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Compete to Win
Learn the keys to
unlocking your competitive advantage
By Kim T. Gordon
Why should customers do business
with you and not a competitor? If you can't answer that question quickly and
easily, you may be losing customers and market share. It all comes down to
what's called your "competitive advantage" -- an essential component customers
value -- and it's something you do differently or better than your competition.
A strong competitive advantage is the differentiator that makes customers want
to buy from you. And this point of differentiation should be the central theme
in all your marketing messages.
A true competitive advantage
relates directly to a benefit customers value that's unique to your
organization. What benefit do your customers or clients get from your small
business that they can't realize elsewhere? Choosing the right competitive
advantage boils down to understanding what your customers want. It's not about
what you offer, but instead it's about how the customer benefits because of what
you offer.
It's also imperative to examine
what your competitors consider to be their competitive advantages so you can
position against them. Take a careful look at their marketing materials to
discover the unique benefits they promise. Once you understand what your
customers value most and the benefits your competitors use to differentiate
themselves, you can get out of your old "me-too" marketing rut and define your
own unique competitive advantage. Begin by examining these four primary areas:
1. The Products You Market
Whether your company manufactures
and sells its own products or retails product lines purchased from wholesalers,
there are numerous ways to differentiate. For example, if your items are
specially engineered to have fewer breakdowns, your competitive advantage may be
longer lasting, more dependable products. A more comprehensive extended warranty
program than your competitors would deliver worry-free operation and peace of
mind. Or perhaps a wide selection of hard-to-find products can become your
competitive advantage by providing customers superior shopping convenience.
2. The Service You Deliver
Today more than ever,
buyers want to know their post-sale experience will be positive. Companies that
differentiate themselves with top-flight customer rewards programs keep past
buyers coming back for more. And when customers or clients evaluate companies
that provide business-to business or consumer services rather than products,
they choose the firms with services that are distinguishably superior to that of
their competition. How can you deliver added value to your customers through
additional or enhanced services?
3. The Pricing You Offer
In some business categories, price
is a major differentiator. These are areas in which the competitors all offer
parity products and customers are routinely shopping for the best prices on
established brands. In this instance, a company that consistently offers the
lowest price will have the competitive advantage. It also helps to add value by
bundling in services that build buyer confidence and convince new customers that
you are a stable, well-rounded seller. This is particularly critical if your
company is little-known in its marketing arena. Otherwise, many customers will
willingly pay a slightly higher price to a competitor they feel is more reliable
or offers superior value.
4. The Way You Sell
The dry cleaner that's located next
to a subway stop and stays open later in the evenings successfully
differentiates itself from other dry cleaners based -- not on its service alone
-- but on the convenience it provides customers. Get the idea? If you can't
differentiate based on what you sell, it's smart to build a competitive
advantage around how you sell. The winning advantage goes to entrepreneurs who
offer more ways and more times to shop -- 24/7 via the Web, in a
brick-and-mortar store, through the mail, or by phone -- making it easier for
customers to buy.
Get In-depth
Coaching on this Topic>>
Kim
T. Gordon's columns and articles are read by more than
3 million small-business owners each month. She is a small-business expert
and the author of four books, including Maximum Marketing,
Minimum Dollars: The Top 50 Ways to Grow Your Small Business.
Copyrighted material. May not be reproduced in
whole or part without expressed permission from the author. |