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Marketing as the primary differentiator 2

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Vladimir Milanovic
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Let’s face it, we’re all in the marketing business. Being different can be regarded as one of the basic human needs. We live in an over-communicated world and in order for their voice to be heard, people often make bold statements. Quite often it’s nothing more than repackaging somebody else’s truth, or oversimplifying it to appeal to a wider audience.

One of those truths that stick with me and that I come across occasionally is that product IS the marketing. While this sounds like a sensation, there is more to it beneath the surface. If we think of marketing as understanding the wants and needs of the target audience and creating the product or service that will satisfy those needs in a profitable way, then yes, product IS the marketing. At least it is one of the vital components of that process. The meaning of this is where most people get confused. You have to do your research, understand your target audience and deliver the product that is so good that it virtually sells itself. It is then easy to communicate the awesomeness of that product, as it speaks for itself.  But what to do with your existing portfolio?

“Distinct or extinct”

Regulated industries demand a certain level of standards to be met when it comes to a product or a service, resulting in a very similar offering across that vertical. Given that it’s all “same same” what is it that is going to differentiate one company from another?  I have often seen companies trying to be “better same”, failing to find their own unique story. Being better is not the same as being different. Differentiation through marketing positioning is a sound strategy if you operate in a highly competitive market where there is little or no space for innovation. We’ll cover the following key issues in differentiating and positioning the market offering:

  • Tools for competitive differentiation
  • Developing a positioning strategy
  • Communicating the company’s positioning

Tools for competitive marketing differentiation

Michael Porter defines differentiation as “…the act of designing a set of meaningful differences to distinguish the company’s offering from competitor’s offerings.” The key word here is “set” of differences, meaning differentiation can be achieved through a number of different aspects, more precisely in careful combination of differences. Depending on the type of industry you’re in, some dimensions of differentiation will fit better than others. It is achieved through:

  • Product itself – highlighting physical features, emotional or rational benefits, performance or quality of production. (Remember the statement “Product is the marketing”).
  • Services that accompany marketing, sales and after sales – the easiness of buying the product, delivery, installation, customer training and support.
  • Personnel differentiation – reliability, credibility or expertise of the people who interact directly with a customer.
  • Channel – focusing on reach and coverage of the services and products, expertise of your channel and experience.
  • Differentiation through image – it is how the market perceives you, as opposed to how do you want to be perceived. It delivers the emotional power and establishes your value proposition.

Creating marketing positioning strategy

Nothing comes free and that is true even for differentiation. You can create as many differences as you want but each has a cost that a customer needs to pay for in order to receive the benefit that difference brings. The trick is to pick the ones that bring more value than the cost to the customer, that is to a sufficient number of customers. A major characteristic of your new difference is that it needs to be superior and hard to copy. The benefit you decide upon might not be as original and others may use it as well. In that case, the importance is on how you communicate your benefit.

Choosing the right differences is certainly the key to establishing positioning and unique value proposition. Make sure you understand your competitors’ positioning before you make your decision. Positioning in simple terms is a sum of your differences. It is the result of your differentiation decisions. But before any decisions, make sure you understand your competitors’ positioning first.

Positioning is the process of designing the offering and its identity that will occupy distinct position in the minds of the target audience. The end result of the positioning exercise is the value proposition, a concise statement why a target customer should buy the product. This is the blueprint for advertising and overall communication strategy.

Marketing communication strategy

Once you have created a clear positioning strategy, you need to develop a set of tools and activities that customers use to confirm that the product delivers the promise stated in the value proposition. Those come in the form of advertising, direct marketing, personal selling, public relations, sales promotions, word of mouth, etc. Before buying advertising space in a fancy magazine, a strategy to coordinate different media and communication channels needs to be established, in order to integrate communications and deliver a consistent message across all channels.

People are usually mostly concerned with advertising and do not realise the preceding marketing activities that need to be conducted in order for advertising to be successful. Proper market research and understanding the target audience and the competition are still inevitable steps to be taken by anybody who is serious about its business. Sheer determination and willpower to succeed are not enough to make you stand out, if you neglect these basic principles of the market.

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About Vladimir Milanovic

Vladimir Milanovic
Vladimir has been working with GCOMM since 2010 on the design and implementation of the recent branding and marketing strategies. He was also responsible for the rebranding of LiveBackup in 2012. Between 2006 and 2010 he was involved in the creation and launch of Imperial Tobacco’s European BTL platform for its Davidoff brand as well as for the rebranding of French icon, Gitanes. Vladimir graduated from the Belgrade University of Arts in 2005.
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  • There is no doubt creating differentiation is tough particularly without serious capital or some sort of patent. If its a low cost differentiation maybe you can buy some time to get ahead but the competition will soon copy if its creates a positive benefit. Thanks, i always enjoy reading these marketing articles. Without marketing in competitive industries i don’t know what the differentiation is

    • Let’s not forged that companies must deliver the promose. Marketing is there to guide the way but internaly a company must adapt to live the promose and keep the positioning.