Product Differentiation in a B2B Market

Companies everywhere are struggling to differentiate their offerings. They dream of establishing an unassailable market position for their solutions, a position that will enable them to capture a lion's share of the customer's mind and wallet.

But, to their frustration, no matter how enticingly and expertly their portraits of the solutions are painted, to customers their solutions and their competitor's solutions usually end up looking amazingly alike. Painstakingly executed solution differentiation strategies end up becoming one-way tickets to the Value Gap and painful dry-run, no-sale scenarios.

Twenty years ago, Theodore Levitt declared: "The search for meaningful distinction is a central part of the marketing effort. If marketing is about anything, it is about achieving customer-getting distinction by differentiating what you do and how you operate [italics added]. All else is derivative of that and only that."¹

Sellers en masse have subscribed to Levitt's view. They first focused on the most obvious element of his distinction formula and attempted to differentiate based on the "what you do" part of the equation. They developed and marketed longer and even more esoteric lists of solution features. They also created ever more complex bundles of products and services.

This focus on solution benefits was legitimate, but two things occurred that eventually rendered it ineffective.

First, the competition quickly imitated the features that proved popular with customers and the distinction between solutions disappeared.

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Jeff Thull is president and CEO of Prime Resource Group (www.primeresource.com) and the author of Exceptional Selling: How the Best Connect and Win in High Stakes Sales (September 2006), The Prime Solution: Close the Value Gap, Increase Margins, and Win the Complex Sale (Dearborn Trade Publishing, 2005) and Mastering the Complex Sale (2003).