In a Crowded Market, How Do I Create Brand Differentiation?

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“We’re in a crowded market.  We have no meaningful advantage, and if we did, someone would copy it by next Tuesday.  So how do we create brand differentiation?”

This question, or some version of it, is one I’ve been asked most often in my 20 years of brand strategy consulting.

The good news: There’s always an answer, and I’ll point you to several areas of exploration.  The bad news: It won’t be easy.

Brand Differentiation: The Simple Truth

We must begin with a humbling truth: Many brands have no meaningful point of difference.  Which is to say many brands are in trouble.  Because in branding, if you’re not different, you’re dying.

I’ve been asked, “Where do we find our differentiation?”  But brand differentiation isn’t something you find.  It’s something you create.  It’s about clear decisions and consistent actions.  It’s hard work, which is why most brands aren’t very good at it.

And that’s exactly why you need to do it.  If it were easy, everyone would do it.  The brands that win are the ones that do the difficult things over the long term.

Starting Points for Brand Differentiation

So if we want to create true brand differentiation, where do we look?

Here’s where NOT to look: “Lowest price.”  Unless you have a business system that can beat Walmart and Amazon – and I’m going to presume that you don’t – you need to look elsewhere.

Nordstrom Macy's Brand Differentiation
Both are department stores, but they’re more different than similar.

Remember that difference is most often found not in WHAT you do, but in HOW you do it, and FOR WHOM.  Nordstrom and Macy’s are both department stores.  But they differ considerably in how they conduct their affairs.  And they attract and serve different kinds of shoppers as a result.

That’s your starting point.  If in doubt, ask: How can we improve the lives of those we serve?

Brand differentiation improve lives

Eight Areas of Exploration

More good news: Brand differentiation has many sources of inspiration. I invite you to consider these eight areas of exploration:

  1. Your deep knowledge of your humans. Strong brands serve a particular group of people.  (And if you don’t have a clear sense of whom you’re in business to serve, there is positioning work to do, immediately.)  P&G historically has been excellent at turning consumer insights into differentiated brands.  What insights do you possess, and how can you build on these insights to serve your humans?
  2. Your purpose and passions. What’s the change you want to bring to the world?  It doesn’t have to be pie-in-the-sky.  For example, Boka Restaurant Group has a palpable commitment to hospitality.  No matter which of Boka’s Chicago restaurants you find yourself in, you can count on excellent service.  In a world where good service can be hard to come by, it’s a legitimate point of difference.  What’s the dent you want to make in the universe?
  3. Your values. Nobody cares about the values you claim to have.  Nobody cares about the values you hang in your lobby or stick on your website.  People only care about the values you put into motion.  What do you stand for as people, and how does that sing in your work?
  4. Your story. Why are craft brewers are making such strong gains on the majors?  They have more interesting stories.  (Not to mention a better experience, which we’ll discuss next.)  It can be helpful to return to the roots and history of your company, bearing in mind that the truth beats marketing mythology.  What’s genuinely compelling about your story?
  5. Your experience. Your experience is more than your product or service.  For example, many craft brewers have tasting rooms featuring a range of well-crafted beers, some of which are only available on-location.  There may be communal tables, live music or above-average pub grub.  The guy pouring your beer may be a vivacious chap, or he may be an insufferable blowhard.  That’s part of the experience too.  What’s unique about the experience bundle you provide?
  6. Your level of quality. Despite what you may have heard, top-quality products or services can still carry the day.  Here in Chicago, two very different restaurants, Au Cheval and Kuma’s, often have lines out the door.  And for what?  Their burgers.  Good old, commoditized hamburgers, elevated to a higher level.  As Seth Godin says, “When in doubt, make better tacos.”  How can you take the ordinary and make it extraordinary?
  7. Your strengths. Say what you will about McDonald’s these last several years – and I have – but its legendary growth was a function of operational strength.  Strengths come in many forms.  What do you do better than anyone else?
  8. Your industry rules. Fifty years ago, Southwest Airlines broke nearly every established “rule” with its business model.  The outcomes?  Industry-leading profits and a clear competitive positioning.  What are the “rules” you can break?

Brand Differentiation Matthew Fenton

Putting It Into Action

Use these areas of exploration for a strategic deep-dive, or for interactive exercises with your team.  Be sure to move beyond nebulous platitudes and into the specifics of strategic initiatives.  It’s one thing to say, “We’ll be the brand that stands for X!”  It’s another thing to define exactly how you’ll bring “X” to life, and how that will permeate everything you do.

On that note: If you’ve made bold choices, you shouldn’t have to worry too much about competitive imitation.  It’s fairly easy to copy a product feature.  But it’s nearly impossible to duplicate an entire value chain.

Brand differentiation creating value

And, ultimately, that’s what brand differentiation is about: Creating value.  The above areas of exploration point to the key strategic questions: Where will we play? And how will we win?  And so they imply focus and commitment.  They imply real change.

After all, you can’t create differentiation by talking about it for a bit, and then going back to the same stuff you’ve always been doing.

About Matthew Fenton: Matthew helps challenger brands to focus, grow and win.  Since founding his consultancy, Three Deuce Branding, in 1997, he’s helped hundreds of brands, including Wrigley, Valvoline and Fidelity Investments, to achieve “brand clarity.”  His consulting services and speaking engagements help brands to focus on what matters through positioning, strategy and ideation.  Contact Matthew here.  He’s based near Portland, in Oregon wine country.

Copyright 2018 – Matthew Fenton. All Rights Reserved. You may reprint this article with the original, unedited text intact, including the About Matthew Fenton section.

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