So we have decided to differentiate, but how?
Well based on Dr Kotler’s work we can look at the marketing mix of Product, Price, Place, & Promotion.... This allows us to decide if our specific value is to offer a better product, or maybe a better way to consume that product, or perhaps a better way of advertising and marketing that product, or worst of all a “better” price (better for whom?). The fact is that we can choose from all these and blend them into an offering that is better than the competition. Many companies have learned that offering superior credit terms to their customers is a fine way to lock in that customer’s future business., however the pressure of extending credit competing with Visa et al is tough. The point is that you don’t have to have a super engineered mega version of a product to compete. In fact you have to be “just a little bit better” on a few fronts to win. In high tech, many folks get wrapped up in defining the best possible product, but I have found that the smart ones are the ones who look at the complete mix. Kenichi Ohmae’s work is to be recommended here, his insight on a focus on the key factors for success, can be combined with Porter’s industry analysis framework, and you can glean an idea on what you should do to differentiate your offering from the competition. Although Ohmae’s book talks about Japanese business, it’s applicable worldwide.