Ideal Competitive Strategy: The Logical Choice for a Niche

‘Grab whatever you can get hold of’ is often the approach of choice for sales and new business in times of crisis. And who can blame them, because the order book needs to stay filled. This does mean, though, that a lot of industrial (manufacturing) companies are still doing too much for too many clients. There's no focus. And without that focus, achieving growth ambitions is pretty much impossible.

The risks at a glance

Lack of focus affects several areas. The impact is felt by all departments in your industrial (manufacturing) company. Engineers struggle with the development of products. Marketers aren't sure what they need to communicate. Sales works hard without really getting anywhere.

This unclear situation creates an imbalance and stress in the workplace.

Lack of focus stagnates long-term growth in innovation, development, sales, and profits. Ultimately, all of this is detrimental to the company's net worth. This puts the future of these manufacturing companies at risk.

Direction, peace and regularity

Choosing to focus does have its advantages. It brings direction, peace and regularity, and ensures the company is seen as a real specialist.

More on this later.

Focus enables the organization to conceive and develop new and better solutions. It means becoming even better at what you're already good at.

“TEUN challenges you to make choices and
to add focus”

Joost van Aaken, ARODO

ARODO, based in Arendonk (BE), opted to focus on packaging solutions for high-quality powders based on the advice of TEUN. This allowed the company to create its own niche.

At TEUN, we want every industrial (manufacturing) company to have such a niche. Why? Because choosing a niche is the best gift a company can give itself. It's what we firmly believe and what our clients experience every day.

Competitive strategy

We speak of a niche when a company targets a customer group, market or market segment or even application (in the case of Arodo). This can be part of the focus strategy according to Porter's generic strategies.

If your company offers unique and valuable products or services, you are actually using the differentiation strategy.

If you combine these strategies, then, according to Porter, you're using the differentiation focus strategy. In our opinion, this strategy is an "ideal" competitive strategy for many industrial (manufacturing) companies.

But what makes this strategy so ideal?
 

The benefits at a glance

• High efficiency: focus lets you utilize manpower and resources more effectively
• Competitive advantage: the ability to stand out from and stay ahead of your competitors
• Larger margins: customers are willing to pay more for a unique product offer.

Despite these benefits, we see that the message to narrow down the focus is met with some resistance.

To clear the air, going from broad to narrow doesn't automatically mean ‘saying no’ to your existing or less ideal customers. It means making a ‘switch’ over time.

Those who choose, are chosen

If you consciously choose the focus strategy, such as the differentiation focus strategy, it not only provides clarity and structure, but more importantly, it provides attractiveness. That's because, those who choose are chosen themselves.

Especially when you link your company brand (who you are and what you stand for) to a specific proposition (what you do and for whom). By then conveying your message effectively, people will start seeing you as a specialist.

Because those who choose, are chosen.

Moreover, as a specialist, you have a better negotiating position. Given the growing need for specialists, this is absolutely a win-win situation.

Now is the time: there is a growing need for specialists in the industry.

The right efforts

The bad news is that all this automatically simply leads to attracting new customers. There's more to it than that.

For instance, applying industrial marketing increases your exposure and gets you to that preferred position, and that makes it impossible for potential customers to ignore you.

This does call for some changes in sales, given the fact that the B2B buying process in the manufacturing industry has changed so dramatically. That transformation also relates to improved cooperation and marketing.

Conclusion

Many industrial (manufacturing) companies are or will soon be struggling because they lack focus. Growth steadily stagnates in the areas of innovation, development, sales and profits. All this eventually has repercussions for the value in use.

But more and more manufacturing companies are managing to break the deadlock.

After all, they employ the differentiation focus strategy, ideal for manufacturing companies. This provides direction, peace and regularity. And every department benefits from this.

By connecting your brand to a specific proposition, you will be seen as a specialist. Combine this with the use of industrial marketing and you have gold in your hands.

Wondering what industrial marketing can do and how to choose the right approach? Make an appointment. We will show you how it works and what results it leads to.