I’m carrying on this series of posts on how vendors can differentiate themselves in the market when technical standards have had the effect of removing significant functional difference between competitive products.
This time I’m going to look at partnering to create differentiation in your offer. Whilst the product proposition will remain materially similar to that of the standards-driven competition, a proposition carved from the synergies of the product and a strategic partner can be beneficial.
Partnering – Other complimentary vendors
As I suggested in this post, broadening the product portfolio is one way to create differentiation. Whilst this can be done through internal product development, it is also possible to broaden the product proposition through strategic partnerships. Obviously there are some ground rules here. Firstly the products must be complimentary in that they should not overlap functionally. Secondly the resultant product set must take the vendor into new areas when compare to the competition. Thirdly, the partner must not have the same resultant product set themselves or conflicts can occur. Lastly, the resultant feature set must not be too much of a departure for your sales team to credibly take to market. If, to sell the partner’s products would require your own sales team to take on skills that they don’t naturally posses, this can be counter productive. All of these caveats notwithstanding, one shouldn’t underestimate the value of partnering for obfuscation. i.e. you partner to achieve a tick in the box and to create differentiation with no real intention of selling the partner’s products.
Partnering – Professional services
Similar in concept to the ideas I discussed on methodologies, differentiation can be created around how you implement your technology within your customer’s organisation. Third-party system integrators or boutique technical consultancies can add value and create differentiation in your offer. If you are going to rely on a third party organisation to create differentiation like this. it is essential that the reputation of the third party is second to none and that they provide something that you alone cannot. Perhaps access to a different audience strata or a reference customer base you don’t posses. In addition you should be wary of laying yourself open to the challenge that your proposition is so different or complex that you require specialist third-party services to implement it.
Partner – Embed your technology
Finally, the ultimate differentiation through a third party is to embed your technology within a third-party’s product. Not really differentiation as typically when this embedding is carried out your own proposition is actually hidden within that of the embedding vendor’s offering. That said, I have had first hand experience of using embedding deals like as references to create differentiation.
The claim that “We’re the solution that is embedded in ACME Corp’s product” can have a significant positive impact on credibility.
I’ll close out this discussion in the next post when I look at the use of standards bodies and technical education for differentiation.