4 Ways to Differentiate Your Retail Business to Rise Above Your Competition

Differentiate your business | Shopify Retail blog

More than half a million small businesses open every year. While that number is encouraging for entrepreneurs, it can also be scary to already-established retailers.

With the competition growing, it’s becoming more important to find ways to stand out.

Differentiating your retail business from others in your industry can help you make a stronger impression among prospective customers — and attract more sales.

Finding ways to differentiate your business from the rest requires a little bit of research and creativity — there’s more to it than just offering great value. You need to take a holistic approach to make sure the entire brand experience differentiates your business and turns new customers into forever fans.

Ways to Differentiate Your Retail Business

Differentiating your retail business can happen in one or many areas: 

  • Product
  • Customer Service
  • Brand
  • Price


One of the most straightforward ways to differentiate your retail business is through your products. Do they offer something unique that your competitors’ products don’t? Are they the first of their kind? Or maybe they are an entirely different type of product than what your competitors typically sell, as is the case with Boulevard Brewing Company.

The Kansas City-based brewery has a robust retail experience where customers can purchase the standard brewery T-shirts, hats and glasses. But Boulevard offers beer drinkers more than the typical beer swag.

In addition to the staples, you’ll find camping gear, beard wax, barbecue sauce, and home decor — among others. Where customers might think, I don’t need another brewery T-shirt, Boulevard changes the internal dialogue to, Which will get more use: the beer socks or the beer-scented candle?

Outside of physical products, you could also incorporate services into your retail business. This can differentiate your retail business by providing additional offerings that your competitors can’t match. Plus, you’ll provide an element of convenience for your customers.

Customer Service

For some retailers, the secret is in customer service. One survey found that consumers rank customer service as the No. 1 area retailers need to work on, ranking above No. 2 high-quality products and No. 3 low prices. 

Neglecting customer service could be a huge mistake. In fact, it’s reported that U.S.-based companies lose $41 billion every year because of poor customer service experiences.

Take a look at some of the larger retailers that have a loyal customer following: Nordstrom hems jeans for free, and the staff are as close to personal shoppers as you can get without hiring one; REI allows free returns, no questions asked, for up to one year after the date of purchase; similarly, SmartWool will take back any damaged clothing and replace it for free if within a year of purchase.

These customer service policies go a long way when it comes to differentiating your business. Give your customers something in return for their business: free shipping, easy returns, product satisfaction guarantee, etc. Without good service, your product offerings and price point might not matter to a potential customer.

FURTHER READING: For more ideas on upgrading your customer service, read about 7 retailers who have embraced modern customer service methods.


Your brand identity is essential to your success. Almost two-thirds of global consumers say they build relationships with brands over shared values. Taking a look at your brand identity can inspire ways to differentiate yourself from the competition.

Your brand identity should establish who you are and what you stand for. For Priscilla Tsai, founder of skincare company Cocokind, it was about encouraging women to love their skin — acne-free or not.

Not only did she take a stand by offering vegan products, but she also provided a voice for women who need her product. This makes her brand relatable, and customers more likely to support Cocokind over another, identity-less skincare brand.

Incorporate your brand identity into your physical store, make sure it’s reflected in your logo, and use it across all communication touchpoints, including email and social media. 

Create a community in your store and around your brand, just as Tsai has done, along with these other successful community-building retailers.


Arguably more straightforward than differentiation through products themselves, adjusting your price point can be a surefire way to stand out.

Dollar Tree has built an entire brand on price differentiation — everything is $1 or less. Their customers depend on them for the consistent, competitive, and affordable price point.

If you can’t get your prices aggressively low, you could also consider price match. Best Buy, for example, offers price matching on most of its electronics. This helps customers feel confident that they’re getting the best deal possible, even if it isn’t the deal that Best Buy has advertised themselves.

Tips on Differentiating Your Brand

Consider the Entire Customer Experience

Consider the entire customer experience, from the first time they visit your site, through check-out, and all the way to any post-purchase communications. Each of these steps provides a unique opportunity for you to differentiate your brand. 

If your products are what differentiates you, put them front-and-center on your website and blast them on social media. Highlight them in your physical storefront. If you’re more committed to your brand identity, make sure your brand voice comes through on the receipt.

Beyond standing out for all the right reasons, you need to avoid standing out for all the wrong reasons. If your check-out experience is clunky and requires too many steps, customers are going to remember the aggravation. If you don’t accept all common payment types, there’s another bad impression and potential lost sales.

Exclusivity can also enhance the customer experience. Some retailers only offer discounts to their most loyal customers or customers who’ve spent a certain amount of money, other retailers might host invitation-only private shopping events. Any time you make a customer feel special or like they’re part of a secret club, you’re enhancing the experience and differentiating yourself from retailers who don’t have any exclusivity. To learn more about creating a captivating loyalty program, read our guide on building one.  

Another way to enhance the customer experience and stand out is through in-store personalization. Loyalty programs, in-store technology, and a multichannel approach can take the shopping experience from run-of-the-mill to highly memorable.

Do Your Research

It’s important to understand the competitive landscape so you know what you’re differentiating your business from.

Check out their social media channels and do some in-person sleuthing in their stores to find out what experience they’re delivering. Discover their strengths and identify their pitfalls so you know exactly where your biggest opportunities lie. Strategize how you can double down on successes and learn from their mistakes.

If you have any connections who are in a similar industry or location as your retail store, you could also pick their brain to find some ideas that could be applicable to your own business.

Get Your Team On Board

Along the lines of making sure you’re considering the entire customer experience, it’s important not to overlook your staff — especially your sales and customer support teams. Your employees should be helping you differentiate your business.

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Tell them what your goals are, give them the lay of the competitive landscape, and train them well on how they can uphold your brand differentiation standards.

To Be Successful, You Must Commit

As with most strategies and goals for retailers, you’re only going to see success if you truly commit. Consistency and dedication are key for long-standing and sustainable results.

While consistency is important, also remember to be flexible enough to pivot when strategies are working more or less successfully than anticipated. Your competitors are likely to catch up with you at some point, so always be on the look-out for new ideas on how to differentiate your retail business.

How do you differentiate your retail business? Do you focus on product, brand, customer service, price or a combination of more than one?