Tools for Competitive Differentiation

Tools for Competitive Differentiation

Differentiating is an act of designing a set of meaningful difference to distinguish the company’s offering from a competitor’s offering. Competitive differentiation is a premeditated positioning approach an organization can carry out to set its products, services, and brands apart from those of its competitors. Here we will examine how a company can differentiate its market offering along five dimensions: Product, Services, Personnel, Channel and Image.

Product Differentiation

  • Differentiation in the physical product takes place in different ways;
  • Form: Size, shape or physical structure.
  • Features: Features are characteristics that supplement the basic functions of the product.
  • Performance: It refers to the level at which products primary characteristics operate. Performance may be low, high, average or superior.
  • Conformance: Degree to which products units are identical and meet promised target specification.
  • Durability: It is a measure of the product’s expected operating life under natural and/ or stressful condition.
  • Reliability: Measuring of probability that product will not malfunction or fail within a specific period.
  • Reparability: It is a measure of the ease of fixing a product when it malfunctions or fails.
  • Style: It describes the product’s look and feels to the buyer.
  • Design: It is the totality of features that affect how a product looks and functions in terms of consumer requirements.

Service Differentiation

When the physical product cannot be easily differentiated, success often lies in adding more value- adding services and improving their quality. Service differentiation is:

  1. Ordering ease: How easy it is for the customers to place an order with the company?
  2. Delivery: How well the product or service is delivered to customers. It includes speed, accuracy, and care attending the delivery process.
  3. Installation: It refers to work done to make a product operational in its planned location.
  4. Customer Training: It refers to training the customer’s employees to use the vendor equipment properly and efficiently.
  5. Customer Consulting: It refers to data, information systems and advising services that the seller offers free or for a charge.
  6. Maintenance and repair: It refers to a company’s service programs for helping customers to keep the purchased product in good working order.
  7. Miscellaneous: Company .may offer a better product warranty or merchandise contract than competitors.

Personnel Differentiation

This can be done by hiring and training better people than competitors do. Better-trained people exhibit some characteristics. These are:

  1. Competence: Possess skill and knowledge,
  2. Courtesy: Friendly, respectful Considerate,
  3. Credibility: Trustworthy,
  4. Reliability: Perform service consistently and accurately,
  5. Responsiveness: Respond quickly to customers’ request and problems,
  6. Communication: Make efforts to understand the customer and communicate clearly.
  7. Channel Differentiation: Company can achieve differentiation through the way they shape the distribution channel: Channel Coverage, Expertise, Performance

Image Differentiation

Buyers may respond differentially to the company image or brand image by:

  1. Symbols: Symbol triggers company or brand recognition.
  2. Media: Written or audiovisual.
  3. Atmosphere: The physical space in which an organization produces delivers and services.
  4. Events: Build identity through the type of events it sponsors.