Does Your Marketing Have a Competitive Edge?  

24th February 2003

Some experts and textbooks refer to ‘Sustainable Competitive Advantage’, but I don’t believe in this very dynamic internet-influenced market that any competitive edge is truly sustainable over a period of time, except for a few corporate exceptions such as McDonalds. However, we do need to have a competitive edge in our chosen markets. Being competitive puts you in the race in the first place, but the edge will help you win.

Having a competitive edge can also be referred to as a point of differentiation. When developing a differentiation strategy, an organisation will aim to develop characteristics of certain elements of its business, which are of value to its target customers. These will vary between industries, for example, in the early days of mobile networks, availability (or coverage) was key, which gave Telstra a significant competitive edge. In some retail environments, product range may be the differentiator for stores which carry the broadest or most comprehensive range of products.

Broadly speaking, points of difference or competitive edge can be developed in several categories:

- distribution/availability

- service (quality, features, promptness, courteous, convenience, speed, delivery, etc.)

- price (premium, discount, volume, sliding scale, payment terms, etc.)

- innovation (this is critical to product and service features staying ahead of the pack. Without innovation, a company’s products will only be able to maintain any competitive edge for a given period of time, before innovation creates new features and benefits and new points of differentiation).

Underpinning these broad characteristics, in most organisations, are effective systems and processes (such as the McDonalds example). The better organised the company, the more nimble it will be in achieving lower cost production, higher quality products, responding to competitive pressures, to customer requirements, and to producing and implementing innovation.

What sort of characteristics or strategies can help deliver this competitive edge? Remember, a competitive edge can be real or perceived. In order to determine how to develop the right competitive edge for your business, you need to assess the external and internal dynamic of the market in which you operate.

Your competitive strategies will need to be based on a sound, and realistic, grasp of the following:

1. understand your customers – have an intimate understanding of how you can deliver value to them
2. understand your competitors and what their game-play is and how they do/would deliver value to the customers
3. identify gaps and opportunities in the market for adding value
4. understand your own strengths & weaknesses, and core competencies – know what you can and can’t deliver (under promise and over-deliver, not the other way around!)
5. understand your critical success factors

Work through these five key assessment areas, then look at the broad categories of differentiation outlined above, to develop the best competitive strategy for your product/service or business.

Be honest, be bold, be committed to the game!