Events & Speaking | May 13th, 2016
6 Tips to Differentiate Your Business and Stand Out
What makes you better than the competition? Why should a customer choose you instead of another company in your industry? Learning how to differentiate your business is important for all small business owners because not only are you competing against other small businesses, but you also have to fight well-known national and global companies for a slice of the market.
One business that has excelled in differentiating itself is Contango, an information technology company that prides itself in “keeping costs down, building your business up.” In a recent interview, I spoke with founder and CEO Danny Mizrahi, who told me about the ways they have differentiated themselves in the IT industry and how he’s created a company that is run quite differently from other IT companies out there. You can listen to Contango IT’s story below. I’ve also pulled from Danny’s story to provide tips on how you too can differentiate your business.
How to Differentiate Your Business – The Contango IT Formula
1. Examine the Competition
You can’t differentiate yourself if you don’t know who or what you are trying to be different from. What is happening in your industry? How does the industry tend to operate, and what are your major competitors doing? Learning what others are doing, how they are doing it, and why they are doing it will allow you to differentiate your business.
As Danny mentions in the interview, he examined the IT industry to understand its current state and how he could set his company apart. What he found was that the majority of IT companies are making money by selling unneeded monthly plans and upselling products. He decided it was best to avoid these practices and base sales solely around hourly work.
2. Understand Customers’ Pain Points
Now that you know what your competition and industry are doing, it’s time to examine your customers. What are their pain points? What are their gripes about the current system? What problems do the customers need to be solved that will bring them to your business?
Danny’s customers are businesses that are looking for IT solutions. The problem with IT is that it can be quite costly (especially considering the aforementioned model of upcharges and monthly fees), and it’s also confusing. Danny knew he could differentiate Contango IT by keeping prices down and also shedding light on some of the confusion and misunderstanding surrounding IT. To Danny’s competitors, Contango IT is “like that magician on TV who is telling everyone the other magicians’ tricks.” Of course, this is not popular with the competition, but it benefits the customers, which is the main goal.
3. Apply Ideas and Practices From Other Industries
For a fresh take on your own industry, you can always look to other industries for inspiration. This allows you to differentiate your business by bringing in new ideas that will appeal to customers.
As we mentioned before, Danny chose to avoid the practice of upcharging and monthly fees and instead adopt an hourly rate model. He got inspiration from this idea by looking at other industries – for example, law firms that charge by the hour. The IT industry has moved away from this model in favor of some ‘sneakier’ methods of making a profit. However, Danny knew that there was plenty of money to be made fairly simply by charging by the hour.
4. Put Yourself in the Customers’ Shoes
To differentiate your business by placing a greater emphasis on customer service, you have to put yourself in your customers’ shoes. Think about how they will use your products or services, what their needs are and how you can act in their best interests.
As Danny mentions in the interview, Contango IT’s consultants and technicians are always looking out for the customers’ interests and making the sort of decisions they would personally make if they were working in that company. While other IT companies may recommend products that will make the most money and have the most recurring monthly fees, Contango IT focuses on giving customer’s the solutions they really need.
5. Demonstrate Your Core Values
Your differentiation should be built into your core values in a meaningful way that lets you demonstrate to clients how you are different. Saying your business is different because you are ‘honest,’ ‘a trusted partner,’ ‘focused on customer service’ or any other generic core value is not good enough – you need to go a step further and really show customers how you are different.
Two of Contango IT’s core values that differentiate them from others in the industry are accountability and transparency. One way they demonstrate this is through a custom portal they built that allows a client to log in and see what the technicians, consultants, and engineers are doing in 15-minute intervals. By doing so, “Our clients can’t spend a dollar without seeing how or why it was spent.” The system demonstrates the core values of accountability and transparency that make Contango IT different from its competitors.
6. Develop Your Team
Finally, everyone who works at your company must be on board with the company’s mission. They have to believe in the core values, understand how the company is different from competitors, and carry out that differentiation in their personal interactions with clients.
Danny says they have worked hard to build the right team at Contango IT. They recite the core values every Friday and participate in team-building activities to develop comradery. “We’re a team here. We work together and support each other, and we all are on the same page of doing the right thing by the clients and building a better business.”
If you can successfully differentiate your business, you will build your reputation over time. You will stand out in the industry as a company that is doing things differently and offering a better customer experience. As Danny has found, differentiating the business has led to a strong client base that is engaging in word-of-mouth marketing. Over time, Contango IT has been able to expand its services and nurture long-term clients.
Credits: Smart Hustle
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