Differentiation is so much more than a USP

Differentiating your idea from the competition is Startup 101, but I get a feeling that everyone is so dramatic about it.

It seems everybody is looking for the big showstopper.

The thing is, you don’t need a grand unique selling proposition for your product or service. The key is to be unique in some way, and it’s not always as obvious and straightforward.

Competition can come from many places but so can your competitive advantage.

Try to look at differentiation from another aspect – most notably how you can niche down.

The power of niching down

The idea is to captivate a segment of the market, even if the overarching goal is to branch out to the entire market.

I’m a big fan of niching down because in competitive areas, particularly the tech industry, differentiating through more features or an upgraded solution to that of a competitor isn’t necessarily going to meaningfully make your startup stand out from the rest of the pack.

The harsh reality of running a business is that there will always be someone trying to capitalize on the exact opportunity you are. So, adapting your solution to serve an underserved group within a specific market segment can be your angle to building a unique startup and commanding customers’ attention and money, perhaps even loyalty.

Here’s the real beauty of scouring for a niche: your uniqueness can be anything, literally.

For example – sleeker design, faster computing time, dedicated customer support, third-party openness, specifically aimed at the people of Spain… I could go on and on. There are all these layers of usability, functionality, user satisfaction, and whatnot at your disposal to find something that no one else has.

It’s hard for me to grasp why so many founders force themselves into a corner when it comes to differentiation. Yes, it’s a big decision but it doesn’t have to be big in scope. I find that the more niched it is, the more probable it gets.

That’s another important thing. Any investor will tell you that the commitment to something small and possible is actually a key differentiator because it’s there. It doesn’t matter what it is, what matters is that you have it.

Stay on top of mind with a distinct look and sound

One underreported layer of differentiation is the sensory level. Our senses play a key role in how we perceive the world, having a strong influence over buying decisions.

Every startup is just one of numerous others vying for a limited piece of the action. So, every bit of resources you can leverage matters, including stimulating the senses and generating emotional attributes you can own.

The key to achieving distinctiveness is being consistent with your brand assets. These, ultimately, help customers identify with you in any given environment – from elements like logo, color palette, and words, to multimedia formats.

This includes thought leadership too, as it’s an effective way to promote and portray your company’s positioning through the communication of images and messages. For tech companies, in particular, it’s a remarkably powerful opportunity to set yourself apart by building a charismatic persona (usually a top C-suite exec) through original content and strong opinions.

In essence, you’re boosting the value of all your marketing tactics, for which you’ll need a determined marketing team that executes on a regular basis.

Peeps from Gong do this really well. The team, led by CEO Amit Bendov and CMO Udi Ledergor, understands the power of brand consistency and using emotion in their graphics, leveraging the company’s purple colors/gradient on their LinkedIn and blog. From cover and profile pictures to featured blog images, it’s unmistakably Gong.

They also fully embrace the idea of creating content (I’m following them on LinkedIn so that’s where I best see it) that elevates the brand, ranging from data-driven insights and techniques the company uses to create more sales to expert opinions.

Don’t fall into the blue ocean trap

As a final piece of advice I can offer, put serious thought into how you want to “attack” your segment. There’s a lot of buzz for blue oceans and inventing a category or subcategory where you are the master of the domain.

It’s a nice dream to have, which, if you have time (at least 5-6 years) and deep pockets with several investors willing to be in it for the long run, can become true.

But until and if that happens, you have to live in the current reality. It’s the one where the market share of an emerging category is extremely difficult to obtain for smaller businesses because executing new ideas is heavily pricier than doing them after someone else. It’s far easier to be a better alternative than a sole player because it’s a lot easier to be an entrepreneur than it is to be an innovator.

At the end of the day, you don’t need to be overly innovative or creative – just competitive and tenacious enough to do something just a little bit better. Your competitive advantage is your skill set and traits, i.e. your main source of differentiation. That’s what defines and differentiates you as an entrepreneur.

About the Author
Ronen Menipaz is an Israeli investor, entrepreneur, tech advisor, and founder of numerous business ventures in the entertainment, adtech, and fintech space, as well as the co-host of the Real Life Superpowers podcast. During his 25 years of entrepreneurial experience, Ronen has been involved with over 100 startups in Israel, 30 of which he founded or co-founded. Two of those startups went public, while five were sold and four more are currently privately profitable companies.
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