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Is Differentiation Working Against You?
Added Value Must be Actually Needed by the Customer

April 2017

Chris McDonell, President of McDonell Consulting Group, a licensed Sandler Training center based in Baltimore, has over 25 years of experience in sales and executive leadership. He has formed successful partnerships with both small and large companies in a wide variety of industries. Connect:

In an effort to establish uniqueness and differentiation, companies push the boundaries of technology, innovation and out-of-the-box thinking to add unique selling features to their products and value added aspects to their services. As products and services become more feature-rich, they also become more complex – perhaps beyond the perceived needs of prospective customers.

Due to the rapid pace of technology and communications, what is unique today is not unique for long. What one company offers today, several more will offer tomorrow. Even in the case where a company has a jump on its competition, if the prospect doesn’t fully comprehend the uniqueness or perceive the need for the performance benefit of the added features, then the product still looks the same as the competitors’ products. Ironically, it is the “uniqueness” of the product that turns it into a commodity in prospects’ eyes. (A mobile phone by any other name is still a mobile phone.)

If added performance is not important (or perceived to be important), on what elements are buyers making buying decisions? Functionality, reliability, deliverability, convenience and simplicity – the very same elements they considered before technology and innovation entered the scene. But now, they are getting “added value” for which they neither perceive a need nor desire to pay extra. So, price, the element of the buying decision companies were hoping to downplay with the value-added features and services, becomes the element on which buyers now focus.

“Added value” is only added value if the prospect acknowledges a real (or perceived) need for the particular aspect of the product or service. Without the acknowledgement, the added value becomes added expense in the prospect’s eyes and a reason to negotiate price or reject the product.

You are not responsible for the added value features and services. But, you are charged with making the sale. So, what can you do?

First, recognize that added value elements, whether they are product features or added services, are but one aspect of the sale and are only important to the degree to which prospects perceive their need and want them. You must focus on prospects’ problems to be solved and goals to be accomplished before giving thought to all the wonderful, innovative and technologically advanced selling points of your product or service. You must make the shift in your own mind and in the eyes of your prospects, from vendor to advisor. You must diagnose before you prescribe.

Learn as much as you can about your customers and prospective customers. Look at their worlds through their eyes. Identify their challenges and goals. Determine what drives their businesses, what they value and in what directions they are moving. Find out what “drives” the buyer as their goals and values may not be in perfect alignment with his company. Some aspects of your product or service may hold a different priority for the buyer. When you take the time to uncover this information, you will know which added value elements of your product or service are likely to be of interest and importance to the company and the buyer and you will know how to best position your product or service. Does this differentiation trap only apply to feature-rich products or services that are driven by technology and innovation? No.

You can fall into the trap just as easily with ordinary products or services. How? By attempting to differentiate your product or service with any added value element that isn’t directly related to buyers’ real or perceived needs. Regardless of how you position those features, buyers know there is an associated cost and the money to cover the cost will be coming out of their pockets.

You must view prospects’ problems, challenges and goals through their eyes. Then you can determine which of the added value elements of your product or service will help you design an optimal solution.

Differentiation is not about how many added value elements your product or service has. It’s about how specific added value elements specifically address the needs of the prospect. Until that happens, it is a roll of the dice. I95 Content Marketing