What is the importance of creating a competitive advantage? Your competitive advantage answers the question of “why you instead of your competition?’ Each business has the desire, goal and need to create a competitive advantage in order to attract customers to their business. Unless you set yourself above and apart from your competition, you will not stay in business very long.
What do you offer which is at least different, preferably superior, to your competition?
- Do you offer a higher quality product or service?
- Is your delivery different or more convenient?
- Do you have a more competitive price or terms?
- Is your customer service more convenient or more customer-focused?
Competitive advantage is a major determining factor in the ultimate outcome of your business. Will your business limp along until it collapses in physical or financial exhaustion short of the target finish line? Will you be leisurely strolling from start up to success or will your business be sprinting along the success path and achieving your goals in record time? The strength and implementation of your competitive advantage answers these questions.
Higher quality product or service:
Did you follow the lead of Bill Gates and anticipate the public need for the iPhone or iPad? Build the hype by announcing that you are very fortunate if you can work on one revolutionary new product which changes the industry. Apple has recently announced three new products:
Recommended for YouWebcast: Strategies, Tactics & Tools for Content Marketing in 2015
- a wide screen iPod with touch controls,
- a revolutionary mobile phone,
- a breakthrough internet communications device.
What is Apple’s competitive advantage? They not only improved the smartphone but they created the desire for it before the public even knew they wanted all of the new features.
Hockey star Wayne Gretzky said the secret to his success was to “skate to where the puck is going to be, not where it has been.” This wisdom works with creating a product as well. Create what the consumer will want rather than what he did want decades ago.
Different or More Convenient Delivery
Following this example one step further, they improved the delivery by combining three important functions in one device.
Ok so you are not Steve Jobs and the iPhone has already been created. You could change delivery as Green Earth Cleaners in Castle Pines, Colorado by creating a drop off and pick up system to receive your cleaning at any hour of the day whether the store is open or closed. The even have drive-up service to drop off and pick up. More convenience for the customer is a competitive advantage
Enticing Pricing or Terms
Better quality and more convenience are important factors but the addition of creative terms completes the package. What can you do to make paying for your product more appealing to your customer? Banks have implemented online bill pay, automatic deductions from your bank account, and preauthorized installment payments.
Caution: using price alone as your competitive advantage could result in a price war with a major company. All too frequently, in such a price war, the small business person loses. Before you engage in a potential price war, consider the law of unintended consequences where the big guy can out-resource you and the small business loses it all.
Creative terms which benefit the customer and do not jeopardize the financial longevity of the small business are optimal. American Family Insurance offers installment payments without the hefty service fees so frequently found in such terms. You might choose an automatic bank withdrawal rather than a credit card payment to avoid the credit card fees or opt for the credit card as a customer payment convenience.
Extraordinary Customer Service
Better quality, more convenience, appealing price-per-quality and excellent customer service make the ideal package. What if, just as the iPhone, you could receive everything all in one company with every ordcr? Printplace.com offers a “100% satisfaction guarantee” coupled with a “Price Match Guarantee” of exceptional quality, unbeatable pricing and outstanding service. Print Place has mastered the art of making ordering easy, convenient and satisfaction guaranteed with a wide variety of products and services.
Creating one or more competitive advantages is critical to business success. When you find two or three competitive advantages within the same company, product or service, you have found a keeper.