I think that you can differentiate your business even if there is no OBVIOUS differentiator. I heard a question recently... maybe from Seth Godin (don't remember)... that said:
If your business ceased to exist tomorrow, would anyone care?
And there are all types of strategies that you can put into place to make people care (even if you have no obvious differentiators).
Computer Repair was differentiated by the marketing of GeekSquad. With the Men In Black Suits, etc. Even a non-differentiated service like airfare - where you can compare all the prices in an instant by a price aggregator -- has beed differentiated by Southwest Airlines. Where they differentiate the way the board the plane, the way you buy your ticket, how you accumulate points, etc.
As a result, people become fiercely loyal. So I have to agree with some others on this thread. What are the painpoints of your customer, and how can you create a differentiator that makes it appear as though you have no competition for the unique way that you provide the service.
Rick
