Trade Tips
Here's How to Increase Your Profits ... with Product
Differentiation
A key to success in export markets, especially when a
business operates on a smaller scale than it's competitors, is frequently
product differentiation.
Where a business expects to produce at a higher unit cost than
it's competitors, it must be able to justify higher prices or accept lower
profits and the risk of being increasingly unprofitable.
Higher prices can only be justified if customers see and
believe the products are in some way
different to those offered by competitors.
You can create Differentiation from such things as -
-
presentation, including 1st impressions and timely response
- differentiates company as supplier
-
design & materials of construction
-
promotion, including "packaging"
-
product performance characteristics
-
durability & reliability
-
ease of operation
-
availability, warehousing, production & delivery times
-
after sales support & operator training
-
skills of sales and technical support staff
-
financing arrangements
How do your products score ? ....
-
Do buyers of your products believe your company and it's
product range is different from your
competitors and their products ?
-
How do you know ?
-
Have you conducted realistic unbiased market research to
confirm this ?
-
Are these differences seen as benefits by users, or obstacles
?
-
Are customers prepared to pay extra for your products in order
to obtain these benefits ?
-
Do these benefits apply across all potential users of the
products rather than there being
pronounced differences in customer perceptions & expectations in different
market segments ?
-
Can you use these differences to create market segments or
niches in which you have
significant sustainable competitive advantage ?
Your awareness of customer & prospect perceptions leads
to greater
profits.
Excelink can help you understand customer & prospect
perceptions.
Email: excel@excelink.com.au
Call Sydney 02 8213 3225 or
02 9957 1099 Melbourne 03 9017 6862 Brisbane 07 3137 1607 Perth 08 6364 3651
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