Many years ago, Michael Porter stated that “a company wins by building a relevant and sustainable competitive advantage.” With that notion in mind, it can therefore be said that having a competitive advantage is like having a gun in a knife fight.
Whilst the aforementioned is true, it should be noted that most advantages in today’s hypercompetitive environment does not remain relevant and very few are sustainable. This is so as advantages are said to be temporary. What does this then means for companies who are seeking to achieve competitive advantages within their respective industries?
A company does not win with a single advantage but by layering one advantage on top of another over time. Japanese companies such as Toyota Motor and Honda Motor have been masters of this. They first entered the Automotive Industry with low prices, then with better features, then with better quality and then with faster performance. This can be attributed to the fact that the Japanese have recognized that marketing is the only race which does not have a finishing line.
Companies can create a competitive advantage from many sources, such as superiority in quality, speed, safety, service, design, and reliability, together with lower cost and lower price as advantages are achieved through a combination of the above-mentioned, rather than a single source.
Therefore, in an effort to create and achieve sustainable competitive advantages, companies should seek to incorporate a set of characteristics that all reinforce each other around a basic idea.
By characteristics, we mean unique practices that will enable companies to charge the lowest prices in their respective industries. It should however be noted that any company that decides to focus on only a few as opposed to all the sources will not succeed in gaining a competitive advantage. This is so as competitive advantage is said to be relative and not absolute.
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All Rights Reserved l Clayton's Marketing Consultancy Services
All Rights Reserved | Clayton's Marketing Consultancy Services