No, I haven’t drunk too much oolong tea this morning. And yes, I am still asking you this. Sit down with me, have a cup of tea or coffee, whichever you like (I’ve just set out for a light green mango peach tea) and open your eyes widely. Let’s have look together at the e-commerce competitive landscape where you run your business and think this question through.

For the past year, I’ve started training marketers and online shop owners into the basics of e-commerce and digital marketing. My trainings invariably get at some point to the question “What makes you unique? What differentiates your business from the competition?“. The enthusiasm from my first trainings has started to fade when I realised that so many marketers and business people believe that their unique selling proposition is the fact that they offer cheaper transportation (not that this is not a great promotional hook, but it’s hardly an important ingredient in building a brand) or, even worse, the fact that they have better Google AdWords campaigns (not sure how it was measured also).

So, let’s set this straight… What e-commerce differentiation is NOT?

  • a logo;
  • a marketing campaign – marketing in a different way is a differentiator, but pay attention. One marketing campaign is not enough;
  • free or cheap transportation – easy to be copied, depends on how your audience feels about transportation and on many other factors in your industry vertical;
  • not just something your team knows – if your customer doesn’t know it, feel it, think it, then it is not there;
  • a marketing channel you use well;
  • an extra service you provide which you are not sure your customer needs;
  • a great product range your target audience has no idea you have;
  • a brandbook your team has forgotten about and its own writer was not convinced it will be of any use.

OK, OK, but then… What may be an e-commerce differentiator?

  • lower prices – though, I hardly believe the price competition was ever cheap or effective on the long haul;
  • convenience – but you have to see it through your target audience’s eyes;
  • product range – brand and product curation – especially appropriate for niche;
  • shopping experience – WOW-ing your customer in a way that provides him a shopping experience he wants to repeat;
  • superior quality – that your potential consumer actually is looking for;
  • great client service – NPS should show me this is true;
  • emotional communication – that speaks the language of your audience;
  • targeting only a niche of the target audience of your competitors and customizing your offer for this niche;
  • using different sales channels – and using them wisely;
  • extra services – that your potential client needs, wants, likes, appreciates and is growing loyal to.

Nothing new, right?! I know practice sounds great in theory, but when we get to the facts it may be that we are all too busy with business as usual that we simply forget to think outside the e-commerce box. In the day-by-day e-commerce box we have plenty going on, technology is constantly evolving, there is so much online marketing practices to keep track of and so much data that we have no idea what to do with. We focus on what e-commerce platform is the most effective. We think about our Google AdWords campaigns and their ROI and optimising this ROI (hopefully). We are in a constant frenzy of getting the most out of our social media presence. We worry about the delays in delivery, lost packages and shipping costs. We are simply left with no time to focus on the most important thing in our business: the customer.

Show me the customer!

So who is your target audience? I love it when I get the typical answer. For example, all shoes online shops sell to 25-35 year old women, with medium to high income, living in big cities. The questions that come to my mind immediately are:

  1. How come these ladies feel so stressed out when they are so desired by every single shoes online shop in the whole wide world?
  2. Don’t the rest of the ladies wear shoes?

Not all customers buy Jimmy Choo shoes

Jokes aside, this is almost never the right answer. Not that the right answer is not close or a part of this audience, but in order to have a business you should be more specific. You should know your customer like your best buddy, invite him over a cup of tea and find out all it is he or she wants from a shoes online shop. Of course, don’t take it literally as too much tea is never good for your health and you may get to waste a lot of time with strangers without shoes instead of actually selling some shoes.

Nevertheless, the first step in positioning your business is identifying the competitive landscape and the buyer persona you are actually selling to. Once you know who you are going to sell to, you should identify who your potential or existing customer considers to be your competition.

Competition is never in the eye of the beholder… it’s in the eye of the customer

Competition is only competition if your potential customers considers to buy from them instead of you or the other way around. Competition is what your customer perceives as competition. It may be that you are selling nails online and your customer considers Amazon as competitor or it may be that you are selling Nike T-Shirts online and your customer considers whether to buy from you or the mall that is 10 yards away from his home and has a Nike store.

OK, now what?

OK, so I got it. I know who I am selling to, I know who my competition is. How do I differentiate? Of course this is not an easy question and the answer cannot be given just like that. But it does all come down to the simple question “What would the Internet look like without your online shop?“. Because if there is no answer from this, you don’t actually have a happy customer, you don’t have a happy business. The answer is exactly this differentiator, this service you provide that wows your client.

Your e-commerce business differentiator should depend on 3 main factors:

  • customer’s needs – one easy way is to ask the client and find out the main factors that influence his/her decision. But we all know what Henry Ford said about people saying they wanted a better and faster horse. So sometimes, you need to have a mix of intuition, great knowledge about your customer and vision.
  • competitors’ strengths –  rather than getting in a battle for one of your competitors’ strengths, it may be more effective to find some blue ocean and compete for your client’s attention. If you get into a battle you should be sure you can win. If you can’t win at an affordable rate, then you should find a blue ocean strategy and another differentiator.
  • your business’s possibilities – you must be able to achieve this differentiator and it should be affordable (using it should have positive ROI)

So, to wrap it up, we have a plan, ladies and gentlemen:

  1. First have a look at the competitive landscape of businesses who are selling the same products or categories;
  2. Then identify the target audience you wish to serve;
  3. Check who your target audience perceives as competitor;
  4. Come up with the competitive advantage taking into account your audience’s need and your competitors’ strengths.

And this is unfortunately only the beginning. What comes next is implementing the differentiator, using it in all marketing activities, relating to your customer and so on. But at least you now know what the answer to the question “What will the Internet look like without your online shop?” will be.