Product and Service Differentiation | Executive Sales Tips

The Myth of Product Differentiation

I regularly emphasize the fact that it is absolutely critical for us to gather information about the prospect early in the sales process and why our true source of product or service differentiation has to be their environment rather than our solution or product, and I was reminded of this again during another coaching session with one of my clients today. I was working with one of the salespeople who had just come out of a meeting, which he said had gone great. However, when I read the notes about this meeting, they said, “The client now has a clear understanding of our services, our capabilities and pricing, and he would like to see a proposal.”

This was their first discovery meeting, and I reminded him of the conversation we had about meeting with a client. He was obviously a little put off when I suggested that he wasn’t doing it right by starting off talking about his products and services. I told him he really needed to push that conversation to later on because what he does, how he does it, and how his services are performed are not effective means of differentiating himself from the competition. His defensive reply was, “What do you mean? We’re better than our competitors, and we can prove it. We talk about it and we show them examples.” I told him that I get it, but asked if he could tell the difference between a $10,000 set of speakers and a $1,000 set of speakers. He looked at me and asked, “What? What do you mean?” So I asked him if he had a stereo at home. He replied, “Yeah, I have a nice stereo with surround sound, and I have a couple things that can play my iPod.” Then I asked if he could tell the difference between his $1,000 stereo with surround sound and a $30,000 system. He said, “Well, maybe a little bit.” So I continued to ask if he could tell what the $20,000 difference was, to which he admitted, “Well, no. I mean, to me they all sound pretty good.

Exactly, I pointed out, because he is not an audiophile.

The moral of the story here is actually very simple. We tend to be very skilled at articulating our product and service offerings, how we do what we do, why it’s better, and how we are better or different than the competition. Unfortunately, because our prospects are not experts and are at the most basic level of understanding of the services they are procuring from us, they tend to have lower levels of sophistication relative to the topic area we are talking about. So when viewed from the prospect’s side of the table the question ultimately is, do three vendors look different at all? Is it even possible for a prospect to distinguish between multiple vendors based on the articulated quality of service offering and the means of differentiation that we think is going to separate us from our competition?

The source of product and service differentiation has to be in terms that the prospect understands. More importantly, it has to be related in directly articulated terms of how it’s going to impact their business, their revenue, their expenses, and their employees because the prospect will never have the level of understanding that our industry has of our own product or service offering necessary to appreciate the nuances between an acceptable vendor and an exceptional vendor. They are simply not experts in our business. To state even more simply, our clients are not audiophiles, and they try to distinguish between a very expensive set of speakers and a very normal set of speakers, it will be very hard for their untrained ears to tell apart.

By Townsend Wardlaw

photo credit: superUbO via photopin cc


  1. Even if you are selling stereo systems to audiophiles, you still need to listen to the customer’s needs to differentiate your $30,000 system from the next one.

  2. Great post. All too often we get caught up in the cool new features or product offerings and forget that our prospects are for the most part still learning the basics.

  3. Great post, Towmsend (I’m seeing a pattern here!). Love the audiophile analogy…permission to use with proper credit? My sense is you have turned an important corner with your client! KSR

  4. Couldn’t agree more, Townsend! Especially when you’re providing a technical solution, I would think this approach takes a lot of weight off the salesperson because they don’t have to be a technical expert – they just have to be a communication expert. For me at least, that’s a much better role!

  5. This is a brilliant post, Townsend. You hit on so many important topics. I love your perspective that we must learn to perceive our message through the prospect’s eyes. It’s not about us and our solution, is it 🙂

    Thanks for the great content.

  6. I completely agree with this and try my best to differentiate myself whenever possible. For instance, on Halloween everyone we called our very first question was are you dressed up for Halloween? If the answer was no it was a “shame on you.” If they were then the conversation moved in that direction. I was talking to people for a couple of minutes before they even knew who I was or why was I calling.

  7. Great post! This is something that I have always struggled with. Probably has to do with my insecurities, but I always tend to assume that people know more than I do or already know what I’m trying to communicate. I have to train myself to make sure I’m speaking in terms that people understand. Talking over peoples’ heads comes across as BS.

  8. I used to always ask the question “how does company {fill in the blank} do so well. Their {software} is really horrible but they sell a lot of it.” The root of this post provides the answer. Consumers generally don’t buy the best or right solution. Not because they don’t want to but because they are not educated enough to know the difference. Thus, if our competition is better at listening and telling prospects what they want to hear and positioning themselves in a way that resonates with the prospect it doesn’t matter how good or bad their product is. Townsend you’ve done a great job of stirring me away from focusing on our products features and functions and focus on solving problems. At the end of the day, clients do not care about features and functions, they care about solving business problems. I wish I would have learned this much sooner.

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