129: What Is Your Competitive Advantage?
In the past few months, I’ve had the opportunity to consult several entrepreneurs who were starting new companies or starting new brand initiatives. When someone is asking me for advice, I tend to ask a lot of questions. In these situations, it’s been interesting to me how many times I’ve stumped someone with a two-part question I didn’t intend to be difficult.
“What is your competitive advantage? Why would someone hire you instead of your competition?”
The answer to those two sentences should be easy. You need that answer to determine what your brand is and what that brand’s ensuing message will be. You can and should be leading your presentations by addressing how you solve your clients’ problems. Soon after that promise, though, you’ll probably need to explain why your firm best solves those problems.
Maybe you do it faster than anyone else or for the lowest net cost.
Maybe you have innovative technologies that aren’t available anywhere else.
Maybe you can offer exclusive, dedicated personal to their account and only their account.
Maybe you have more narrowly-niched personnel for their asset type and/or location.
Maybe your brand leads your market in recognition, social reach, and consumer participation.
Maybe your terms are the most friendly to buyers or sellers.
Maybe you have the most efficient and targeted advertising campaigns.
Maybe you have the best track record for monetary results and the data to prove it.
This is by no means an exhaustive list. Also, you may have more than one answer. In fact, you might have different answers depending on the competition. In my business, I typically have two categories of competition: designers or print shops in my prospect’s local community and national auction-industry vendors. My competitive advantages for those two categories have some overlap but are typically different.
Auctioneers compete with other auctioneers, but they also compete with other types of businesses. So, part of your primary competitive advantage might be the auction method in some situations. In others, where everybody is using a similar method, it will be other other criteria that separate your value proposition.
If you can’t answer this question of value proposition, how do you expect to differentiate your company from the pack? If you can’t differentiate yourself from the pack, what’s your plan for acquiring new clients? My guess is that you’ll end up with the riskier reserves, the headache clients, and the lowest commissions—the projects other companies don’t have to take. Then again, maybe that’s your intentional brand image: that you work harder for less.
Taking It Personally
I pretty much know what my professional value proposition is, but I wanted to know what my competitive relational advantage is. So, I asked my wife why she chose to marry me. She had thousands of options, just at our small college—and interest from a few other dudes in the communicative arts building alone.
“You made me laugh.” (Also, I didn’t pull my pants halfway up to my armpits like one of the guys who had taken her on a handful of dates.) She told me that she came to college from Bolivia wanting someone tall, dark, and handsome. I replied, “Well, you got the tall part.”
I try a lot of humor on her that doesn’t work. When I do make her laugh, she almost always tells me, “That was a good one.” This is good affirmation, as I work to maintain some job security. (I don’t think it’s unrelated that a lot of my social media posts and face-to-face social interactions seem to have the same relational strategy.)
I’d love to know what most drew you to your significant other. What made them so different from the other fish in the sea?
Stock image purchased from iStockPhoto.com.