Differentiating Your Accounting Practice
Differentiation is the process of distinguishing a product or service from others, to make it more attractive to a particular target market. The concept was first proposed by Edward Chamberlin in his 1933 ‘Theory of Monopolistic Competition’.
For a differentiation strategy to be judged as successful three things need to occur. Firstly, it must move your service from competing based primarily on price to competing on non-price factors such as service quality, reliability, service levels, brand name, service innovation, service features, or distribution channels. Secondly, customers, and potential customers, must have their needs completely met by that service to such a degree that competitors are rendered completely ineffective. Thirdly, the firm grows super quickly by picking up new clients at ease and the financial numbers confirm this fact.
Five possible differentiation strategies for the accounting industry are distribution, service capability, brand name, service levels, and service innovation.