Stacking The Deck On Your Competitive Advantage

Everyday our internal logic processes countless of conscious and unconscious decisions. As marketers, the root of our job is to influence the decision making process in order to generate choices that work in our favour. The following examines why the decision making process is more than a cost benefit analysis and offers advice on bolstering your competitive advantage in the mind's eye of the consumer.

People are fickle, but we're generally rational. When someone makes a choice (hiring, firing, choosing a vendor, buying a soda) they're using some sort of internal logic and reasoning to support that choice.

As a marketer, you win when they choose you.

So, why choose you?

The answer to that question is your competitive advantage. What makes it likely that more than a few rational people will consider their options and choose you or your company or your organization?

Truth: It's rarely a computerized cost/benefit analysis. Instead, it's a human choice.

When the factors that matter to me are processed through my worldview and compared against the options I'm aware of, I will choose you when your advantages are greater than the competition, provided I believe that you're worth the cost of switching.

Key points:

Matter to me: Not matter to you or to the next guy, but matter to me. That's all I care about. (Example: it might mean more to me that my friends use your product than it does that you're cheaper).

Worldview: Based on the way I see the world, the assumptions I make, the truth that I believe in. (Example: If I don't trust young people as a matter of course, I'm not likely to choose you if you're young, all other things being close).

Options I'm aware of: If I don't know about you, you don't exist.

Switching cost: The incumbent gets a huge advantage, especially in high cost/high risk/network effect instances.

Some of the ways you might build or maintain a competitive advantage:

• Access to hard-to-replicate Talent
• Hard-earned skills
• Higher productivity due to insight or organization allowing you to be cheaper
• Low cost of living for you and your staff allowing you to be cheaper
• Protected or secret technology or trade secrets
• Existing relationships (switching costs working in your favor)
• Virally organized product and organization
• Large network of users already and a network effect to support you
• Focus on speed
• Monopoly power and the willingness to use it
• Unique story that resonates with the worldview of your target audience
• Shelf space due to incumbency
• Large media budget
• Insight into worldview of prospects--making what they care about
• Emotional intelligence of your salesforce or customer service people
• Access to capital and willingness to lose money to build share
• Connection to community

Not on this list, at least not prominently, are "we are #1!", "we are better!" and "we try harder." Cheerleading skills are not a competitive advantage in most settings. And, with few exceptions, neither is "we are new." Also, "we are better and I can prove it," is rarely a successful argument.

Here's what your board wants to know:

• What's your competitive advantage?
• Is it really, or are you dreaming it up?
• How long will it last?
• Can your competition copy it?
• Does it resonate with the part of the market that is looking to buy?
• Is the advantage big enough to overcome the switching cost?

Source - Seth's Blog