Category Archives: business strategies

My visit to Sedona – AZ

I recently celebrated my birthday in Sedona – a city that straddles the county line between Coconino and Yavapai counties in the northern Verde Valley region of the U.S. state of Arizona.

Sedona’s main attraction is its array of red sandstone formations. The formations appear to glow in brilliant orange and red when illuminated by the rising or setting sun.

Start with scenery that makes your heart leap. Sedona nestles among a geological wonderland. Multi-hued stone formations jut upwards from the high desert floor creating a vivid, mesmerising setting that changes hourly with the light. When USA Weekend compiled their Most Beautiful Places in America list, no surprises that Sedona claimed the top spot.

Surrounded by 1.8 million acres of national forest land, visitors have instant access to recreational activities. Trails for hiking and biking, along with bouncy jeep tracks, weave among the bristling forest of pinnacles, spires, buttes and domes.

Sedona has inspired me for a decade, its sheer beauty, magnificence and it is a great place to reflect and expand your thinking.

(continued after this gallery)

A good friend, spoke to me this morning and discussed the quote: “Sometimes life is about risking everything for a dream no one can see, but you”. Powerful words, but exactly how many of us genuinely would risk everything for the dream?

By the way, I speak with words of wisdom on the subject, for those readers who have read my first book ‘Freedom after the Sharks’, you will know that this book was written on the basis of a non-fiction and true story, at the time this book was published and still today you will find very few authors very rarely explain the true journey of their life, I have never truly understood why people want to erase or try to forget adverse experiences, (by the way, research shows that you cannot choose to forget or erase life experiences) these are the very moments that we learn and whilst we may not understand why we are being forced in a certain direction, through these experiences we will build strength of character.

If your life choice is to leave a relationship, move to a new city or change country, leave a secure job or to set up a new business, many of us find ourselves facing big life decisions with little or no tools to help us make the best choice.

Sure, you can ask family and friends for their opinion, but often you leave those conversations more confused than when you started, you will always be the adviser with the most wisdom, your intuitive self will always have the right answer, whether you choose to listen or not.

You have a natural knowing within you that transcends logic, reason and experience and most definitely other people’s opinions. The problem is that most of us haven’t been taught how to access or trust our inner wisdom.

Because in my experience, whether I succeeded or failed was irrelevant once I was clear that the path I was taking was truly what was driving me as a person. I owned it and knew with 100% certainty that no matter what happened, I made the best decision for me, in life I have never had any regrets only life experiences that has made me the person I am today.

Whether life is telling you to be a Fighter Pilot, a Michelin chef, an Accountant or the world’s next Fin-Tech billionaire, you will need to ask yourself a few questions…..

Do you have the experience or are you prepared to retrain for your quest?
How hard are you prepared to fight for what your heart’s desire? Being truly successful means putting in the work to forge ahead. For careers that require qualifications, for the entrepreneurially minded it means rolling up your sleaves, working all hours and sacrificing the little luxuries until your idea/s begins to fly. Climbing the career ladder? Be prepared to start at the bottom and anticipate doing your fair share of tasks, tenacity, determination and nerves of steel are a prerequisite.

Have you just woken up with the big idea?
Success is born out of passion and there is no easy answer, no short cuts. It will be harder to reach than you first envisage. What are your strengths? What are the activities that make your heart dance, what drives you as a person? What profession motivates so much every day that you would never want to stop, regardless of your age and retirement?

The power of the relationship
Your friends, your colleagues, your associates and your loved ones need to support your idea/s their commitment and support is an imperative. Making things happen also means being a part of the business community, you need to introduce yourself to many people. Whether it is making contact with prospective employers, scouting for clients and collaborators, attending networking events or promoting yourself online, people need to know what you’ve got to offer if they’re going to help you succeed, and you absolutely need a mentor and confident.

Finances
The Idea/s are powerful but you need to have a roof, pay bills and food. If you are starting your own business then sooner or later you are going to going to need to generate invoices and the management of actually being paid. This can leave you in a tight position to get things up and running without a proper runway for operating and this is where many people and business ideas fail. The solutions are as varied as the challenges. You could look to friends and family, angel investors or seek loans or grants, do go to my website and download the free capital raise handbook for business development and growth, http://www.hsbusinessmanagement.com/

Maya Angelou once said:

“My mission in life is not merely to survive, but to thrive; and to do so with some passion, some compassion, some humor, and some style.”

So exactly how do we value time?

intelligent-use-of-time

I recently had breakfast with a senior partner of an exceptional accounting firm in London, he is a personal friend and associate, we often meet to discuss many strategic topics and met to discuss my new book, “Meaningful Conversations”. During the course of breakfast we decided to focus on one of his questions: ‘What is the most valuable commodity we all have today?’ The answer I gave was ‘time’.

So, what exactly is time and how do we qualify time?

According to Wikipedia, Time is the indefinite continued progress of existence and events that occur in apparently irreversible succession from the past through the present to the future. Time is a component quantity of various measurements used to sequence events, to compare the duration of events or the intervals between them, and to quantify rates of change of quantities in material reality or in the conscious experience. Time is often referred to as the fourth dimension, along with the three spatial dimensions.

Actually, time is something none of us can get more of, so the management of time is one of the most important aspects of what you need to do as a purposeful leader.

One of the best analogies you can use in your company regarding time is asking your employees to equate one hour of time to one pound. When I was in corporate management, I would ask my directors who entered my door:
1. Is that a one pound decision?
2. One hundred pound decision?
3. Or a one thousand pound decision?
If they would answer option 3 they could take a seat.

It really is helpful to look at your time just as you look at investing your money. Because, in essence, you are looking for the same result: you are looking for the best return on your time.

Taking this thought process one step further, let’s ask the question, “Who am I spending my time with?” All too often, managers spend their time where the problems are, not where the results are. While we need to deal with problems, we want our focus to be on results. Our job as leaders puts us in a position where we have to deal with problems and poor performance. But we need some parameters to help us understand both the issue of time and the investment of time.

One of the most touted management/leadership teachings out there is: “Spend 80 percent of your time with your top performers.” Another is: “Your team should be measured based on the 20 percent top performers, 70 percent role players and 10 percent poor performers.” In theory, I agree. But I think these teachings fall short. Not enough is written, or taught, about the critical 80 percent of your workforce and how to improve their performance through minimum performance standards.

Time is seen in a particularly different light by Eastern and Western cultures, and even within these groupings assumes quite dissimilar aspects from country to country.

In the Western Hemisphere, the United States and Mexico employ time in such diametrically opposing manners that it causes intense friction between the two peoples.

In Western Europe, the Swiss attitude to time bears little relation to that of neighboring Italy.

Thai’s do not evaluate the passing of time in the same way that the Japanese do. In the UK the future stretches out in front of you. In Madagascar it flows into the back of your head from behind.

Let us begin with the American concept of time, for their’s is the most expensive, as anyone who has had to deal with American doctors, dentists or lawyers will tell you.

For an American, time is truly money. In a profit-oriented society, time is a precious, even scarce, commodity. It flows fast, like a mountain river in the spring, and if you want to benefit from its passing, you have to move fast with it. Americans are people of action; they cannot bear to be idle. The past is over, but the present you can seize, parcel and package and make it work for you in the immediate future. In the U.S. you have to make money, otherwise you are nobody. If you have 40 years of earning capacity and you want to make $4 million, that means $100,000 per annum. If you can achieve this in 250 working days, that comes to $400 a day or $50 an hour. With this orientation American’s can say that their time costs $50 an hour. Americans also talk about wasting, spending, budgeting and saving time.

This seems logical enough, until one begins to apply the idea to other cultures. Has the Portuguese fisherman, who failed to hook a fish in two hours, wasted his time? Has the Sicilian priest, failing to make a convert on Thursday, lost ground? Have the German composer, the French poet, the Spanish painter, devoid of ideas last week, missed opportunities that can be qualified in monetary terms?

download

The Americans are not the only ones who sanctify timekeeping, for it is practically a religion in Switzerland and Germany, too. These countries, along with Britain, the Anglo-Saxon world in general, the Netherlands, Austria and Scandinavia, have a linear vision of time and action. They suspect, like the Americans, that time is passing (being wasted) without decisions being made or actions being performed.

These groups are also monochronic; that is, they prefer to do only one thing at a time, to concentrate on it and do it within a fixed schedule. They think that in this way they get more things done — and more efficiently. Furthermore, being imbued with the Protestant work ethic, they equate working time with success: the harder you work — the more hours, that is — the more successful you will be and the more money you will make. This idea makes perfect sense to American ears, would carry less weight in class-conscious Britain, and would be viewed as entirely unrealistic in Southern European countries, where authority, privilege and birth right negate the theory at every turn. In a society such as existed in the Soviet Union, one could postulate that those who achieved substantial remuneration by working little (or not at all) were the most successful of all.

Richrd Lewis who wrote “When Cultures Collide” has a view that in countries inhabited by linear-active people, time is clock- and calendar- related, segmented in an abstract manner for our convenience, measurement, and disposal. In multi-active cultures like the Arab and Latin spheres, time is event- or personality-related, a subjective commodity which can be manipulated, molded, stretched, or dispensed with, irrespective of what the clock says.

“I have to rush,” says the American, “my time is up.” The Spaniard or Arab, scornful of this submissive attitude to schedules, would only use this expression if death were imminent.

In a Buddhist culture (e.g., Thailand, Tibet), not only time but also life itself goes around in a circle. Whatever we plan, however we organize our particular world, generation follows generation; governments and rulers will succeed each other; crops will be harvested; monsoons, earthquakes and other catastrophes will recur; taxes will be paid; the sun and moon will rise and set; stocks and shares will rise and fall. Even the Americans will not change such events, certainly not by rushing things.

Cyclic time is not seen as a straight road leading from our feet to the horizon, but as a curved one which in one year’s time will lead us through “scenery” and conditions very similar to what we experience at the present moment. Observers of cyclic time are less disciplined in their planning of the future, since they believe that it cannot be managed and that humans make life easier for themselves by “harmonising” with the laws and cyclic events of nature. Yet in such cultures a general form of planning is still possible, for many things are fairly regular and well understood.

As a business leader, you must understand the value of making a time management decision on where to spend your time to get the most beneficial results for your company. Your top 20 percent will always perform at a high level, and you do need to devote time to coaching them to even greater success. That’s a very good use of 80 percent of your time and effort. The other 20 percent of your time, focused on the remaining 80 percent of your workforce or team, should be used to establish, communicate and promote the minimum standards for working at your company. The message you want to communicate is, “You have to work at a certain level if you want to work here.” You must clearly establish that you no longer allow employees to come to work and just exist without being accountable to minimum standards.

If you adopt this concept, you will find that 80 percent of your employee base will contribute to the growth and success of your company or department, and your top 20 percent performers will be inspired to try even harder. The point is, your top performers will always perform at a high level. You do need to invest your time with them to coach them to even greater success. Using the remaining 20 percent of your time to raise the standards of the other 80 percent of your employees will create an environment of incremental growth through your largest body of employees.

What is the conclusion around the true worth of time?

My belief is, know your value and do not accept being treated in a way less than you deserve. You must have realistic expectations, demands and a sense of entitlement. I am saying that as an individual you need to be treated the way you treat others, and vice versa. The minute you negotiate your self-worth and accept less, you say to the universe that you do not deserve any better, and the vicious cycle/patterns will start to begin. Change for yourself and of course, friends and partners are a great mirror reflections that help you grow.

Finally, time is not money, the truth of the matter is ‘the time is money’ adage has got us all into a lot more trouble than we realise. Because we live our lives based on the misleading premise that time is money, we attempt to do more in less time. We begin to confuse activity with productivity, as if the ‘doing’ will grant us ‘being’. Inadvertently, we jump on the hamster wheel, running as fast as we can with a competitive mentality about the clock and what it supposedly represents in our lives and in the lives of others. We have a negative relationship with time that gives us a sense of time starvation instead of abundance. Even our precious vacation time is not immune from the time-money equation.

This quote is an inspiring reminder:

“But the most exciting, challenging and significant relationship of all is the one you have with yourself. And if you can find someone to love the you, you love, well, that’s just fabulous.”

Quantity business relationship vs quality business relationship

quality_quantity

While businesses tend to want as many clients as they can get, what good would getting the client be without the ability to retain them? If a business is busy taking on too many projects to produce quality products and services for their client, it’s likely that they will lose them. On the other hand, if a business paces itself and spends quality time making new connections and building relationships, they are more likely to retain the relationships and be able to move forward with the next ones.

Even though large quantities can appear as an alluring and successful sign of business, it’s easy to imagine how many clients of a quantity-focused company are not satisfied with the product or service and will not return to or stay with the company. Taking the time to build rapport with clients will increase your company’s substantial business, in turn building your company’s brand and clients’ trust. In a competitive business world, quality leads to quantity.

Michael Simmons’ Forbes article titled “The Most Important Decision You Need to Make When Building a Network”, I feel tackles the questions we are all wondering when it comes to establishing relationships. Creating an extensive network, both personally and professionally, is tempting, but it brings up the age-old dilemma: “Quality or quantity?”

Initially, growth is both essential and inevitable. But at what point does expansion begin to hinder progress?
Research shows, after immense growth, it is essential to re-evaluate your network. Once you have reached capacity, a large-scale network becomes inefficient and difficult to maintain. In order to combat this, it is important to understand that as networks increase in size, quality becomes much more important than quantity.

Instead of forcing expansion, it becomes more beneficial to establish close, valuable relationships. At that point, we must then decide which relationships are most important so that we are best able to foster and encourage their growth.

Focusing on quality should be foundational for any business and extend from the design of the website to the latest product hitting the shelves. The quality vs. quantity debate can be relevant to every aspect of your business. Do you want to optimize your sales processes, marketing efforts, employee happiness and every other attribute of your business? Of course you do. Here are 5 tips to increase business whilst maintaining quality relationships

1. Increase sales with higher quality leads.
The quality of your customer data affects every subsequent step in your buyer pipeline. It’s about more than just accuracy. Low quality leads waste your team’s time on research, data entry and chasing dead ends. High quality leads facilitate better reporting, automation and segmentation.

2. Ensure all products/services are flawless.
One quality product or service is often worth at least 100 mediocre alternatives. Have you ever noticed that luxury boutiques have many fewer shelves than the big box stores? Not only do boutiques usually have higher quality, but they also have more loyal customers, higher sales points and are generally a much more reasonable venture for a startup or the small business owner.

3. Don’t take SEO shortcuts.
If you know about search engine optimisation (SEO), you have probably heard about black hat tricks. These are illegal moves to falsely bolster the apparent popularity of a website, and they are almost always a short-term hack until search engine algorithms catch them and penalise them. A common trick is duplicate content and/or duplicate sites. You might suppose having multiple sites with the same content can boost your SEO rankings, but it can ultimately be your undoing. Focus on one very high quality site instead of several lower quality ones.

4. Nurture relationships with premium employees.
Both high skilled employees and mediocre ones may leave your company, but the loss of top employees could hurt much more. You know who your most talented workers are, so do what it takes to keep them long term. Offer workplace programs and benefits that show employees you respect their personal growth and long-term professional goals. This will help to ensure they don’t move on before you expect.

5. Go with targeted marketing campaigns.
Be a sharpshooter with your marketing. It’s more effective to take the time to research, pinpoint and create a marketing campaign for an appropriate demographic rather than pay for thousands of inserts in the biggest newspaper in town. It’s the difference between hunting your prey in the wild and setting up for that perfect shot, or wildly shooting a machine gun into the woods.

In conclusion, quantity versus quality applies to almost everything in your business. When you think of quantity versus quality what comes to mind for you?

When I think about quantity I think about things like McDonald’s – fast food, get through fast, inexpensive, fast paced, high volume.
When I think of quality I think about The Cinnamon Club – slow, nice high-quality environment, higher price point, more luxurious, more elegant.

The reality of those differences is what makes one a quality experience versus a quantitative experience.

Quantity is really important – it may not be too exciting, but if you learn to get intimate with your numbers and you learn how to break them down, your quantitative numbers will show you a direct correlation to qualitative behavior that can drive the quantitative results.

Calvin Coolidge once said:

“Knowledge comes, but wisdom lingers. It may not be difficult to store up in the mind a vast quantity of facts within a comparatively short time, but the ability to form judgments requires the severe discipline of hard work and the tempering heat of experience and maturity”.

10 ways to start 2017 on a positive note

images

As someone reminded me recently at a conference, agility is a very positive thing. Apple didn’t create the first digital music player, the first smartphone, or the first tablet computer, yet it came to dominate each category. Amazon wasn’t the first to sell books on the Internet, either. These companies succeeded not because they were faster, but because they developed products that were demonstrably better than their competitors.

2016 was a milestone year, let’s have a look at some of the year’s achievements:
March – Microsoft released a bot framework at BUILD
April – Facebook opened its Messenger platform at F8, and Telegram announced a prize for bot developers
May – Google announced its own Allo Messenger and voice-enabled home speaker at I/O, and Amazon made the successful Alexa accessible via a browser, without Echo hardware.
June – Today at WWDC, Apple opened up iMessage to third-party integrations and announced the Siri SDK
September – Salesforce adds AI: The new Einstein features will be able to deliver more predictive and personalised customer experiences across sales, service, marketing, commerce and other areas.
November – The announcement comes a day before Microsoft is widely expected to release its Skype Teams messaging app. Slack has also been busy in recent weeks making moves to integrate with Microsoft Bot Framework and IBM Watson artificial intelligence services.

But truly great companies don’t scramble to adapt to the future, because they create the future. Take a look at any great business and it becomes clear that what made it great wasn’t the ability to pivot, but a dedication to creating, delivering, and capturing new value in the marketplace. The technology companies that endure are the ones who spend years — or even decades — to create the next generation of products.

Which brings us to something else Theodore Levitt said, “People don’t want to buy a quarter-inch drill, they want a quarter-inch hole.” Clearly it is not a particular business category that defines a company, but its ability to solve problems for its customers. And you can’t solve really tough problems by simply moving faster. Great companies prepare the ground long before. Great businesses can be launched any time, even when there’s a downturn in funding.

While the start of 2016 might have spelled trouble for some well-established start-ups, it also saw the birth of companies tackling things like a cure for cancer, superfast internet, and competition for Uber.

Business Insider, http://uk.businessinsider.com, spoke to founders and venture capitalists and took a look at funding data to identify some of the start-ups that had the biggest starts in 2016.

Some names on the list are officially launching out of stealth, while others are still in their early months of forming a company.
Valuations for venture-backed companies doubled over last year to an average of $100 million, the highest in more than a decade, according to Pitchbook, a private financial-market data provider. Total venture dollars invested are on track to hit $74 billion in 2016, second only to 2015 over the past decade. And venture capitalists are basking in their best year since at least 2006, expected to end the year with $32.4 billion after raising $9 billion in the third quarter.

Here are 17 of the top start-ups to launch in 2017
1) Starry – is making more powerful Wi-Fi for your house. Website: https://starry.com
2) Juicero – wants to make the freshest juice you’ve ever tasted. Website: https://www.juicero.com
3) Cheddar – is betting it can be the new CNBC for millennials. Website: http://www.cheddar.com
4) Grail – wants to develop a test for cancer at the earliest possible stage. Website: http://www.grailbio.com
5) Juno – wants to be a driver-friendly alternative to Uber. Website: https://www.gojuno.com
6) Otto’s – self-driving trucks could revolutionise the industry. Website: http://ot.to
7) Simple Habit – wants to help stressed-out millennials. Website: http://www.simplehabitapp.com
8) Comparably – can show you how much you’re being paid compared with your peers. Website: https://www.comparably.com
9) Zipline’s – drones parachute blood and medicine to remote Rwandan cities. Website: http://flyzipline.com/product
10) Nanit – is a super powered baby monitor. Website: https://www.nanit.com
11) Truebill – wants to stop you from getting ripped off on subscriptions. Website: https://www.truebill.com
12) Winnie – wants to be the Yelp for parents. Website: https://winnielabs.com
13) Ritual – is making a better vitamin. Website: http://ritual.com
14) Recharge – lets you rent hotel rooms by the minute for whenever you need a rest. Website: https://recharge.co
15) Lola – is a new kind of a travel agent. Website: https://www.lolatravel.com
16) Pearl – will help turn your ‘dumb car’ into a cutting-edge model. Website: https://pearlauto.com
17) KnuEdge – wants to one-up Google and Intel. Website: https://www.knuedge.com

It is a fact that no business is guaranteed to succeed. But with the right level of energy, passion, determination to a belief in yourself and your product/service you can progress independently with your dream idea and business.
The beginning of the year has arrived and while it’s important to take some time to assess the positives and negatives of 2016, it is also worthwhile ensuring everything is ready for the year ahead so that 2017 does not start with unnecessary stress.

Many entrepreneurs are passionate about their chosen trade but aren’t always strong when it comes to the financial side of business. It is the little things that people often forget about. Simple things, like cash flow and budget that can make all the difference.

transform738-crop-600x338

The following 10 tips would make sure business owners cover all their bases and have a successful 2017.

1) Budget for the year ahead
2) Understand your business and its customers
3) Analyse your monthly management accounts
4) Keep your accounts and taxes up to date
5) Secure your IP/IPR
6) Know your limitations
7) Invest in good legal and accountancy experts
8) Build revenue streams with trusted relationships – no matter how small
9) Invest in cash recovery experts
10) Take a holiday and exercise every now and then

If you follow the tips you will see the benefits returned ten-fold.

As Henry Ford once said:

“Coming together is a beginning, staying together is progress, and working together is success.”

Why differentiation matters

product-differentiation

Potentially we have seen the biggest political landscape change in 2016, most recently with the news that Trump has been voted in as US president. This follows closely in the wake of Brexit and there is no doubt that this is the end, I am sure there are many more twists and turns to come. We are in an unprecedented period of accelerated global change which leaves the business community in limbo with a strong feeling of uncertainty.

Companies are in a challenging period, as the Chinese say: ‘We live in interesting times’ – seizing competitive advantage has never been so important for any size of company. With so much change it is difficult to ascertain what this purported change will mean for business, however, irrespective of the national and cross border challenges, it is important that entrepreneurial drive, spirit is maintained because SME’s who are driven for success will be trend setters that find new and unexpected opportunities from this geo political unsettlement.

It is this very flux that creates opportunity. Change favours the strategic, the agile and those who are prepared to shrug off the status quo, to adapt to change and potentially disrupt their traditional business model to turn adversity into success.

Predicting the future and identifying trends becomes critical to achieving competitive advantage and success. Leaders need to think strategically, creatively and most importantly, quickly. Organic growth is not the only solution; indeed, strategic partnership, joint collaboration and M&A moves centre stage in these disruptive times. Seeking efficiencies is no longer enough, they need to understand, predict and respond agilely to trends and underlying movements to stay ahead of dynamic market flow and change. For businesses to thrive, this must become second nature, business owners have to be in tune with the economic and business jungle drum, it is then they will be able to act with the speed required to create competitive advantage.

Product differentiation is essential too. It allows the seller to contrast its own product with competing products in the market and emphasize the unique aspects that make its product superior. When utilised successfully, sellers gain a competitive advantage by demonstrating why their products are unique.

Standing Out
A company can set itself apart from the competition in two ways: through cost leadership or through product differentiation. Cost leadership emphasises saving money and appeals to those who are on a budget. Product differentiation focuses on providing quality.

Product Differentiation Strategy
A good product differentiation strategy may gain brand loyalty, which is paramount to any successful business. This strategy focuses on a buyer’s perception of value. As long as the seller continues to provide high quality, the customer base will remain strong. Today’s financial climate contains businesses in an intensely competitive market. If a product does not have consistently high quality, consumers will turn to competitors. Creating a product that is unique will not be enough to gain the competitive advantage of product differentiation if the buyer does not value what the seller is differentiating on. When you build your business and have your differentiating feature, you have to make sure it’s something people want. Too many businesses have failed because they built something for their needs but forgot to check if other people were having the same problems.

How do you make sure you’re building something people want? Here are a few ideas:

– Ask people who could potentially be your customers/users.
– Set up a launch page explaining your UVP. Ask for an email address for an early invite. If you don’t get a lot of responses, don’t build it.
– See if there have been any previous attempts to build what you’re proposing.
– Learn about the problems people have with current offerings and determine if your solution is compatible

images2

Of course, differentiation is not without its pitfalls. Here are 7 things that you need to avoid.

1. Uniqueness that is not very valuable
Just because something is unique doesn’t mean that is has a higher value. Focusing on a characteristic that is either unwanted or not able to be perceived by the buyer will be a waste of time and money.

2. Diminishing returns of differentiation
You might start off with a clear strategy to offer the very best customer service in the industry. This is a good strategy to pursue, but at some point it will hit the law of diminishing returns. Once you become too differentiated, you leave yourself exposed to a competitor that can offer the right level of differentiation at a lower cost.

3. Too expensive
Differentiation allows you to charge higher prices because customers are willing to pay more for products that better suit their needs. However, if you charge too much for your differentiated product, your customers will quickly find an alternative.

4. Ignoring Signalling Criteria
Many companies refuse to invest in marketing or advertising because they believe their superior product is enough to attract significant buyers. However, if you are selling to inexperienced customers or buyers that don’t understand the difference in value of one product from another, you leave yourself exposed to a company that offers a product that is lower value but has a better understanding of signalling.

5. Not understanding costs
Differentiation often requires that you invest heavily in the areas that you are looking to set yourself apart. However, if you don’t fully understand how your direct costs, the price you are able to charge and the buyer’s perceived value are all interrelated – you will not be able to create sustainable differentiation.

6. Focusing too much on the product and not the bigger picture
A company that is focusing on creating a differentiated product will usually focus too much on their own physical product and not enough on the bigger picture of how that product fits into the world. There are many ways to differentiate a product, a lot of which aren’t directly tied to the product at all. It’s important that you fully understand how your product fits into the larger ecosystem.

7. Not understanding the customer
And finally, if you don’t fully understand who you are selling to, their problems and what they value in your product, you will end up creating a product that isn’t really differentiated at all. This leaves you exposed to competitors who actually do understand the market and can focus on meeting the specific requirements of the customer.

As Venus Williams once said:

“You have to do things right to stay in business, and that’s not easy, and that’s a choice on a daily basis, the choices you make in how to run your business and how to have a point of differentiation and how to be true to your brand, how to offer something that people want and to offer something that you love.”