The coworking industry has officially gone mainstream. But with more coworking spaces comes more competition, making it harder to attract and retain members.
That’s where differentiation comes in.
In this article, we’ll walk you through how to differentiate your coworking space and create a unique point of differentiation to help you stand from the crowd(ed market).
What is differentiation in coworking?
Differentiation in coworking involves identifying and promoting the unique aspects of your coworking space that set you apart from the other spaces in your area. It could be the specific community you serve, the amenities you provide, or where in the world you’re located.
Your point of differentiation should be so unique that anyone can see what makes you different after spending a few minutes on your website or chatting with your team.
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What are the benefits of differentiating your coworking space?
Why should potential members choose your coworking space over others? Having a differentiated offering makes this question an easy one to answer.
Differentiation also supports the long-term viability of your business through:
1. Enhanced member retention
Offering a unique service to your members that they really care about can help make you irreplaceable, improving overall member retention. When members are making use of the differentiated service or offering, they’re less likely to leave your space for one that doesn’t offer the same value.
The key here is to really get to know your members. This ensures the service or amenity you offer is something they actually want and will use. If they don’t use or care about what makes you different, it’s not an effective strategy.
2. Ability to charge premium prices
Reasonable consumers expect premium services to come with a premium price tag. If you provide unique value, you create a highly curated member experience that other spaces don’t have. As a result, you can justify a higher base membership cost.
This can be very useful when larger players enter your area with below-market rates. Differentiation helps you avoid price wars that can drag you into a race to the bottom. When you only offer a basic coworking space, you can only charge basic prices…and your competition will be fierce.
3. Improved marketing effectiveness
The world is a noisy place. There are people advertising everywhere, making it hard to capture and keep your prospect’s attention. The sales process becomes much simpler when you offer something valuable and unique that your competitors don’t.
You won’t have to rely on the same advertising message as everyone else. You can make how you market your coworking space stand out by focusing on your unique value-add to draw interest.
When is differentiation important to a coworking space business?
A well-defined differentiation strategy helps your ideal members quickly understand what makes your space special and why it suits their needs.
One might argue that differentiation is always important for your coworking space business. However, a point of differentiation becomes particularly important when:
- There is lots of competition for a local offering
- The category is technical or isn’t well understood
Increasing competition makes standing out a non-negotiable to acquire members. If you’re in a market where coworking isn’t well understood, such as in a rural coworking area, well-communicated differentiation is paramount to helping prospective members understand what you do and who you serve.
Strategies to differentiate your coworking space
In the coworking industry, it’s easiest to differentiate yourself via one of the following three options.
Who you serve: opening a coworking space for a specific underserved population can be a way of differentiating yourself from others. Examples could be a coworking space for parents, a women’s-only center, or a shared workspace for podcasters.
What you offer: offering amenities or services outside of the traditional coworking offerings can help set you apart. Examples are 24/7 opening hours and offering on-site childcare.
Where you’re located: opening a coworking space in a beautiful or remote part of the world can be a way of differentiating yourself and can be a strong selling point in your marketing materials.
Important note: You never want your point of differentiation to be a lower price point. If you rely on attracting members by heavily discounting your offerings, it’ll quickly become a race to the bottom and can threaten the sustainability of your business model, especially if a competitor comes in and outprices you.
How to define your point of differentiation for your coworking space
If you’re just starting a coworking space and you want to create a point of differentiation for yourself, here are three simple steps you can take to get started.
1. Evaluate your competition and identify any unmet needs in the market
The first step in developing a true point of differentiation is to conduct some market research to know what all of the other coworking and flex spaces around you are doing.
At this point, you’ll want to:
- Identify direct competitors
- Evaluate their strengths and weaknesses
- List their point of differentiation (if they have one)
- List any unmet needs
Most coworking spaces will use their point of differentiation somewhere in their marketing materials (more on that later). They may market themselves as a space for business professionals, a coworking space for e-commerce professionals, or the only coworking space with an on-site fitness center. This is one of the most important pieces of information to note down in your research!
2. Write down everything you can about your coworking space
Now it’s time to find out what makes you truly different. Start by listing everything you can about your coworking space. If you created a business plan for your coworking space, then you may have already done this step.
When we say everything, we mean key business details like:
- Your ideal customer profile (ICP) or who you serve
- The amenities you offer (podcast studio, fitness center)
- Your mission and values
- Your product mix (private offices vs. open space)
- The design of your coworking space
- The events you plan to host
From here, compare everything you have to offer with what your competitors offer and find the missing gaps. If there aren’t any, this is your opportunity to make one.
Remember, your point of differentiation is something that makes you unique and that is meaningful to your target audience. See what makes your space shine!
3. Make your differentiation shine in your marketing materials
Now that you have a clear differentiator, it’s time to broadcast it to the world – your differentiator is only as strong as the people who understand it.
In order to ensure your point of differentiation is being heard loud and clear, you’ll want to:
- Highlight your differentiator clearly and consistently: make your unique selling point the centerpiece of your marketing materials, from website headlines to social media posts.
- Showcase your differentiator visually (and emotionally!): use high-quality visuals, member testimonials, and storytelling to demonstrate the tangible and emotional benefits of your coworking space.
- Target and tailor your messaging: design campaigns and content that speak directly to the specific audience your differentiator appeals to.
Make your coworking space stand out
While the coworking industry is generally collaborative and willing to support one another, the ability to communicate to the market what makes your space truly unique will serve you well in getting the members that you want.
Find out what makes you different. Lean into that as much as you can. And most importantly, don’t be afraid to be bold.
Once you know this, you’ll have the recipe for sustained coworking growth and long-term business success – no matter what changes the future holds.
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