Attack of the Clones! 7 Ways to Differentiate Your Software

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What makes your software special?clones 7 ways differentiate software

If you can’t answer that question, then it’s likely that your prospects can’t either. And according to big names like Seth Godin, that’s a big problem. Even if you’re having trouble coming up with an answer, take heart — here are seven ways you can make your product stand out from the crowd:

1. Address Highly Specific Needs
The business software market has become increasingly segmented with the introduction of highly specific products. If your product is specialized, it will stand out from a bunch of generic, one-size-fits-all solutions.

For example, pretend that you’re a black belt karate maven who wants to find software to manage your new studio. You stumble upon Capterra’s Club Management Directory and start scrolling down. What product jumps out first? If you’re like me, it’s ChampionsWay Martial Arts Management Solutions. Does this mean that the products listed above it aren’t right for you? Not necessarily, but ChampionsWay has differentiated itself by offering exactly what you want, so it catches your highly-trained, karate-maven eye (and your click).

2. Build Your Own Solution
Lunch options like Chipotle and Subway are appealing because they display all of their offerings and let you pick what you really want. You can use the same strategy to appeal to software buyers by serving up product features a la carte and letting them pick and choose what to purchase. There are two main ways to do this:

  • Offer your product with various tiers of functionality and corresponding pricing. A tiered model allows prospects with different sized operations and varied requirements to get what they need without paying for what they don’t. This strategy will set you apart from solutions that force users to either pay for unwanted features or pay costly add-on fees to very basic offerings. As an added bonus, if a customer’s needs change and those once unnecessary features become appealing, it’s easy for them to upgrade to the next tier.
  • The second big way to let customers “build their own” is to make your product easily configurable. This lets every customer create a tool that performs the functions they want and collects the data they need.

3. One and Only
If your solution is literally the only one that addresses a certain problem or need, it’s sure to stand out as the best choice. Heck, it’s the only choice! There are a few ways to do this. You can:

  • Offer a unique feature
  • Let users easily transition from legacy software programs that other solutions in your market ignore
  • Make your product easily integrate with other programs that your customers rely on

Market research will help you identify other needs that can be pinpointed and leveraged as opportunities for differentiation.

4. A Combo Meal

There’s something about the simplicity of an end-to-end solution that makes it jump out to buyers. It’s just like the appeal of a combo meal (or a prix fixe menu if you’re fancy) – you know that all your bases have been covered and components will compliment one another.

Depending on what type of software you sell, the application of a “combo meal” strategy will vary. If, for example, you sell bakery software called RecipePro, and it only keeps track of recipes, anyone looking for a comprehensive bakery solution will see you as just another partial-solution. On the other hand, if your product covers everything from organizing recipes to pricing baked goods, from buying ingredients to tracking delivery, and from performing nutritional analysis to formatting labels, RecipePro will stand out as the go-to solution.

5. Incredible Service
If customer service is a big consideration for a prospective buyer and your company is known to be the “Ritz Carlton” of the software world, you’ll jump out and maybe even move to the top of their list. By showcasing how you deal with bugs or down-time, clearly articulating your implementation training methods, or helping transition customers onto your system can help your product stand out as a less risky choice. Prospects will feel reassured knowing that your company will help make their investment a good one, and that’s a powerful motivator for any buyer. 

6. Price

Offering a price that can’t be beat is sure to help you stand out among more expensive options, so consider offering a low price or even a freemium model to help penetrate the market. You can then offer your full product as an up-sell once your users are hooked. Of course, a classic rule of marketing is that you shouldn’t compete on price AND try to differentiate your functionality for a specific niche, because if you’ve differentiated yourself enough to command a higher price from a particular market, then cutting your prices only hurts your bottom line. In other words, if price is your differentiator, then that’s what you should use as your selling point. Think of this as the Wal-Mart method of software marketing. If you don’t want to go all-in on price wars but still want to appeal to a lower-budget clientele, you could also consider changing your pricing model from a one-time licensing fee to a monthly or quarterly billing schedule to help eliminate sticker shock when clients see your quote.

7. Marketing

This one is interesting (and kind of cheating) because it doesn’t have to do with changing your product… it has to do with changing the way you represent your product. You probably are testing and trying new marketing campaigns all the time to see what sticks, so consider how an unusual campaign or promotion could catch your target market’s attention and set you apart from your competitors. This probably won’t serve you well if your product isn’t already a fabulous and useful product (are you familiar with the term, “putting lipstick on a pig”?), but it is a quick-fix way to get a product that is otherwise very general or generic to jump out and can even help you establish your key differentiators.  Many software companies are evaluated by their culture and overall marketing approach even more than their actual product (which is an unfortunate reality in our industry).
Whatever you decide sets you apart from the pack, remember to educate current and potential customers about it (and then, you know, deliver on it) to ensure a successful differentiation strategy. If it’s done right, differentiation will aid you with both conversion and retention.

Still not sure where to start? Ask your customers what they value most about your product, and share what they say in the comments below!

Looking for software? Check out Capterra's list of the best software solutions.

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About the Author

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Alison Klein

Alison Klein is a Marketing Assistant at Capterra. She helps with all marketing-related tasks and reports on customer relationship management. When she’s not covering the software industry, you can find her writing, enjoying good food, and listening to Jay-Z.

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