Marketing Mistake #7 – Not having competitive advantage

Dear Reader

Why should people buy from you? Better yet, why should they do business with you as opposed to doing nothing?

Are you the fastest? Do you have a better than industry standard guarantee? Do you offer extra value in some sort of way? Do you have some sort of edge that the competition doesn’t?

If you have a compelling reason for people to do business with you then... You will start to convert more prospects into clients, get clients to buy in more quantities and get those customers to come back more often.

Not having some sort of competitive advantage can:

·         Start a price war.  Shop A lowers their price to compete with shop B.  Shop B in turn drops its price to compete back.  Soon shop A and B both struggle to turn a profit.

·         Without any competitive advantage you will receive the worst type of customer of all – the price buyer.  This buyer is only motivated by price.  If he can get it 0.10c cheaper somewhere else he’ll do it.  He is not loyal to your brand since he is only motivated by price. 

·         Getting no referrals from customers. In fact, why should they refer their friends when their friends can get the same thing almost anywhere?

·         Lower closing rates for your salespeople. It’s hard to sell something that’s available everywhere. (They will get the classic, I’ll get back to you response)

·         Lose total market share and so forth.

So you need to create some sort of buying edge. A competitive advantage, a unique selling proposition, whatever you want to call it. How many of the big boys have one? Ha! All of them! Take a look:

Head & Shoulders – You get rid of dandruff

Olay – You get younger looking skin

Domino’s Pizza – Fresh hot pizza, delivered to your door in 30 minutes or less or it’s free

Fedex – When it absolutely, positively has to be there overnight

M&M’s – Melts in your mouth, not in your hand

Wonder Bread – Wonder bread helps build strong bodies 12 ways

Nyquil – The nighttime, coughing, achy, sniffling, stuffy head, fever, so you can rest medicine.

BMW – The ultimate driving machine

Avis – We are number two, we try harder

Coca Cola – The real thing

You get the idea right? Is it easy to create one for your business? Heck no, it’s the hardest part. It’s the reason people hire me. Luckily, there are only a few ways to develop one. In fact, I’ve boiled it down to only 5 main categories to create your competitive advantage.

Raymond’s Five Categories For Competitive Advantage:

1.      Be the price leader

2.      Position your company

3.      Own an attribute

4.      Offer extra value

5.      Develop market speciality

Who’s the price leader? Walmart. Who positioned themselves? Olay. Who own’s an attribute? BMW. Who offers extra value? Avis, they try harder. Let’s switch gears and let me give you a local example: Which company in South Africa has market speciality as their competitive advantage? Answer – Curves for women, since they only sell to a specific market.

Are all competitive advantages alike? Nope. Some are stronger than others. Positioning your company as being the first in the industry must undoubtedly be the most powerful competitive advantage or USP you can create. You can then pound your chest and proudly say we are the best because we invented it.

You know what’s a really, really, really easy way to find a competitive advantage? Marketing arbitrage. But for that, read on to marketing mistake number 8.