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Differentiate

Differentiate
July 14, 2011 John

How do you differentiate your construction business?

DifferentiateCompetitor differentiation is an important aspect of marketing for any business. The objective for ‘differentiation’ in the market place is to develop a position that potential buyers see as unique. But, that is not so easy.

What makes you different from the construction firm situated at the other side of town?ย  Why should potential clients come to you, rather than them?

Many construction firms make the mistake of dropping their prices in an effort to remain competitive.ย  This is not differentiation, this is simply an involvement in a price war, squeezing profit margins to the extent that many projects end up providing little profit at the end of the day. Winning a job ย on a low price and then building in the apparent extras as you go along will earn you a reputation; but not a good one.

Differentiation should be based on such aspects as a specialisation in a particular area, provision of services to a niche market or some kind of added client value, which no other competitor currently provides.

So, as a construction professional, you could perhaps ask yourself, are there any other like firms in your area marketing themselves as affordable housing specialists and introducing themselves to the local authority? ย Or perhaps you could pair up with a respected architect and planning professional to provide a โ€œone stop shopโ€, saving clients time and potentially money on sourcing appropriate professionals and project management.ย  If your cashflow allows, you could offer clients a โ€œpayment by instalmentsโ€ scheme, particularly useful as the property market slowly begins to take up the pace once more.

By singling out your construction practice and placing it firmly in the spotlight, you can begin to build a solid reputation, which will in turn trigger word of mouth referrals and more leads.ย  Donโ€™t simply assume that your current or past clients will automatically stay loyal to you. You may not be the cheapest practice in the area, but you need to demonstrate why new projects should come to you.

Service Excellence in ConstructionProducts and Services

It may be easier to differentiate with a construction product than it is with a service. After all, how are you different to your competitors? Can one builder or flooring company be different to another? Yes, I think so and here are my thoughts.

1. Value for Money: We have all read in the news lately of companies failing because their prices are so low (suicide bidding) that they end up going in to administration. The oldย adageย is true;

“It is unwise to pay too much, but it is unwise to pay too little. When you pay too much, you lose a little money; that is all. When you pay too little you sometimes lose everything. Because the thing you bought was incapable of doing the thing you bought it to do. The common law of business balance prohibits paying a little and getting a lot.

It cannot be done.

If you deal with the lowest bidder, it is well to add something for the risk you run and if you do that, you will have enough to pay for something better. There is hardly anything in the world that someone can’t make a little worse and sell a little cheaper – and people who consider price alone are this man’s lawful prey.” John Ruskin ย 1819-1900

2. Attitude: As a company, do you really care about your clients and customers? I recently asked a client this question. “Why are you in business?” Is it to make money, be profitable or do you say its my job! In part, it is all of those but more importantly we are in business to help others. Have this attitude and it will make a difference to you, your business and your clients.

3. Excellence: Pursue excellence in all you do! Business owners are finding it tough at the moment but all the more reason to do things well. Our clients do not expect us to be perfect but if there is a problem – solve it!

4. Personality: Your company has a ‘personality’ whether you like it or not. Company X is unfriendly, while company Y is friendly. Company X provides shoddy workmanship while company Y offers quality workmanship. Who would you choose? ย Be different in the right way.

5. Meet with people: This is true if you want to get on to a tender list and they have not worked with you before. Talk to them about your company experience and track record. Appointments are a key part of selling your own unique selling point. You can read more about appointments HERE.

There are other ways we can ย differentiate, but what are your views?