about offering a different combination of features, providing exceptional service, or addressing a specific niche in the market. Standing out doesn’t always require groundbreaking innovation – sometimes, it’s about doing ordinary things extraordinarily well.
By identifying and highlighting what makes your business different, you can attract the right customers, compete on value, and thrive in even the most competitive markets.
At SMRT Consulting we often work with startups that are looking for way to be unique, and we would love to have a chat with you, understand your needs and see if we can partner together, and hopefully add value to your new venture.
Book a short free of charge consultation session, and let's start talking!
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