The best way to answer the What Makes You Different From Your Competitors? question is not to put down your competitor or put yourself up but instead tell a story of how your solution fills a few gaps in the industry and how different things can be with your product.
Don’t justify, explain, or defend your value proposition and competitive edge, there is only one way to convince investors: Show them results! Be specific about the skills you can provide, the best example of a possible answer would be: “I’m not familiar with my direct competition, but I can assure you that I am an excellent fit for the position.
However, once we understand that nothing makes you better than your competitors and that your edge is just a differentiation, is when your business will start making sense.
Okay! That is what will truly make you stand out from others, not because of a coached answer, but because it indeed is different and that is what separates you from your competition.
It is not that you are different or that your business is the best over your competitors, but you just naturally differ and the investors want to know that secret ingredient.
You need to explain why you think a potential customer would pick your product rather than one from your competitors. It could be that your products or your business model are different.
Hopefully, they smile, shake your hand and sign the check! But no…
Sometimes, that is barely ENOUGH, some investors are sent from hell and would at this point ask you to elaborate or explain or break down… Most people freeze at this point but I got an interesting answer to this question from bplans:
For example, you could be offering a basic product with a freemium model while your competitors offer paying products with more functionalities.
Our main competitive advantage will be out of the ordinary food experience offered by Chez Paul.
French cuisine is quite popular and being one of only two French restaurants in the square mile around Restaurant Street should make us a natural point of attention.
We also believe that our focus on social media should give us an edge on our local competition and enable us to attract more customers (especially during off-peak hours). Out of the other 16 restaurants in the area:
only 10 have a website
only 8 have a Facebook page (3 being inactive – no posts in the last 2 months)
only 2 have a blog
only 1 was seen on coupon-based advertising channels (TimeOut, Groupon, LivingSocial)
none are present on Wasilisha
This 7-word question: “What Makes You Different From Your Competitors?” is the best example of a small barrier that can prevent a whole entourage from moving, by standing between you and your next investment.
The truth is that you don’t need to learn how to answer it, if you are indeed different from the competition, because it will just show. Beating your competitor is no longer about them. It is instead about you being so focused on yourself and being non-bothered to the point that you don’t even realize when you beat them.
Start with yourself and focus on a personal solution. Others will automatically see the solutions you offer, even without you saying anything. People will come to you because you are good enough to speak, not only to the decision-maker but also to the one who is going to benefit from what you’re selling.
If that is not good enough to set you apart, highlighting your strengths, and differentiate you from the competition interview question, then I don’t know what is.