Commoditization vs Differentiation in Telephone Interpreting

How are one company's phone interpreting services different from another? Is there really any significant point of differentiation? For the most part, we see a lot of "me too" OPI (over-the-phone interpretation) companies out there.

Looking at the websites of any of the Top 15 Telephone Interpreting Companies (free registration with Common Sense Advisory required), you'll see that everyone looks very similar. Language Line Services (LLS) at least has the name (like Kleenex or Coke) that everyone thinks of first, it is the largest, and it provides a good service, so LLS is in a seemingly immovable first place position. Looking at the websites of NetworkOmni, Language Services Associates, LLE, Telelanguage, CanTalk, Certified Languages International, CTS Language Link, and others, it is difficult to pick out any real point of differentiation, or even some superficial but perceived point of differentiation. Maybe they do offer some great differentiation behind the scenes, but they are doing a lousy job of marketing it - they all offer "100+ languages, 24/7 access, convenient pricing, blah blah blah."

Pacific Interpreters at least communicates a clear focus on health care interpreting, so health care clients may be more likely to use their service. Cyracom goes one step further by highlighting that it is "exclusively endorsed by the American Hospital Association" thus communicating at least a perceived edge in quality. According to the same CSA report mentioned above, Pacific Interpreters and Cyracom were going neck and neck in 2007 when competing to be the most serious contender for market share against LLS. Maybe that differentiation by market focus has something to do with their success.

The translation industry is constantly fighting perceived commoditization, so it should come as no surprise that the OPI industry would be doing the same. Evidence of this can be detected in public price wars. CSA identified steady price erosion in the same report above. When Language Line's revenues stagnated during most of the past decade (in spite of a steadily growing total market), it became clear that LLS was losing many large contracts by as little as one cent to more eager up-and-coming OPI firms. As would be expected, these eager firms can't hold up for long in a price war with the giant LLS, and rumor has it that most of the major clients lost on price have returned again to LLS.

So, hypothetically speaking, how could an OPI firm overcome this perceived commoditization and really achieve a true competitive advantage and win market share from the giant LLS? (Or how could LLS break away from the pack even more?) Winning on cost appears to have a short shelf life. Winning on market focus appears to be going well for Cyracom and Pacific Interpreters, but that can obviously restrict the size of the total available market. That covers two of Porter's generic strategies to achieve and maintain a competitive advantage. The third and final strategy would be differentiation, and it is difficult to find much evidence of any OPI firm with true differentiation.

If you have an idea, or if you have seen great OPI differentiation that has not yet been communicated through good marketing, I would love to hear about it and I'm sure these other companies would too). Post the idea as a comment or email me directly. The differentiation could be real or perceived, as long as it would convince clients and create a competitive advantage.