How to Differentiate Your Product

You finally landed a sales job with your target company. You love the product and use it yourself, so you think selling it will be a no-brainer. But then you realize that, while your new employer’s product is great, there are competitors with some pretty good products, too. Instead of simply telling people how great your product is, you’re going to have to explain why it’s better than everybody else’s. And that means you have to understand what differentiates your product from those of your competitors.

First, let’s take a look at the main ways companies differentiate their products. Then we’ll talk about how you can use that knowledge when you talk to your customers.


One way a company can differentiate a product is price. They have to be careful, though. Sometimes price doesn’t matter, so the company could give up money for nothing. Pretend you’re selling new cars, for instance. A customer in the market for a BMW isn’t going to care that you’re selling Hondas for less than the guy down the street. In that case, differentiating on price would be a waste of money.

On the other hand, if a company can offer the same or equal product for less than everybody else, that’s meaningful differentiation. How can they do that? Either by planning for a lower profit margin or by getting/making their product for less:

  • Reducing overhead
  • Reducing the cost of sourcing your product/materials
  • Reducing transportation/delivery charges

Companies still have to be careful, though. Differentiating based on price is risky. You can’t stay in business if you don’t make money, and once you’ve gotten your customers used to low prices, they may resent it if you raise them later.


Differentiating on quality simply means that your product is better than everybody else’s. Companies can approach it a couple of different ways. One way is to offer a product that is better than other products in the same price bracket. Another way is to offer a premium product that customers are willing to pay extra for. Apple is an example of a company that has done a great job with this. MacIntosh laptops cost about twice as much (or more!) as Windows-based laptops, but a lot of people are willing to pay a premium because Apple has done such a good job of persuading people their products are superior.


Differentiating on services means the things you do for your customers beyond just selling the product. On the front end, that may mean consulting with your customer to come up with a custom solution. On the back end, it can mean any number of things:

  • A 24/7 customer support line
  • Same-day repairs
  • Just-in-time delivery of replenishment items
  • Training on the best or most innovative ways to use the product
  • Free product updates as newer versions come out

Social responsibility

Social responsibility is a newcomer to the differentiation game, but it’s a power player. More and more customers are choosing products based on social responsibility.

  • Is your sourcing environmentally sustainable?
  • How much do you pay your employees? What benefits do you offer?
  • What charities and/or social movements do you support?

The risk in using social responsibility as differentiation is that the practices some customers love are the very ones that will turn other customers off. It’s important to know your customers well before using this tactic.

Putting it to work

Once you’ve identified the factors that make your product different, you need to understand those factors inside out.

  • If your company differentiates on price, you need to be able to explain why you’re able to offer the product for less without sacrificing quality. You also need to be able to explain any factors that may affect price, like rising commodity prices, steps taken to meet new government regulation, etc. You have to be able to convince your customer that the lower price is significant and long-lasting enough to be the deciding factor.
  • If your company differentiates on quality, you need to be able to discuss quality from several angles:

o   How is your product better? What features are superior to those offered by your competitors?

o   Regarding the features that are better, what makes them better? Is it the material you use? The manufacturing process?

o   Why does that matter? What benefits will your customers see from those superior features?

o   How can your customer be confident that the superior quality is as good as you say it is? What are your quality assurance protocols? Do you have other customers willing to provide testimonials?

  • If your company differentiates on service, you need to be able to explain how your service is better. Do you have customer support available nights and weekends, when your competitors don’t? Do you make it easy on customers who have problems with the product, while your competitors make them jump through all kind of hoops to resolve issues?
  • If your company differentiates on social responsibility, you need to know your customer well enough to be confident that it matters. You also need to be certain that your customer shares similar values. Both companies, for example, may be very socially engaged yet have completely different positions on the issues they engage in.

Explaining how the product you’re selling is different from everybody else’s can be tough, especially if you’re in a field where all of the products are pretty much the same. The secret is to learn everything you can about your product and your customers. First, identify the things that make your product different. Then, identify which of those things are most important to your customer. The way to close the sale is to convince the customer that you’re a perfect match on the things that matter most.


photo credit: freeimages via sdesmond