Saturday, 24 September 2011

Strategy: out compete the competition

How to outcompete the competition 



In mature often saturated markets developing a unique strategic position which gives you sustainable competitive advantage in your market is the holy grail for business owners. To be somewhere that your competitors aren't, and to have something that cannot be taken away is what everyone setting up in business dreams of achieving. It is one clear defining way of out competing the competition is to develop a sustainable competitive advantage in a market



Sustainable Competitive Advantage


Few companies can lay claim to that holy grail position for any length of time, here are some that come immediately to mind: Ferrari, Rolls Royce Engines, Hoover, Apple's Iphone and Ipod, Boeing, Walkman, Sky, Microsoft Windows, are all good examples of companies who have achieved, or are holding it today. 




Dyson





To be recognised as the market maker such as Hoover gave it unbelievable control of the market for most of the 20th century, not only owning the market it was even named after them. What changed? A loss of focus and desire to continue to own the market coupled with the airplane ticket fiasco which opened the door to new competitors and to one man in particular James Dyson  who grabbed the opportunity to replace Hoovers once held position in the market launching his own Dyson brand through technology shift of his cyclone bag less vacuum. 





His passion, created from vacuuming at home and becoming frustrated, seeing the cyclone idea at a sawmill which then took 15 years, 5,127 prototypes to turn into a winning product, which today benefits upon 60% recommendation purchases and has allowed Dyson to spin his cyclone technology into air dryers and washing machines. 









Features of Strategic Competitive Advantage 



What are the key features of sustainable competitive advantage for any company in their market, well here are the most commonly found top five:-



  • Charge a premium for its services; even low cost suppliers out price other low cost suppliers.
  • Lead the market by innovation; will get to market new ideas quicker or in a more dominant market shift way.
  • Controls the key channels to market; from buying decision processes to pricing structures.
  • Owns the pace of change within the market; from technology development and consumer shift
  • Control of buyer activity; the significant majority of the share of buy (SOB) and share of space (SOS) through its dominance.   


To achieve sustainable competitive advantage is extremely difficult, most companies manage to reach a challenger market position. For that to happen their has to be a clear vision of where the company is going and where the market opportunity exists. For men like James Dyson the advantage was that he was in the right place at the right time, with the right product that enabled a technological shift in the market with his bag less vacuum.



If you want to develop your company's position then there needs to be a vision for it, where it is going and why. If your look for some advice on developing your company, its marketing, its sustainable competitive advantage then contact us at Cowden Consulting to see how we can assist you, or read more about us in this blog or at Cowden Consulting.

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