Your competitive advantage
Secret sauce, golden nugget, secret weapon and game-changing element. Many names, same thing. Regardless of what we call it, it’s all about discovering the unique about your business. Sometimes, the unique part of a company’s product, e.g. the elegant, minimalist design of Apple products, the patented pharmaceuticals of Novo Nordisk, the coffee experience of Starbucks, or the unique cola-recipe of Coca Cola etc.
Even if your company’s products are not unique by themselves, you don’t have to worry. A company’s unique element(s) – and with that their special competitive advantage(s) – can be found in other parts of a company’s business model and not necessarily only in the product line. E.g. can a competitive advantage also be created in the contact with business partners, through special production methods, alternative sales methods or through a customer service that goes far beyond any expections.
Ten types of innovation
In the book ‘Ten Types of Innovation’, Larry Keeley describes how a company can differentiate themselves on different parameters, all in favor of strengthening the company in a competitive situation. These 10 types are:
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Innovation process (use of innovation)
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Core processes (processes in your company that are special)
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Product/service performance (design, features and functionality on core product/services)
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Service system (extra or combining products and services in addition to main products)
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Customer service (the way you help customers in different ways)
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Channel (delivery, marketing and sales of products/services)
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Brand (how your customers and more perceives your company)
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Customer experience (the whole experience of dealing with your company)
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Business model (revenue streams and costs)
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Value network (how value is created, also with co-working with other companies)
The more parameters that the company differentiates itself on, the bigger a competitive advantage they often have, and in return makes their success much more difficult to copy.
Use your secret weapon
When you know your competitive advantage, you can then use it both internally in your company and externally in your marketing towards potential clients and when communicating to business partners and investors. This means that you should use it in your pitch in a way that makes sense relative to the audience you’re pitching. If you need to, you can read more about how to properly defined your pitch audience here.
When you pitch a potential client and explain what it is that makes your product especially valuable (in itself and/or in relation to your competitors) you are basically presenting what is called a Unique Selling Point (USP). To return to Apple, a USP can be the iPad’s superior and intuitive design, that makes the use of the iPad a joyride. Here, the USP is when the customer experiences how the product is unique and differentiates itself from alternative products. When you explain others about your USP, remember to speak in terms of what advantages the customer will get from the product instead of just describing features. This ensures that you show an understanding of what is important to the customer.
Nevertheless, you competitive advantage can also be a “backoffice” element, which is not necessarily interesting to explain your customers. This is the case, if your competitive advantage does not lie in the product itself or in the service you offer, but e.g. lies in how your company earns money or how the company’s product methods are architectured. Contrarily, if you are pitching an investor, these kind of internal competitive advantages can be especially relevant to present.
If your competitive advantage is e.g. a patentable technology, it is important to explain this to an investor. If you don’t yet have a patent, consider not revealing the details of your ‘invention’, but sketch which opportunities your product creates and how it solves the needs of your customers.
By all means, pitch your competitive advantages, but consider how many details you should include.
If you don’t know your USP yet: ask the customers!
It sounds easy, but it can actually be quite difficult to narrow in on the right selling point that works against the person you are pitching. The easiest way to discover this is to ask your customers about their opinion. As an example, you could ask “What is the best thing about doing business with our company?” or “What are the greatest advantage you feel you get from using our product?”
You might feel a bit reluctant to do this, but after the first few times you should experience that the return of your ‘investment’ can be quite large. Become more precise regarding your Unique Selling Point is always a positive action to take, both when pitching new customers and when improving your overall pitch as a whole.
Where in my pitch should I tell about my secret sauce?
In most of our pitch templates on Pitcherific, it is a straightforward thing to write about your secret sauce. In some of the templates it is more explicit where you would write your competitive advantage, e.g. in our competitive pitch template (only PRO) it is the last thing your say, while in other templates such as the Elevator Pitch or NABC, it is a more implicit part of the ‘solution’ and ‘approach’ sections. In our investor pitch templates (only PRO), special competitive advantages can be mentioned wherever they fit the best, e.g. as part of ‘your unique insight’, ‘how you earn money’, or as part of the ‘business model’ section in our Danish Growth Fund template.
Good luck finding the secret sauce of your company. And if you’re already prepared to write about your competitive advantages then you will find our pitch templates at Pitcherific.com
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