Hi, I’m Astrid. I’m an organisational psychologist who specialises in anything innovation, and I’m single. Now, these two things might seem unrelated, but as you’ll see in this series, I assure you they’re not.
When you go on a dating website, it is hard to distinguish the difference between candidates. It feels a bit like everyone went to the same ‘how to fill out your profile’ class and now religiously applies the rules. Apparently, every man in Melbourne (I can’t comment on other states) loves to be really active, to ‘try new things’ and to travel, as well as spending time with friends and family. All of this is typically accompanied by an ‘active’ photo (something on the beach, or skiing – depending on how the abs are going), a group photo or a photo with a baby, and a photo on a mountain somewhere far away. If you’ve seen one, you’ve seen them all. It’s confusing. How do you know who is who? It’s a commoditised market.
Differentiation is an interesting topic in business as well. There are many ways to differentiate, to win customers. Of course, there is price, and competing mainly on price can be a valid strategy. But when you are looking to target customers who are willing to pay a premium, you’ll have to find other ways to differentiate, ways which make sense in the eyes of the customer.
Differentiation in the eyes of the customer
I remember speaking with some senior managers at a recruitment firm; they felt that their firm was very different from their competitors’ and so they felt they could charge accordingly (“we have the best candidates!”). To their clients, what they offered seemed pretty much the same as every other recruitment firm out there (“that’s what they all say”).
The lack of real differentiation in the eyes of customers put pressure on the company’s sales team, which was left to sell based almost entirely on their relationship building skills. It had a significantly negative effect on the company’s culture, driven in part by the fact that the sales and marketing teams had become incredibly protective of these relationships. It was, after all, all they had.
If the way you talk about how you are differentiated is pretty much the same as what your competitors are saying, you are essentially competing on the same dimensions of value, and customers will almost certainly be struggling to see a real difference. Unfortunately, we see this happening in most industries! If that sounds familiar, it might be time to take a step back and get some real clarity on your customer value proposition. Having this clarity is essential for any business in a competitive market.
One final observation is that often, in highly, seemingly commoditised marketplaces, the companies themselves are fuelling the commodification. They do this by using essentially the same measurements for how they are trying to differentiate. I heard a great ad the other day for petrol: “Just two tanks of [the brand] of petrol will clean out your injectors and increase the life of your engine!” This seemed much better than “only $1.28 per litre” to me.
Is your business actually driving commoditisation by promoting things on the same dimensions as everyone else? Moreover, is your value proposition actually different in the eyes of the customer? Helping businesses to develop differentiated value propositions which guard against disruption is something we love to do. If you’d like to chat about it, please reach out at email@example.com.
Now, for all the men out there on dating websites, here’s my advice. Please be different. Maybe don’t compete on price (depending on the type of website you’re on), but do compete on any dimension that isn’t the same dimension as ALL the others. That would make my life much easier. Thank you.