Traditionally, identifying competitive advantages means finding ways in which companies differentiate products and services. Being faster, better, more feature rich and cost effective are differences that drive product strategies, R&D efforts, marketing and advertising campaigns, sales approaches and collateral materials.
But, oh, how things have changed.
“It doesn’t matter what products you buy. Most products are now good enough to serve the majority of users most of the time,” says Simon Hayward, VP and Gartner Fellow.
Most products, especially those from the technology sector, do more than the average customer could ever use. Product manuals are inches thick. Just the number of features and functions, in some cases, make them too overwhelming to consider.
So how do you differentiate?
Competitive advantages are not dependent on a company’s ability to produce differentiated products and services, but how they engage and interact with their customers to become the best partner possible.
That’s right. It’s not about introducing the “next big thing.” We can’t all be Apple. In order to gain market share and protect/grow existing customer relationships, organizations must affect a shift in perception among their prospects and customers. They must move from being perceived as an “Approved Vendor” to being viewed as a “Trusted Advisor/Partner.”
CSO Insights, a highly respected research firm that surveys thousands of Chief Sales Officers representing a broad spectrum of businesses, defines Approved Vendor as “a company seen by the majority of customers as a legitimate provider of the products or services offered, but are not recognized for having any significant sustainable, competitive edge over alternative offerings.” A Trusted Partner is defined by CSO as “a company seen as a long-term partner whose contributions (products, insights, processes, etc.), are viewed as key to client’s long-term success.”
Data from CSO Insights Sales Performance Optimization Report shows that while sales performance improved in many areas last year, less than one-third of the organizations surveyed had reached “Trusted Partner” status. For companies achieving it, the rewards were plentiful. Nearly two-thirds of their reps met or exceeded quota, 90% met company plan while experiencing the lowest sales-force turnover rate.
So it turns out that you have to become the differentiator. You have to be the competitive advantage. You have to be an asset. That means your entire sales organization, from field to senior management, has to find ways to become indispensable to your customers. You have to bring more value in your interactions with them, finding ways in which you interpret the power of your products and services into measurable, strategic value to what they are trying to accomplish with their business.