What’s Your Competitive Advantage? Hold on to What’s Sticky in Your Business
November 28, 2017
By: Cathie Ericson
There’s a customer service saying, “You can have it fast, cheap or good…pick two.” While that strikes many as inherently “non-customer-service-oriented,” — as in, shouldn’t your customers get the best of all worlds? — there is also a truth in the concept of knowing your competitive advantage.
Think about the restaurant industry. There’s fast food, which is typically fast and cheap. There’s fast casual, which is usually fast and good, but not cheap. And then there’s fine dining, which takes care of the good, as well as “fast” (or maybe more accurately, attentive) customer service.
But being fast or cheap or even good is typically not enough. “The key to enduring business and investing success isn’t finding an advantage; it’s having a sustainable advantage. Something others either can’t or won’t copy or build off of once your idea becomes popular and profitable,” notes Morgan Housel, a partner at the Collaborative Fund.
Here are four effective ways that small businesses can identify and maximize their competitive advantage:
Is what you offer more of a commodity rather than something completely revolutionary?
Small businesses can use their marketing and brand message to create “perceived differentiation,” that is, highlighting indirect differences, such as touting same-day service or one-stop shopping that can make your company stand out in your customers’ minds.
4. Make it hard to “quit you”
Subscription boxes are having a moment — with growth of about 800 percent between 2014 and 2017 — and it’s easy to see why. Customers sign up once and then automatically receive a box of goods, whether it’s recipe ingredients or beauty supplies, on a regular schedule or paper reams. The company can reap the benefits of those “automatic sales” and the customer can enjoy the convenience of having the items replenished regularly.
Cathie Ericson is a freelance writer covering business and consumer topics. She creates branded content for Fortune 500 companies, and her work has appeared in LearnVest, Costco Magazine, Forbes, TheGlassHammer.com and IDEA Fitness. Follow her @cathieericson.
All content provided herein is for educational purposes only. It is provided “as is” and neither the author nor Office Depot, Inc. warrant the accuracy of the information provided, nor do they assume any responsibility for errors, omissions or contrary interpretation of the subject matter herein.
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