Unique Attributes: Finding Your True Differentiation

“The art of marketing is the art of brand building. If you’re not a brand, you’re a commodity. Then price is everything and the low-cost producer is the only winner.” — Philip Kotler

The Differentiation Delusion

In a nondescript conference room, the leadership team of a mid-sized professional services firm gathered around printouts of their competitors’ websites. They had been tasked with identifying their firm’s unique selling points—what truly separated them from alternatives in their crowded market.

After hours of discussion, they proudly presented their conclusion: “We’re innovative, client-focused, results-oriented, and we deliver exceptional quality through our experienced team.”

The marketing director sighed and pulled out a folder. “I suspected we might land here, so I prepared something.” She distributed printouts of their top five competitors’ websites, with certain phrases highlighted:

• Competitor A: “Innovative solutions with a client-first approach, delivering measurable results through our experienced professionals.”
• Competitor B: “Results-driven experts providing innovative services with a focus on client success.”
• Competitor C: “Our experienced team delivers innovative approaches that are client-centred and results-focused.”

The room fell silent. Their supposedly distinctive position was practically identical to everyone else in their market. What they claimed as unique was, in fact, utterly common.

This scene plays out daily across organisations of all sizes and sectors. Businesses consistently struggle to identify genuine differentiation, falling back on generic claims that their customers can’t distinguish from alternatives. The consequences are severe: commoditisation, price pressure, and the perpetual struggle to explain why customers should choose them over seemingly identical competitors.

In previous chapters, we’ve explored how to discover your essence, translate it into market relevance through a unifying idea, select your positioning approach, and understand your competitive alternatives. Now we confront perhaps the most challenging question in the positioning journey: What genuinely makes you different from alternatives?

The answer is rarely what you think.

True vs. False Differentiation

Before diving into how to identify genuine differentiation, we must first distinguish between true and false differentiation—the difference between distinctive attributes that create real separation and those that merely create the illusion of uniqueness.

The Four Tests of True Differentiation

Genuine differentiation passes four critical tests that separate it from merely claimed uniqueness:

1. Genuinely Different: Objectively Distinct from Alternatives

True differentiation must be objectively different from what alternatives offer, not just portrayed differently in marketing. This distinction can appear in your offering, approach, business model, or culture—but it must be real, not merely claimed.

Consider Brewdog, the Scottish craft brewery. When they claimed to be a “beer for punks” challenging industrial brewing norms, this wasn’t just marketing language. It manifested in objectively different behaviours: provocative flavour profiles that defied category norms, controversial marketing that corporate brewers wouldn’t risk, and their industry-changing “Equity for Punks” crowdfunding model that bypassed traditional financing.

As co-founder James Watt explains: “We didn’t just say we were different; we actually did things incumbents wouldn’t or couldn’t do. That’s the only differentiation that matters.”

2. Meaningfully Different: Creating Value Customers Actually Care About

True differentiation creates value that target customers genuinely value, not just distinctions that matter internally. The question isn’t whether you’re different, but whether that difference matters to the people you serve.

When Monzo entered the UK banking market, they didn’t just create technical differences from traditional banks—they focused on differences customers genuinely cared about. Their real-time transaction notifications, spending categorisation, and seamless international usage addressed genuine pain points that traditional banks had ignored despite having the technical capability to solve them.

Tom Blomfield, Monzo’s founder, notes: “A differentiated feature is worthless if it doesn’t solve a real customer problem. The question isn’t ‘Is this different?’ but ‘Does this difference actually matter to customers?‘“

3. Demonstrably Different: Capable of Being Proven, Not Just Claimed

True differentiation can be verified through evidence, not just asserted in marketing. It must be provable before purchase, not just promised.

When Stripe positioned itself as a developer-friendly payment platform, they didn’t just claim simplicity—they demonstrated it through their famous “7 lines of code” integration example, a clear proof of difference that developers could verify before committing. This demonstrable differentiation created credibility that marketing claims alone never could.

As Patrick Collison, Stripe’s co-founder put it: “In our industry, claims are worthless—everyone makes them. Show, don’t tell.”

4. Sustainably Different: Not Easily Copied or Neutralised

True differentiation has defensibility—it can’t be easily copied or neutralised by alternatives. It must have some protection mechanism, whether through expertise, scale, network effects, culture, or other barriers.

The most sustainable differentiation typically emerges from essence—your fundamental identity and approach—rather than from features or offerings alone.

When IDEO established its human-centred design approach, their differentiation wasn’t just methodological but cultural and philosophical. Their cross-disciplinary teamwork, creative environments, and design thinking approaches emerged from deeply held values about how design should work. While competitors could copy individual techniques, they couldn’t easily replicate IDEO’s essence-driven culture that sustained this differentiation.

As IDEO founder David Kelley observed: “The things that truly differentiate us aren’t the methods themselves—many of those have been published. It’s how these methods are integrated into our culture and approach.”

The Common Myth: Features as Differentiation

Perhaps the most dangerous differentiation misconception is that features or capabilities alone create meaningful separation. In reality, features are often the weakest form of differentiation for several reasons:

1. Features are easily copied. In most industries, competitors can replicate features relatively quickly, making such differentiation temporary at best.

2. Features often lack emotional connection. Truly compelling differentiation typically has both functional and emotional dimensions, while features address only the functional.

3. Features often don’t address underlying needs. They solve surface problems rather than fundamental needs, creating shallow rather than deep differentiation.

4. Features often create complexity rather than clarity. Adding features frequently makes products harder to use and positions harder to understand.

This doesn’t mean features never contribute to differentiation—they can, but usually only when they express deeper, essence-aligned difference rather than standing alone as tactical additions.

The Three Sources of Authentic Differentiation

Where does genuine differentiation come from? Our research across hundreds of companies that have established distinctive positions shows that authentic differentiation emerges from three primary sources:

1. Philosophy-Driven Differentiation: Distinctive Beliefs and Values

The most powerful source of differentiation often comes from fundamental beliefs and values—the philosophical foundations that drive decisions throughout an organisation. This philosophy-driven differentiation shapes everything from product development to customer experience to operational priorities.

Key Characteristics:

• Emerges directly from organisational essence
• Creates consistency across diverse decision points
• Shapes priorities and trade-offs throughout the business
• Often reflects founder perspectives and origins
• Creates emotional connection beyond functional benefits

Example: Patagonia’s Environmental Philosophy

Patagonia’s environmental philosophy drives differentiation throughout their business. From materials selection (recycled and organic inputs) to repair programmes (fixing rather than replacing products) to their “Buy Less” campaigns (actively encouraging reduced consumption), their environmental values create clear separation from traditional outdoor brands.

This philosophy-driven differentiation isn’t a marketing stance but operational reality, with implications for every aspect of their business. As founder Yvon Chouinard explained: “Every time we’ve made a decision that’s right for the planet, it’s made us more money in the long run.”

Example: ThoughtWorks’ Social Justice Philosophy

In professional services, ThoughtWorks has differentiated itself through a philosophy combining technical excellence with social justice values. In an industry typically focused exclusively on commercial outcomes, their explicit commitment to “create a more socially and economically just world through software” creates distinctive separation.

This philosophical differentiation manifested throughout their operations—from client selection (declining work with certain industries despite revenue opportunity) to recruitment practices (prioritising diversity beyond industry norms) to advocacy positions (taking public stands on social issues).

What makes this differentiation powerful is that it flows from genuine essence rather than marketing calculation. As former Chief Scientist Martin Fowler explained: “This position wasn’t developed as a differentiation strategy—it’s who we’ve always been. But it does create natural separation from alternatives.”

2. Capability-Driven Differentiation: Unique Skills and Processes

The second major source of differentiation emerges from distinctive capabilities—the unique skills, methodologies, or processes that enable different results or experiences. This capability-driven differentiation expresses itself through how you work rather than just what you create.

Key Characteristics:

• Frequently emerges from repeated practice and continuous refinement
• Often combines multiple skills in unique combinations
• Creates results that alternatives struggle to replicate
• Usually requires significant time to develop and maintain
• Often includes both formal methods and tacit knowledge

Example: IDEO’s Design Capability

IDEO’s design capability creates distinctive differentiation in the consulting landscape. Their human-centred design approach combines anthropological research methods, rapid prototyping skills, and cross-disciplinary collaboration processes to create results that conventional consultancies struggle to match.

This capability-driven differentiation emerged from decades of practice rather than strategic planning. As co-founder Tim Brown explained: “Our approach developed organically through repeated application, not through a deliberate differentiation exercise.”

Example: What If Innovation’s Inventive Thinking

In professional services, innovation consultancy What If has established differentiation through their “Inventive Thinking” methodology, combining creative techniques with business rigour to generate breakthrough solutions.

Their capability differentiation manifests through distinctive workshop formats, visual thinking approaches, and ideation methodologies that create experiences substantially different from traditional management consultancies. This differentiation isn’t just claimed but experienced directly by clients through their engagement approach.

3. Resource-Driven Differentiation: Exclusive Assets or Advantages

The third source of differentiation comes from exclusive resources—unique assets, relationships, or positions that alternatives can’t easily access. This resource-driven differentiation creates separation through what you have rather than what you believe or how you work.

Key Characteristics:

• Often emerges from historical investments or circumstances
• May include physical assets, data, intellectual property, or relationships
• Creates barriers to entry that protect differentiation
• Frequently requires significant scale or time to establish
• May be combined with capabilities to create compound differentiation

Example: McKinsey’s Knowledge Leadership

McKinsey’s differentiation in management consulting has been substantially resource-driven, built on knowledge assets accumulated over decades. Their proprietary research, systematic knowledge management, and vast alumni network create resources that new entrants cannot easily replicate regardless of their capabilities.

This resource-driven differentiation began with the launch of the McKinsey Quarterly in 1964, establishing themselves as knowledge leaders rather than just service providers. As the firm grew, this differentiation strengthened through cumulative investment in research, frameworks, and knowledge infrastructure.

Example: ustwo’s Monument Valley

Digital product studio ustwo created distinctive resource-driven differentiation by developing their own successful mobile game, Monument Valley. This award-winning product serves as both portfolio evidence and capability demonstration, showing rather than telling potential clients what the studio can create.

This resource differentiation provides credibility that pure service portfolios struggled to match. As co-founder Matt Miller explained: “Having our own successful product changes conversations with clients. It’s tangible proof of our capabilities that creates immediate differentiation.”

The Differentiation Diagnostic: Uncovering Your True Attributes

How do you systematically identify your genuine differentiation? The Differentiation Diagnostic provides a comprehensive methodology for uncovering, validating, and leveraging your truly distinctive attributes:

1. Attribute Identification: Finding Potential Differentiation

The first phase involves systematically identifying all potential differentiation points across four key dimensions:

Product/Service Attributes

• What features or capabilities might create separation?
• How does your offering structurally differ from alternatives?
• What unique combinations or integrations do you provide?
• What unusual priorities or design choices have you made?

Process/Methodology Attributes

• How does your approach differ from conventional methods?
• What unique processes have you developed?
• What distinctive techniques do you employ?
• How does your workflow create different experiences?

People/Culture Attributes

• What values visibly influence your decisions?
• How does your team composition differ from alternatives?
• What unique perspectives drive your approach?
• How does your culture create distinctive outcomes?

Business Model Attributes

• How does your economic structure differ from norms?
• What unusual resource allocations have you made?
• How do your pricing or revenue approaches differ?
• What strategic trade-offs have you chosen that others haven’t?

For each dimension, the goal is to identify all potential differentiators without immediately judging their strength or validity. This broad exploration prevents premature dismissal of attributes that might prove meaningful upon deeper examination.

2. Uniqueness Assessment: Determining Actual Distinctiveness

With a comprehensive list of potential differentiators, the next phase involves rigorously assessing how genuinely distinctive each attribute actually is:

Objective Comparison Analysis

• How many alternatives possess this same attribute?
• How substantively different is your expression of this attribute?
• Is this difference noticeable without direct comparison?
• Can customers detect this difference before purchase?

Historical Distinctiveness

• How long have you maintained this difference?
• Has this attribute been consistent or intermittent?
• How has this attribute evolved over time?
• Is this a growing or diminishing point of separation?

Explicit vs. Implicit Distinction

• Is this difference explicitly claimed or just operationally present?
• Do customers recognise this difference or do you need to highlight it?
• How prominently do you feature this attribute in communications?
• Do competitors acknowledge this difference or ignore it?

This assessment requires ruthless honesty about what is truly distinctive versus what is merely claimed as unique. The strongest differentiation typically emerged as “surprisingly distinctive”—attributes originally considered normal that prove remarkably uncommon upon rigorous comparison.

3. Value Confirmation: Validating Customer Importance

Genuine distinctiveness alone doesn’t create meaningful differentiation—the difference must matter to target customers. The third phase assesses the value relevance of each truly distinctive attribute:

Customer Problem Alignment

• What specific customer problems does this difference address?
• How directly does it solve these problems compared to alternatives?
• What evidence shows customers care about these problems?
• How frequently do customers encounter these problems?

Decision Impact Assessment

• How does this attribute influence selection decisions?
• What evidence shows customers value this difference?
• How does this attribute compare to other selection factors?
• Would customers pay a premium for this difference?

Segment Variation Analysis

• How does attribute importance vary across customer segments?
• Which segments value this difference most significantly?
• Are these segments attractive business opportunities?
• How might segment preferences evolve over time?

This value confirmation separates truly meaningful differentiation from interesting but commercially irrelevant distinctions. The most powerful attributes emerged as both genuinely distinctive and highly valued by target customers.

4. Sustainability Analysis: Evaluating Competitive Defense

The fourth phase assesses how defensible each differentiation attribute is against competitive response:

Imitability Assessment

• How difficult would this attribute be for competitors to copy?
• What barriers protect this differentiation from imitation?
• What investments would replication require?
• How quickly could competitors neutralise this difference?

Resource Requirement Analysis

• What ongoing investments maintain this differentiation?
• What capabilities support this attribute’s continuation?
• How dependent is this attribute on specific individuals?
• What systems ensure consistent expression of this difference?

Evolution Potential

• How might this differentiation strengthen over time?
• What future investments could enhance this attribute?
• How might market changes affect this differentiation?
• What emerging trends support or threaten this difference?

This sustainability analysis identifies which differentiation points offer long-term advantage versus temporary separation. The most valuable attributes combine current distinctiveness with long-term defensibility.

5. Leveragability Evaluation: Assessing Amplification Potential

The final phase evaluates how effectively each differentiation attribute can be amplified and communicated:

Visibility Assessment

• How easily can customers perceive this difference?
• What evidence demonstrates this attribute convincingly?
• How memorable is this differentiation point?
• What proof formats best communicate this difference?

Storytelling Potential

• How effectively can this attribute be narratively expressed?
• What stories illustrate this differentiation in action?
• How emotionally resonant is this difference?
• What metaphors help explain this attribute?

Extension Capacity

• How broadly can this attribute be applied across offerings?
• What new opportunities might this differentiation create?
• How might this attribute evolve without losing distinctiveness?
• What adjacent spaces might this differentiation address?

This leveragability evaluation identifies which attributes can most effectively drive market positioning. The most powerful differentiation combines genuine distinctiveness, customer value, competitive sustainability, and communication potential.

Case Study: McKinsey’s Differentiation Journey

Perhaps no business better illustrates the evolution of strategic differentiation than McKinsey & Company. In an industry where competitors often appear interchangeable, McKinsey has maintained premium position through a sophisticated differentiation strategy combining all three differentiation sources.

The Challenge: Professional Services Differentiation

Management consulting poses fundamental differentiation challenges:

• Intangible services difficult to evaluate before purchase
• Similar-appearing firms with comparable backgrounds and approaches
• Limited observable differences in actual delivery process
• Widely claimed attributes across almost all competitors

These challenges make genuine differentiation both crucial and exceptionally difficult to establish and maintain.

McKinsey’s Differentiation Evolution

McKinsey’s differentiation strategy has evolved through several distinct phases, each building upon previous foundations:

1. Knowledge Leadership Differentiation (1960s-1970s)

McKinsey’s initial differentiation centred on establishing themselves as knowledge leaders rather than just service providers. This began with the launch of the McKinsey Quarterly in 1964, creating a resource-driven differentiation through proprietary research and thought leadership.

While other firms focused exclusively on client service, McKinsey invested significantly in knowledge development, systematically capturing insights from engagements and transforming them into frameworks, methodologies, and published research.

This knowledge differentiation created multiple advantages:

• Demonstrated expertise before clients engaged the firm
• Established thought leadership position beyond service delivery
• Created tangible evidence of otherwise intangible capabilities
• Built cumulative advantage through continuous publication

As former managing director Marvin Bower explained: “Our knowledge investment isn’t just client service; it’s the foundation of our distinctiveness.”

2. Talent Differentiation (1970s-1980s)

Building on knowledge leadership, McKinsey developed a second differentiation layer through distinctive talent approaches. Their elite recruitment model—focusing on top-tier institutions with rigorous selection processes—created a talent pool perception that separated them from many competitors.

More importantly, they systematically developed their alumni network as a strategic asset rather than viewing departing consultants as losses. This approach created a powerful resource differentiation:

• Placement of alumni in client organisations created trusted relationships
• Successful former consultants became advocates and potential clients
• Alumni achievements reflected positively on the firm’s capabilities
• Network expansion created cumulative advantage difficult to replicate

This talent differentiation reinforced knowledge leadership while adding relationship advantages that competitors struggled to match.

3. Methodology Distinction (1980s-1990s)

As knowledge and talent approaches became more widely adopted across consulting, McKinsey added capability-driven differentiation through proprietary methodologies. From their 7-S Framework to their Nine Box Matrix, they developed distinctive approaches that expressed their unique perspective on business challenges.

This methodology differentiation created additional separation:

• Distinctive approaches that translated knowledge into action
• Proprietary frameworks that crystallised their problem-solving approach
• Consistent client experiences through methodological standardisation
• Tangible tools that made their approach more concrete and memorable

4. Prestige Positioning (1990s-Present)

Perhaps most powerfully, McKinsey developed philosophy-driven differentiation through deliberate prestige positioning. Their selective client relationships, premium pricing, and distinctive engagement model created separation based on fundamental values about how consulting should work.

This philosophical differentiation manifested throughout operations:

• Working exclusively with top executives rather than middle management
• Maintaining premium pricing regardless of market pressure
• Focusing on strategic issues rather than operational implementation
• Emphasising insight over execution in engagement design

As former managing director Rajat Gupta noted: “Our differentiation comes from choices about what we won’t do as much as what we will.”

The Integration Effect

What makes McKinsey’s differentiation particularly powerful is how these elements reinforce each other in a coherent system:

• Knowledge leadership attracts elite talent, which generates new knowledge
• Prestige positioning justifies premium pricing, enabling knowledge investment
• Methodology distinction supports prestigious relationships, enhancing the alumni network
• Alumni networks provide new engagement opportunities, creating additional knowledge

This integrated approach creates differentiation far more sustainable than any single attribute could provide. Rather than relying on a particular feature or capability, McKinsey has built layered differentiation that competitors would need to replicate across multiple dimensions simultaneously—a substantially more difficult challenge.

Counter-Example: Deutsche Bank’s False Differentiation

To understand the consequences of failed differentiation, consider Deutsche Bank’s investment banking division. Despite substantial investment in claimed differentiation, they struggled to establish meaningful separation from competitors, contributing to years of underperformance.

The Claim vs. Reality Gap

Deutsche Bank consistently claimed “client-focused innovation” as key differentiation. Their marketing materials, executive statements, and strategic plans emphasised:

• Innovative financial solutions beyond conventional banking
• Client relationships based on true understanding of needs
• Sophisticated risk management approaches
• Global reach with local expertise

However, objective analysis revealed limited operational distinction from other global investment banks:

• Product offerings largely identical to major competitors
• Client engagement models following industry-standard approaches
• Risk methodologies comparable to regulatory requirements
• Geographic coverage similar to other international banks

This gap between claimed and actual differentiation created several critical problems:

1. Credibility Erosion

Sophisticated clients easily recognised the disconnect between differentiation claims and operational reality, undermining trust in the bank’s broader communications. As one former client told researchers: “They claimed unique approaches, but delivered exactly what we’d get from any other bank on Wall Street.”

2. Internal Confusion

Without clear operational differentiation, employees struggled to understand how their work should differ from competitor approaches. This created inconsistent implementation and strategic drift as different teams interpreted “client-focused innovation” through their individual perspectives.

3. Price Pressure

Without meaningful differentiation, services became increasingly commoditised, creating severe price pressure. As former CEO John Cryan acknowledged in 2016: “We’re stuck competing on price because clients see limited difference between our offerings and alternatives.”

4. Resource Misallocation

Most damagingly, the bank invested significant resources in initiatives that didn’t create meaningful separation, diverting funding from potentially distinctive opportunities. Their attempts at incremental improvement on standard services prevented focused excellence in areas where real differentiation might have emerged.

The Lessons: Aspiration vs. Operation

Deutsche Bank’s experience illustrates critical differentiation principles:

1. Operational differentiation must precede communication. Claiming distinction without operational reality undermines credibility.

2. Incremental improvement rarely creates meaningful separation. Being marginally better at what everyone does creates limited differentiation value.

3. Generic differentiation claims are worse than none. Claiming common attributes as distinctive creates customer cynicism.

4. Successful differentiation requires trade-offs. Deutsche Bank’s attempt to differentiate while maintaining comprehensive offerings prevented the focus required for genuine distinction.

As strategy professor Michael Porter noted when discussing the case: “They wanted the benefits of differentiation without the costs of actual differentiation—the hard choices and trade-offs that create genuine separation.”

The Differentiation Diagnostic Tool

To apply these principles to your own business, the Differentiation Diagnostic Tool provides a systematic approach to identifying, validating, and leveraging your true differentiation:

1. Attribute Identification

Begin by identifying potential differentiators across all dimensions:

Product/Service Attributes:

• [List all potential distinguishing features]
• [List potential structural differences]
• [List unique combinations or integrations]
• [List unusual priorities or design choices]

Process/Methodology Attributes:

• [List distinctive approaches or methods]
• [List unique processes or techniques]
• [List workflow differences]
• [List unusual priorities or values that shape methods]

People/Culture Attributes:

• [List values that visibly influence decisions]
• [List team composition differences]
• [List unique perspectives that drive approach]
• [List cultural elements that create distinctive outcomes]

Business Model Attributes:

• [List economic structure differences]
• [List unusual resource allocations]
• [List pricing or revenue approach differences]
• [List strategic trade-offs]

2. Uniqueness Validation

For each attribute, assess genuine distinctiveness:

For each potential attribute:

• Uniqueness Score (1-10): How genuinely different is this?
• Evidence: What proves this uniqueness objectively?
• Competitor Comparison: Who else claims/has this attribute?
• Customer Verification: How do customers describe this difference?

Eliminate attributes scoring below 7, focusing only on truly distinctive elements.

3. Value Assessment

For validated unique attributes, assess customer importance:

For each unique attribute:

• Importance Score (1-10): How much do customers care about this?
• Evidence: What proves customers value this attribute?
• Premium Potential: Would customers pay more for this difference?
• Decision Impact: Does this influence selection decisions?

Eliminate attributes scoring below 7, focusing only on valued distinctions.

4. Sustainability Evaluation

For valuable unique attributes, assess defensibility:

For each valuable unique attribute:

• Imitability Score (1-10): How difficult is this to copy? (10 = impossible)
• Protection Mechanisms: What prevents competitors from replicating?
• Maintenance Requirements: What ongoing investment is needed?
• Evolution Potential: How can this difference be strengthened?

Eliminate attributes scoring below 6, focusing on sustainable differentiation.

5. Differentiation Priority

Calculate Combined Score: Uniqueness × Value × Sustainability Rank attributes by combined score Identify top 3-5 differentiation priorities to emphasise

Example: ustwo Digital Product Studio

To illustrate this process, consider how digital product studio ustwo might apply the Differentiation Diagnostic:

Attribute Identification:

• Product/Service: Integrated design and development capability; game development expertise; award-winning products
• Process/Methodology: Studio-based collaborative approach; design-led problem solving; creative experimentation emphasis
• People/Culture: Cross-disciplinary teams; studio culture vs. agency structure; product craftsmanship values
• Business Model: Creating own products alongside client services; selective client partnerships; project-based vs. retainer model

Uniqueness Validation:

• Attribute: Monument Valley game development

  • Uniqueness Score: 9/10 (few agencies create their own successful products)
  • Evidence: Award-winning game with millions of downloads
  • Competitor Comparison: Most digital agencies lack successful own products
  • Customer Verification: Consistently mentioned in initial client conversations

• Attribute: Studio culture approach

  • Uniqueness Score: 7/10 (uncommon but not unique in digital space)
  • Evidence: Physical environment and team structure differs from agencies
  • Competitor Comparison: Some competitors have similar approaches
  • Customer Verification: Clients note different experience when visiting

• Attribute: Integrated design-development capability

  • Uniqueness Score: 6/10 (increasingly common approach)
  • Evidence: Teams include both disciplines from project start
  • Competitor Comparison: Multiple competitors now offer similar integration
  • Customer Verification: Rarely mentioned as distinctive by clients
  • Decision: Eliminate due to insufficient uniqueness

Value Assessment:

• Attribute: Monument Valley game development

  • Importance Score: 8/10 (creates credibility for digital product capability)
  • Evidence: Frequently mentioned in client selection rationale
  • Premium Potential: Supports premium pricing vs. traditional agencies
  • Decision Impact: Creates consideration for projects requiring excellence

• Attribute: Studio culture approach

  • Importance Score: 6/10 (appreciated but rarely decision-critical)
  • Evidence: Positive mentions but limited selection impact
  • Premium Potential: Limited direct pricing impact
  • Decision Impact: Secondary factor in selection decisions
  • Decision: Eliminate due to insufficient value impact

Sustainability Evaluation:

• Attribute: Monument Valley game development
  • Imitability Score: 8/10 (difficult to replicate success in gaming)
  • Protection Mechanisms: Established brand and market position
  • Maintenance Requirements: Continued game development investment
  • Evolution Potential: New titles and platforms can strengthen position

Differentiation Priority:

• Monument Valley and product development capability emerged as prime differentiation to emphasise and strengthen
• This differentiation combines resource advantage (the actual game) with capability advantage (demonstrated product excellence)
• Key opportunity to evolve through continued product development that reinforces this distinctive attribute

The Bidirectional Relationship: How Differentiation Refines Essence

While we’ve primarily focused on how essence informs differentiation, it’s important to acknowledge that the relationship works both ways. The process of identifying and validating differentiation often reveals essence elements that weren’t fully articulated or understood.

This bidirectional relationship creates a virtuous cycle where essence guides differentiation identification while differentiation work simultaneously clarifies essence understanding.

Consider these patterns where differentiation work can enhance essence clarity:

1. Revealing Hidden Essence Elements

The process of examining what genuinely differentiates you often reveals aspects of your essence that were present but unarticulated.

When HubSpot conducted their differentiation analysis, they discovered that education was a more central essence element than they had previously recognised. What began as content marketing to generate leads revealed a deeper philosophical commitment to customer education as fundamental to their approach.

This insight didn’t change their essence but revealed a deeper understanding of what had been there all along, subsequently strengthening both their essence articulation and differentiation strategy.

2. Clarifying Essence Priorities

Differentiation work forces clarity about what aspects of essence are most distinctive and valuable, helping prioritise among multiple essence elements.

When TransferWise (now Wise) conducted their differentiation diagnostic, they discovered that financial transparency resonated more powerfully with customers than their technical innovation. This didn’t change their essence but clarified which elements deserved primary emphasis, strengthening both internal alignment and external positioning.

3. Finding Essence Language

Sometimes differentiation research provides more resonant, accessible language to express essence elements that were understood internally but poorly articulated.

When Basecamp explored their differentiation, customer language around “calm productivity” provided more effective essence articulation than their internal terminology around feature simplicity. This language refinement didn’t change their essence but improved how they expressed it both internally and externally.

As Jason Fried reflected: “Our customers sometimes understand our essence better than we do—or at least express it more clearly. Listening to how they describe our differentiation has profoundly improved how we articulate our essence.”

This bidirectional relationship means differentiation work isn’t just about translating essence into market position, but also refining essence understanding through market engagement. The most successful companies maintain this ongoing dialogue between internal identity and external expression, allowing each to continuously refine the other.

A Final Thought: The Power of Real Separation

As we conclude our exploration of differentiation, it’s worth acknowledging a fundamental truth: meaningful separation in the marketplace doesn’t come from claiming uniqueness but from actually being unique in ways customers value.

The businesses that become the obvious choice in their markets don’t achieve this status through marketing claims but through genuine differences in philosophy, capability, or resources that create distinctive value. Their differentiation isn’t proclaimed but demonstrated through consistent operational choices that alternatives can’t or won’t make.

As you apply the Differentiation Diagnostic to your own business, remember that the most powerful attributes often emerge from essence expression rather than tactical additions. The elements that create true separation typically aren’t features or benefits but fundamental differences in who you are and how you approach your work.

Your quest for differentiation isn’t about finding clever marketing angles but about identifying and amplifying the aspects of your business that are genuinely, meaningfully, demonstrably, and sustainably different from alternatives. These elements create the foundation for becoming the obvious choice—not for everyone, but for those who value what truly makes you different.

In the next chapter, we’ll explore how to translate these distinctive attributes into compelling customer value and develop the proof that makes your differentiation not just claimed but credible.

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The Differentiation Diagnostic Worksheet

1. Attribute Identification

List all potential differentiators across key dimensions:

Product/Service Attributes:

• ---

• ---

• ---

Process/Methodology Attributes:

• ---

• ---

• ---

People/Culture Attributes:

• ---

• ---

• ---

Business Model Attributes:

• ---

• ---

• ---

2. Uniqueness Validation

For each potential attribute, assess:

Attribute 1: ______________________________

• Uniqueness Score (1-10): _______
• Evidence: ______________________________
• Competitor Comparison: ______________________________
• Customer Verification: ______________________________

Attribute 2: ______________________________

• Uniqueness Score (1-10): _______
• Evidence: ______________________________
• Competitor Comparison: ______________________________
• Customer Verification: ______________________________

Attribute 3: ______________________________

• Uniqueness Score (1-10): _______
• Evidence: ______________________________
• Competitor Comparison: ______________________________
• Customer Verification: ______________________________

3. Value Assessment

For validated unique attributes, assess:

Attribute 1: ______________________________

• Importance Score (1-10): _______
• Evidence: ______________________________
• Premium Potential: ______________________________
• Decision Impact: ______________________________

Attribute 2: ______________________________

• Importance Score (1-10): _______
• Evidence: ______________________________
• Premium Potential: ______________________________
• Decision Impact: ______________________________

4. Sustainability Evaluation

For valuable unique attributes, assess:

Attribute 1: ______________________________

• Imitability Score (1-10): _______
• Protection Mechanisms: ______________________________
• Maintenance Requirements: ______________________________
• Evolution Potential: ______________________________

Attribute 2: ______________________________

• Imitability Score (1-10): _______
• Protection Mechanisms: ______________________________
• Maintenance Requirements: ______________________________
• Evolution Potential: ______________________________

5. Differentiation Priority

Calculate combined scores (Uniqueness × Value × Sustainability):

Attribute 1: ______ × ______ × ______ = ______ Attribute 2: ______ × ______ × ______ = ______

Top Differentiation Priorities:

1. ---

2. ---

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