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By Candace Coleman, CultureWise Content Manager
The battle for customers is a Darwinian undertaking for every organization. But being an industry stand-out is especially hard for smaller businesses without the resources that some of the market giants seem to have in endless supply.
The challenge for these businesses is to find a means to differentiate themselves that they can afford and sustain. Many company leaders may not realize that the solution is already in their grasp: their corporate culture.
What is Differentiation?
When a business owner or CEO seeks to differentiate their company, they develop one or more unique qualities that set it apart from rivals. These distinctions go beyond creating effective marketing and branding designed to attract buyers and prompt them to remember a product or service.
Real differentiation is in the end result for the customer. Once in place, successful differentiators provide consumers with a value they can’t find elsewhere.
The three tactical areas of differentiation are:
- Pricing
- Goods & Services
- Organization
Pricing
Customers are usually cost-conscious, so most businesses look for ways to keep their prices competitive. But if cost is a company’s only differentiator, it puts them in an exhausting pattern of constant adjustments to outdo contenders.
The ongoing quest to lure buyers with lower costs can lead to price wars that can endanger a solid profit margin and drain a company’s energy. As noted in the Harvard Business Review:
“Price wars can create economically devastating and psychologically debilitating situations that take an extraordinary toll on an individual, a company, and industry profitability. No matter who wins, the combatants all seem to end up worse off than before they joined the battle.”
Even when companies find an effective pricing strategy, competing sales pitches can overwhelm potential customers—especially if they’re searching for what they want online. If the difference in price between multiple offers is slim, many buyers wind up making a choice based on other attributes like quality, a single feature, or even a color.
In a nutshell: A business can drop its prices to be competitive, but rivals will always find a way to offer something similar at a lower cost. Merely having a competitive price tag is not a big enough differentiator.
Goods & Services
Logically, the second differentiator is in the goods or services that companies want people to buy. Several factors go into making a good product:
- Quality: Is your product made better than others? Is your service structured better?
- Design: Is your product or service uniquely designed?
- Features: Does your product or service do something the competition can’t?
Businesses that strive to make their goods or services the gold standard consider all these things and take pride in what they sell. A product may draw customers because it solved their problem faster, easier, or more enjoyably. Or perhaps they were enticed by its reliability, appearance, or quick delivery.
But when companies rely on the commodity they sell as their sole differentiator, they’re unlikely to stay ahead of the game. No matter how good their mousetrap is, someone is already out there building a better one. Even if a business has a proprietary element that is harder to copy—eventually, someone will.
The market is getting more saturated every day, and there is always something new and shiny to draw customers to shop elsewhere.
Organization
Aside from the price and the merit of the offered product or service, the seller’s organization is the third differentiator. A company’s internal operations and public interactions strongly impact the customer experience and satisfaction.
Once people are attracted to a company’s product or service, the organization itself can be the factor that makes them lifetime fans.
Essentially, the behaviors embodied by an organization’s workforce can be the most powerful differentiator. Those cumulative behaviors form a company’s culture. Organizational culture contributes just as much to the customer’s experience as the product or service itself and probably more than the price.
When the right behaviors are identified and cultivated, a high-performing culture can become a company’s unique selling point. Leaders can leverage a strong culture to develop a significant base of loyal customers who further the mission by becoming brand ambassadors.
And unlike easily copied pricing and product differentiators, an organization’s unique culture is almost impossible to clone.
CultureWise founder and CEO David Friedman makes an additional point:
“ If we could somehow get our people to be better than our competitors’ people, in how they treat customers, how they do their own work, and how they work as a team, not only would that be the biggest differentiation we could create in this commoditized world, but I’d argue that it’s the most sustainable advantage we could create. “
10 Differentiating Behaviors in a Strong Culture
Many behaviors combine to create a high-performing culture. Here are ten that, when performed with consistency, can be compelling differentiators in the marketplace.
- Deliver Legendary Service
- Create a Great Impression
- Walk in Your Customers’ Shoes
- Make Quality Personal
- Be Easy to Work With
- Deliver Results
- Go the Extra Mile
- Invest in Relationships
- Honor Commitments
- Act with Integrity
1. Deliver Legendary Service
Studies show that while 80% of business leaders believe they provide excellent service, only 8% of customers agree. What happens when a customer chooses to do business with a company and then endures a poor or even lackluster buying experience? Most people will try another option the next time they need the same kind of product or service.
But when a customer is blown away by their experience with a company representative, even if they’re paying more than what they may spend elsewhere, they’re likely to stay on board.
But one incredible experience isn’t enough. To take this behavior to the next level and make it a differentiator—every encounter should stand out. Staff members who strive to create the “WOW” factor in each customer interaction will turn buyers into raving fans.
2. Create a Great Impression
A smile and friendly manner should be standard conduct every time staff interacts with customers. As simple as it sounds, it’s amazing how many companies don’t reinforce this behavior. And it only takes one “off-day” for an employee’s demeanor to make a bad impression—regardless of the quality of the product or service they’re selling.
It’s also important to remember that customers form opinions about a company during every type of interaction—not just those that are face-to-face. To create an outstanding impression across the board, the tone for every conversation, phone call, email, letter, and voicemail should be friendly, warm, and helpful.
For a company to stand out, creating a great impression should be an intentional, daily pursuit for every team member.
3. Walk in Your Customers’ Shoes
Customers appreciate empathy. They like to believe that the person they’re doing business with understands their challenges and frustrations. Companies can promote this behavior on two levels:
- Coach employees to gain a strong understanding of their typical customers and learn what motivates people to need your product or service.
- More importantly, staff should seek to understand individual customers’ perspectives.
A buying experience shouldn’t feel like “one size fits all,” even if people are receiving the same thing as everyone else. Customers are gratified when company representatives take the time to understand the reason behind their purchase and what they are expecting from it.
Making it a practice to walk in customers’ shoes gives employees an advantage in delivering cutting-edge service. The better they understand customers, the more effectively they can consistently anticipate and meet their needs.
4. Make Quality Personal
For this behavior to be a differentiator, every staff member should adopt the attitude that good isn’t good enough—whether they interface with customers or not. The quality of an internal employee’s work, in the office, the warehouse, or the loading dock, indirectly affects customers, too.
Customers may not understand why they have great experiences, but employees on the front lines know it’s because every team member is living up to the highest standards. Inconsistencies in internal quality can lead to poor customer interactions. There’s a trickle-down effect either way.
When every team member makes quality a personal issue, a passion for excellence resonates throughout the organization, and it makes a discernable difference to customers.
5. Be Easy to Work With
We’ve all weathered buying experiences when we had to jump through hoops to get what we want. Whether it’s intolerable call hold-times, multiple transfers, long lines, excessive paperwork, or some other roadblock, it’s frustrating when it feels like work to spend money on something.
Imagine how different and refreshing these situations would be if companies went out of their way to make things easy for buyers.
To stand out from competitors in this area, a company’s internal and customer-facing staff should constantly be looking for ways to make working with them hassle-free. They should try to streamline processes, provide simple and clear instructions, and never push work or time back on the customer.
For this behavior to be a differentiator, a good mantra would be: simplify everything and be ridiculously helpful.
6. Deliver Results
The last thing a customer wants to hear from a company representative is that they worked really hard to provide what was requested, but they came up short. Customers don’t want to know how much time and effort staff members put in to meet their needs—they just want what they were supposed to receive.
Effort is important, but people expect results. To create an excellent track record in this area, managers should help their team members:
- Follow-up on every part of a process
- Take responsibility that tasks get accomplished
- Set high goals and use measurements to track progress
- Develop personal accountability to achieve results
A differentiator is established when customers are confident that they will get what they need every time they do business with a company.
7. Go the Extra Mile
Too often, employees only focus on operating within the parameters of their role. Even reasonably good workers won’t impress customers if they limit their efforts to the basic requirements of doing their job.
For customers to discern a difference, a company’s representatives should be willing to do whatever it takes to accomplish a task, plus a little bit more. That might entail coming in early, staying late, or jumping in to help with a project that isn’t typically their responsibility.
Going the extra mile separates the ordinary from the extraordinary—and customers won’t forget it.
8. Invest in Relationships
People don’t want to be viewed as transactions. Instead of simply meeting customers’ needs effectively, employees should work to develop relationships with them.
Whenever possible, company representatives should try to get to know customers on a more personal level. Adding personal touches to service, such as remembering birthdays, anniversaries, family names, and individual interests, will go a long way toward establishing a bond.
Genuine human connection adds to customers\’ perceived value when they do business and makes them less likely to shop around.
Investing in relationships takes a little extra time, but it will pay off in a high level of customer loyalty.
9. Honor Commitments
A staff that follows through with every responsibility builds a reputation for reliability. If customers know that they can depend on the people who work for a company, it takes the stress out of doing business. Most have had disappointing experiences elsewhere, and they find it refreshing and reassuring to know they won’t have to keep checking to make sure their needs are met.
A commitment can be a big as finishing an important project on or before a deadline or simply arriving at every meeting on time. Taking commitments seriously also involves not agreeing to requests that will be impossible to meet and then working out alternative positive solutions.
Honoring commitments shows respect and establishes trust—and consumer trust is a priceless differentiator.
10. Act with Integrity
Nothing erodes a customer relationship faster than a company not acting in their best interest or doing something unethical. It doesn’t even have to be a blatant incident or an ongoing pattern of poor behavior. It only takes one lapse of integrity for a customer to sever ties—there are plenty of other places they can take their business.
Just as customers will recommend a company after having a great experience, they’ll be sure to spread the word about an unprincipled organization.
For ethical behavior to become a differentiator, a company’s integrity should be apparent in every staff member’s behavior. There should be a consistent commitment to honesty and doing the right thing for the customer—and it should be evident in everything company representatives do and say.
Lapses in this area can ruin a company’s reputation. But as noted by author and leadership expert Robert Chesnut:
Capitalize on Your Culture to Stand Out
A company’s culture won’t attract much attention if its staff occasionally exhibits impressive behaviors. Lots of businesses have that going for them.
For customers to register a company as extraordinary, unmatched service experiences should happen like clockwork.
To build a distinctive culture, leaders should develop a process to structure and continuously strengthen it—just like any other aspect of a winning business model. They should identify and then regularly reinforce the behaviors that, when done with consistency, will distinguish their business from competitors.
CultureWise: A Differentiation Tool
David Friedman’s book, Culture by Design, is an excellent resource for business leaders who see the potential in developing a differentiating culture. It offers a step-by-step guideline to create and sustain a culture that will attract and retain customers. A free, two-chapter download provides valuable insight into his method.
The book inspired the development of CultureWise, a ground-breaking operating system for culture. The program offers a unique and effective way to teach the behaviors that create world-class organizations; the ten behaviors outlined in this article are part of the CultureWise system.
Visit the website to learn more about the program that has helped companies throughout the country become more competitive.
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