Brand Differentiation: 5 Ways to Stand Out During the Great Startup Wave

It’s the perfect storm in the startup space. First, the pandemic, plus the Great Resignation, plus the “if not now, then when?” mentality equals more new business applications than ever on record in 2021, outpacing even 2020 which was a banner year for starting businesses. Attention must be paid to brand positioning more than ever before.

It’s hard enough to be a startup without competition. Today, with potentially tens or hundreds of companies trying to do exactly what you want to do simultaneously, it’s overwhelming.

For many years, startups were in a sparse field of competitors, could lean on their products’ attributes to differentiate themselves and spend money on social media ads and watch the algorithms work their magic. The cash would roll in. That is not today’s reality.

Following are five key learnings to help your startup stand out from the pack.

1. Decide what your greater contribution is to culture.

Since entering the startup world after years of working with legacy brands, what I quickly noticed is how product-forward startup communication tends to be.

When speaking to many startups about differentiation, I discovered their perception of their difference was rooted in their product description from their investor deck. What was almost always missing was a bigger insight about how people behave and where culture is going beyond the category that underpinned their reason for being.

The first page of any deck you write introducing someone to your brand should be an explanation of  why you actually exist.

Identify what you’re championing or railing against. This will create a springboard for your communication to be rooted in purpose and product. And today, that’s what buyers want. They want a reason to belong to a brand and a reason to believe in your product.

Toothbrushes are a good example. They look the same and they function similarly. Just because you make toothbrushes doesn’t mean you can only be in the teeth cleaning business. You can be in the business of “instilling confidence in every child,” or “increasing the average number of daily smiles shared in the world.” The product becomes proof of the purpose of your brand, not the story of it.

2. Positioning, positioning, positioning.

Brand positioning is a necessity when bringing any product to market. Companies often abandon brand positioning for product positioning.

Brand positioning is basically how you want your brand to show up in the minds of your customers. It goes hand in glove with the reason you exist as covered above, but one level down — closer to your product.

Brands that only talk about product and function are playing the short game.

Many products are challenged to adapt quickly to changing competitive environments. However, they can maintain their power through a strong and unique brand purpose and positioning that includes emotional benefits. That’s what’s so great about brand positioning. If it’s strong, it can be your rock and carry you through times when it gets harder to differentiate.

3. Invest in the all-important step of determining your conceptual target.

Your target audience is more than a demographic. It’s more than people you think will use this product because there is projected growth among that audience in your sector.

All of this is important, but what is equally important is the mindset of that person. Tribes begin with shared values and you want a tribe of people rallying for your brand.

You must understand the values that your customer sees as important and tap into them. What’s the tie that binds your potential customers? What do they care about? What’s their lifestyle like (beyond how they use your product in your category)?

When competition is fierce, you can bet that if you define your customer by category consumption and demographic alone, you’ll just be competing for the same keywords, the same customers with the same message.

The consumer target is your starting point for your brand positioning. Getting this right and taking a values-based approach to identifying your target audience is crucial to creating strong, emotionally connected, and differentiated communication approaches.

4. Context is everything, especially in brand positioning.

Even though you’ve put tons of time, attention, and resources into your brand, you still have to be willing to change it.

You can’t be stubborn when the category competition demands that you pivot. You can’t reinvent your product in response to each new competitor. Instead, you need to stay on top of your brand message. Use it as a means of addressing and responding to the changing competitive landscape.

The biggest challenge for startups is their competition. Today, functionality and cute names won’t allow you to weather a competitive storm. Staying on top of your competitive context and reevaluating your brand positioning as new entrants come into the category is imperative to ensure you’re still standing out.

Additionally, cultural changes may affect the uptake of your brand. As a result, it’s important to stay connected to behavior trends and cultural movements happening around you to either use to your advantage or to stand against.

5. Be honest with yourself.

I recommend the classic “wall test” to see how your brand stacks up against others and if it’s indeed differentiated.

Throw everything in your category up on the wall. Do you look like everyone else? Are you using the same words? Behaving the same way? Using the same playbook? Are you all doing paid social and influencer and search?

If you don’t look, talk, or behave differently and you use all the same tactics, the winner is the person who can spend the most. That’s not real differentiation.

The faster you transcend product with your brand, the better. You have to rise to an emotional and cultural story that’s authentic and harder to replicate.

Once you have a clearly defined brand purpose and position rooted in a strong conceptual target, the rest of your messaging and choices come from a position of much greater strength.

Startups start because they found a hole where innovation should be. Don’t abandon that desire to be different when it comes to your marketing messaging and playbook. You were born to stand out, so don’t allow yourself to fit in.