How to Choose a Differentiation Strategy to Stand Out From the Competition

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It’s not enough just to advertise that your home care agency has great caregivers and then hope for the best. To stand out to prospective clients and professional referral sources, you need a specific strategy that focuses on a concrete point of differentiation from other agencies.

We’ve talked about it again and again in recent months: it’s not enough just to advertise that your home care agency has great caregivers and then hope for the best. To stand out to prospective clients and professional referral sources, you need a specific strategy that focuses on a concrete point of differentiation from other agencies.

Bottom line: you’ve gotta stand out to succeed.

Why Does Your Agency Need a Differentiator?

You’re probably all too familiar with the challenges of rising competition in the industry. Potential clients have many more choices now than they used to and many home care agencies are reporting that referrals from professional partners and fewer and further between than they used to be.

It’s not that there’s less demand; with 10,000 seniors turning 65 every day, there’s more demand for home care than there’s ever been. It’s simply that there’s also more competition than there’s ever been.

It’s important to note that not only does having a differentiator help you grow revenue by getting more clients, but it can also help to increase your margins by making your clients less price-sensitive.

Note: While we’ll mainly refer to the impact of a differentiator on potential clients and professional referral sources in this article, it’s important to note that this is just as important on the caregiver side: how can you differentiate yourself as an employer?

If Your Differentiator is Quality, You Have to Be Able to Back it Up

Most agencies understand only too well the need to differentiate; however, many agencies get confused on how to create a proper differentiation strategy that puts your agency first in potential clients’ minds and first on professional referral sources’ lists.

Consider this data from the 2018 Home Care Benchmarking Study. Survey participants were asked, “Survey participants were asked, “When speaking with potential clients, referral sources, and your community, what are the top three things you tell them that set your business apart from your competition?”

set your agency apart from the competition

While all of all of these are absolutely essential elements for a home care agency to focus on, they may not be great points of differentiation from other home care agencies because every home care agency says they have these things. Have you ever known of an agency that didn’t claim to have exceptional caregivers, great customer service, or a high level or professionalism?

These factors are very important, but without outside evidence to back them up they’re probably not a strong enough differentiator because they’re things that every agency claims to have.  

If one of these factors is your differentiator, you’re going to need solid proof from someone other than you—otherwise, in the eyes of potential clients and referral sources you’re no different than every other agency claiming to have top-notch caregivers and professional staff.

With that said, let’s talk about how to choose the right differentiating factor for your agency and how to use it to stand out from the competition.

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The Four Tests Your Strategy Needs to Pass

According to Gregg Mazza, a consultant, former home care owner, and founder of Home Care Breakthrough Solutions, a successful differentiation strategy needs three things:

  • It needs to add value to either the client or the referral source

  • It needs to not be widespread in the marketplace

  • It needs to be difficult for competitors to duplicate

We would also add that while your strategy needs to be unique, it also needs to be relevant to a large enough portion of your market for you to stay profitable. (For example, don’t choose to specialize in a condition so rare that there aren’t enough potential clients in the area to support your business.)

Any differentiation strategy you choose needs to pass those four tests.

Ways You Can Differentiate

Here’s a list of possible ways you can set your agency apart. Keep in mind that this list is simply intended as a starting point. Take these suggestions for what their worth, and then do your own research by talking to professional referral sources, clients, potential clients, and even competitors to understand what the needs are in your local area.

Strategy #1: Specialize in a particular condition, such as Alzheimer’s, dementia, or Parkinson’s. Provide your caregivers with a high level of training in this area, create custom care plans for each client, and become the premier option in your area for seniors who need help catered to these conditions.

Strategy #2: Prove your ability to deliver health outcomes, such as readmittance rates to hospitals or care facilities. This strategy if you are heavily reliant on professional referral sources, especially other care providers.

To be successful with this strategy, you’ll need to closely track your rehospitalization rates (and any other relevant stats depending on the referral source) and use them when you meet with referral sources. Many referral sources will prioritize agencies that can demonstrate outcomes.

Strategy #3: Prove that you provide exceptional care. As we said before, this is probably not a successful strategy if you can’t back up your claims above and beyond your competition. However, there’s a lot to be said for simply being the best if you can do it right. This means that someone other than you needs to support your claim of exceptional care. Proving that you stand out in quality of care needs to include some combination of the following elements:

Strategy #4: Come up with a unique program or package for your services. In our February webinar on growing your revenue, Gregg Mazza discussed how his agency packaged their services into a five-point wellness program, emphasizing safety, nutrition, physical activity, mental activity, and socialization.  This program required little change from the services he was already providing, but it marketed the services in a way that articulated their value above and beyond what his competitors were offering.

Strategy #5: Provide a unique guarantee. What you can offer depends on the circumstances and strengths of your agency; however, we’ve heard of agencies who guarantee being able to staff any case in two hours or providing other guarantees of convenience, and service.

As you’re evaluating what guarantee your agency could promise, it’s a good idea to dig into the features offered by your scheduling software to see whether there any features you’re not using yet that could speed up an area of your operations and make a guarantee possible.

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Be Flexible But Committed

As you move forward in deciding on the right differentiation strategy for your home care agency, it’s important you do the right research to identify the needs in your area as well as other competitive offerings.

Once you’ve settled on a strategy, make sure that you can be flexible but committed. Be willing and able to adapt your strategy if needed but be patient and understand that you may not see results immediately.

What challenges have you faced in choosing a strategy to differentiate your agency? Let’s talk about it in the comments below!

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