Cracking the Differentiation Code: Standing Out in IT Services

ITSMA research has shown that “differentiating the company or its offerings” is a perennial challenge for services and solutions marketers. In the following discussion, ITSMA’s Julie Schwartz shares some insight into why this is such a tough area for services marketers and how they might do it differently.

ITSMA: What makes differentiation such a challenge for IT services companies?

Schwartz: Part of the problem is that we’re taking an intangible concept—differentiation—and applying it to an intangible offering—services. When you’re marketing a product, you can hold it, try it, touch it, taste it, and so on. You can’t do that with services. Yet many services marketers are taking the theory that’s been developed in the product world and trying to apply it to their offerings.

To make things even more difficult, when services companies think about how they want to position themselves, they all want to occupy the same space in the customers’ minds—for example, the responsive industry expert that understands your business and is committed to customer success. When that’s what every company is going after, it’s no wonder they all sound the same.

ITSMA: What can services firms do to make themselves stand out?

Schwartz: First of all, they need to make sure that their positioning is customer-driven rather than driven from within the company. Too many companies decide to position themselves a certain way because the management team thinks it’s a good idea. It might very well be a differentiator, but are your customers going to care? Is it something that’s driving purchase decisions? In other words, it might set you apart from competitors, but in a way that is irrelevant to customers. Or is it something that all of your competitors are claiming, so, by golly, you’ve got to talk about it, too? In this case, the positioning may be important to customers, but it isn’t really a differentiator.

By investing some time and money up front in customer research, you’re more likely to hit upon a message that not only resonates with your target audience but one that’s actually different from what your competitors are touting.

ITSMA: Besides getting at the heart of customer preferences and priorities, what else should services companies be doing to better position themselves?

Schwartz: There are a few other essentials. One is making sure that who you are and what you do is communicated clearly. I’m amazed at how many times I visit a company Website, click around for five minutes, and still can’t figure out what the company actually does! Is it a software company? Do they sell services? Who are they trying to reach? I have no idea! Tell me in simple, straightforward language who you are and the benefits I’ll get from buying your offerings.

Another important consideration is building up a good reference program and using communities such as industry associations and the blogosphere to amplify positive word of mouth. Think about it: When you’re looking around for a new doctor, do you go to the guy with the coolest billboard? No, you go to the doctor your sister recommended, or to the one your coworker told you about the other day at lunch. Same thing goes for IT services.

Finally, I’d suggest that you keep your finger on the pulse of your customers by assessing how their perception of you is changing over time and as a result of your marketing initiatives. You might need to tweak your messaging periodically or even significantly change your positioning based on changes in the customer and competitive landscapes.

ITSMA: Is there anyone out there you can point to as a best-practice example?

Schwartz: Capgemini has done a nice job with its Collaborative Business Experience initiative. The company did a lot of research to identify and flesh out its core value proposition and then conducted an internal education campaign to ensure that all executives and employees could live up to the new brand promise of collaboration. Only after several months of internal education did the marketing department unleash its public-facing campaigns.

In services, differentiation is something that exists in the minds of your clients. And it’s best communicated through the actual customer experience. You can’t just declare something and expect them to believe you. The customer experience has to match the promises and value propositions of the brand, which is why the internal education piece is so important.

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ITSMA specializes in helping companies market and sell services and solutions more effectively. We work with the world's leading technology, communications, and professional services providers to generate increased demand, strengthen customer relationships, and improve brand differentiation. ITSMA annual program clients include business leaders such as AT&T, Cisco, Deloitte, EMC, Fujitsu, Hewlett-Packard, IBM, Microsoft, SAP, and Tata Consultancy Services, among others. Our comprehensive research, consulting, and training on topics including ITSMA Account-Based Marketing℠, Brand Positioning, and Solutions Development provide the insight and experience companies need to improve business results. ITSMA is based near Boston, and has offices in London and Tokyo. Learn more at www.itsma.com.