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.
How to outcompete the competition
In mature (and often saturated) markets developing a unique strategic position can give a business sustainable competitive advantage. A sustainable competitive advantage in any 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 every business leader wants to achieve in setting up in business, and dreams of achieving. It is one clear defining way of out competing the competition is to develop a sustainable competitive advantage in a market
To be recognised as the market maker, such as Hoover, whose name is synonymous with vacuum cleaners, gave the Hoover brand unbelievable control of the market for most of the 20th century. Hoover, the brand leader owned the global market, with an unparalleled history, and complete market dominance.
So 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 through innovation; will get to market new ideas quicker or in a more dominant way to shift the market to your agenda.
- 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 mind set, being the pace setter in the market.
- Control of buyer activity; the significant majority of the Share Of Buy (SOB) and Share Of Space (SOS) decsions through its dominance.
Sustainable competitive advantage is an extremely difficult goal. Most successful brands only ever achieve their pinnacle manage to reach a challenger market position, one that challenges existing perceptions within a market.
Creating dominant sustainability requires leadership with a clear vision of where the company is going and where the market opportunity exists. It takes leadership with passion dedication and drive for a brand to succeed in moving form a challenger brand to one which can dominate and sustain that domination of its market such as Dyson to succeed. 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.