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Why is it important to worry about your competitive advantage in business? What kind of strategies does it take to beat your competition month after month? By definition competitive advantage is the ability to stay ahead of both present and future competition.
Finding your competitive advantage can be easily identified by conducting a SWOT analysis on yourself and the company. This will uncover your Strengths, Weaknesses, Opportunities as well as Threats. This useful tool helps to mend any gaps in your current operations, optimizing efficiency and performance levels.
Therefore, companies must develop their own competitive advantage if they wish to succeed. Honing in on that single attribute that makes you so unique your customers will not be able to refuse is important.
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Here are 7 effective strategies you can utilize to create your own competitive advantage
If you are just starting out your business, take this strategy with a grain of salt. There are just some companies out there that have mastered everything in the industry, creating a tight seal for new companies to enter. In particular, we can look at FedEx, a global logistics company. By continuously optimizing their systems and implementing new strategies to analyze data they have remained on top.
When you are very good at what you do, protect that. You gain a competitive advantage by slowly maintaining growth, not by becoming an overnight wonder.
Start by creating a reputation management plan today!
Cost Leadership Strategy
Have you ever wondered why mega-giants like Wal-Mart or Amazon are always able to beat your price? This strategy is known as, Cost Leadership, and it is simply when you offer the lowest possible cost for a good/service in your industry. This strategy is especially useful for local services in your area. Services shops like JiffyLube and Valvoline must constantly beat each others’ costs to increase business. If they do not, customers will always go with the cheaper option.
Adaptability Competitive Advantage
In this ever-changing world of the U.S. economy, every company needs to be ready to adapt. Simply being capable of adapting will be your competitive advantage. Many larger companies utilize weekly/monthly “trend meetings” for top management or executives. This builds upon their core strengthens by being open to constant change.
Today in 2018 we see a lot of personal branding. Branding is commonly used to differentiate yourself from your competition. When dealing with companies like Nike or Rolex who do not even have to show a product to sell, it is important your customers know why you are worth it. Leverage your distinct competitive advantage, whether it be cost or quality will determine how well you succeed. Companies who lack this fail, and quickly.
The one plus side to this technology boom is that information is everywhere. Make sure you are staying on top of current trends in your industry. Releasing new ideas or goods before the big names do shows your customers that you know the market. This is why we see small niche apparel brands do so well. They know exactly what their customers are looking for and they make it. One of the most shocking examples of this is that of Matīss.
Matīss is a serial entrepreneur and guesses what? He is only 18-years old. After his school hours he would come home and instead of hanging out with friends, he would work on his business. After carefully collecting data of popular goods to sell online he (alone) was able to generate $70,000 in only 6-months. Averaging $3,000/month, Matīss is already more successful than half of Americans. The best part is as Matīss says “This is only one of a few projects I have going on currently.”
The Information Advantage
You are only as good as what you produce. This is why increasing your knowledge is imperative. Every other strategy you implement will depend on how strong your knowledge base is. The literal definition of competitive advantage is outlasting and outpacing your rivals. This is done via knowledge and constant learning. Successful individuals and businesses survive when they seek the latest and greatest in technology, strategies, data, etc.
Technology-Based Competitive Strategy
We believe this goes without saying, but Apple is the epitome of this strategy to a tee. By revolutionizing the way we communicate and use our personal devices is almost unfathomable. Advances in computers and software applications will continue to change leaving this industry up to grabs in the future. Those who implement this advantage over their competition will excel. The key is to develop and redefine your strategies constantly if you are truly seeking to gain a quality competitive advantage.
In addition to the list provided above, there are many ways you can improve your competitive advantage. YouTube is a great source for speakers and a great destination where you can learn new skills online, and for free. Twitter is another excellent outlet for keeping up with what is trending in your industry. When users log in to Twitter they are greeted by a short list of trending hashtags on either the left or right margin. This is a great tool for gaining followers. Sometimes the biggest advantage of all is having the ability to consciously listen and learn from your own target market.
Do you still have questions? Reach out to us ways on how you can further improve upon your competitive advantage. Find out the best ways to motivate your employees. Sometimes it is as simple as being on the first page of Google! What are you waiting for?