Vantive Media
Competitive Advantages Blog Post

 Solution Selling

Creating Real Competitive Advantages

Creating, messaging, positioning and promoting real competitive advantages is a difficult undertaking successfully performed by few organizations. While the upside is universally appreciated, the task itself is generally underestimated and few marketers and brand managers successfully develop competitive advantages which directly contribute to their organizations sustained advancement.

With increased global competition, the introduction of new delivery models (such as software as a service), new technology plays (such as open source), and the rapid commoditization of technology solutions, enterprises must provide their prospects and customers with clear and convincing reasons to buy from them.

When crafting competitive advantages, the goal is to create clear, relevant, measurable and unique competitive advantages that answer the question “Why should I do business with your company and not your competitor?”

The Challenge

Most companies fail to provide real competitive advantages for one of the four following reasons:

  1. They do not have any competitive advantages, fail to acquire them over time and instead revert to more tactical comparison points or positioning statements. These companies employ the short term tactics of sales gimmickry and the power of persuasion before ultimately reverting to price as their competitive advantage, thereby (often unknowingly) relegating themselves to a commodity status. These organizations often fail to realize (until it is too late) that without a competitive advantage, price becomes your only differentiator, and unless you’re Wall-Mart, results in an unsustainable business model.

  2. They think they have competitive advantages but they really do not. These are often companies which provide vague, ambiguous or imprecise generalizations. Most of the time, if you ask different executives in the company for their competitive advantages, you will receive different responses.

  3. They mistake strengths for competitive advantages. Competitive advantages are not subjective or broadly claimed. Customers normally do not buy from technology suppliers because of Boy Scout traits. For example, while the below strengths are admirable, they are not competitive advantages:

    • Great customer service – who doesn’t claims this?
    • Quality products – while quality is a loosely defined term, what company is not going to make this claim?
    • A trusted partner – this phrase is so overused that it is not believable and can actually invoke cynicism.

    Claims of strength such as those cited above are so broad, ambiguous and unsupportive that they are often viewed as boastful and normally tuned out by buyers.

  4. They have competitive advantages but don’t consistently message them, position them or proactively leverage them (and instead revert to price and perceived relationship skills to secure new business). In this scenario, when asking 10 staff why the company should be selected, they give 10 different responses – and none of them match the CEOs response.

Failure to achieve competitive advantage over time will unquestionably fail the business. As Jack Welch quotes, “If you don’t have a competitive advantage, don’t compete.”

The Benefits

Developing at least one clear, relevant, objective and unique competitive advantage is a must for company viability. Real competitive advantages achieve several tangible benefits:

  • The company will be invited to more sale opportunities. The correct messaging received in the market place will increase in inbound lead flow as well as lower the cost per lead and increase the funnel volume.

  • Higher sales win rates. A more relevant, compelling message will differentiate your company from your competitors with demonstratable value instead of cost reduction.

  • Much higher corporate valuation which results in decreased cost of capital or an increased liquidation event. Wall Street places great emphasis on competitive advantages. When Warren Buffett was asked during a interview for the one thing to look for when investing in a company, he immediately responded “a sustainable competitive advantage.” Buffet also stated “The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.”

Competitive Advantage Minimum Criteria

Crafting competitive advantages is far more science than art. Competitive advantages must possess the first three below criteria to be real competitive advantages.

  1. Relevant -- A competitive advantage must be one of your target market’s top buy criteria. It is of little value to develop a competitive superiority in an area not highly valued by prospects and customers.

  2. Measurable -- Competitive advantages must be objective, quantifiable and provable. Subjective claims are tuned out. Only when competitive advantages can be measured and proven will prospects believe them.

  3. Unique -- Competitive advantages must be unique. Making the same claim as other suppliers provides no differentiation to the customer.

  4. Sustainable -- Sustainability adds significant value to competitive advantages. Jay Barney, author of Gaining & Sustaining Competitive Advantage, defines sustained competitive advantage as the following:

    A firm is said to have a sustained competitive advantage when it is implementing a value creating strategy not simultaneously being implemented by any current or potential competitors and when these firms are unable to duplicate the benefits of this strategy.

Two Types of Competitive Advantages

Competitive advantages can be either internal or external and most enterprises will possess some of both. Internal competitive advantages deliver economies and efficiencies which reduce costs, period cycle times and time to revenue. External advantages are key to technology suppliers and solution selling markets and focus on customer facing benefits such as an improved customer experience and increased value proposition. As technology evolves at a rapid pace, innovation is the most leveraged method to achieve external competitive advantages. Within the technology industry, external competitive advantages are vital to corporate survival.

Advice and Recommendations

Most organizations ill-define or incorrectly define their competitive advantages and then subsequently misspend marketing funds and valuable sales time. Keep the following points in mind for developing, promoting and maturing your competitive advantages.

  • Remember, ‘strengths’ are not competitive advantages. Characteristics such as quality, trust, responsiveness, reputation, image, innovation and viability are neither unique nor measurable. These overused characteristics have lost their meaning and are nothing more than the minimum to be considered and will not answer the objective question (why us?) nor close a sale.

  • Also recognize that advertising and clichés are not competitive advantages. While there is a role for (precisely worded and targeted) advertising to support campaigns and branding efforts, advertising only makes an introduction – and won’t do anything for sales unless your prospects believe in your competitive advantages.

  • As a side note, a failure for a competitive advantage to be unique may still permit ‘Competitive Positioning’. This is essentially being the first to make a claim that may not be unique – and making it loudly. This ancillary strategy can be used to leverage non-unique buyer perceived value as well as place competitors in a catch up mode and position your company as an innovation leader.

  • Don’t forget to perform competitive intelligence (CI) when developing your superiority statements. Competitive advantages are relative to your most direct competition and therefore cannot be crafted in a vacuum.

  • For organizations that subscribe to a Good to Great methodology, your competitive advantages should dovetail your hedgehog concept. Doing what you are good at will only make you a good company (acceptable to some). Focusing solely on something you do better than any other organization can make you a great company. Few companies have the discipline to discover their hedgehog concept and fewer companies have the discipline to build consistently within it. They fail to grasp a simple paradox: The more you have the discipline to stay within the three overlapping hedgehog circles, the more you will have attractive opportunities for growth. The challenge becomes not opportunity creation, but opportunity selection. It takes discipline to say "No, thank you" to big opportunities outside of your focal area. To find your hedgehog focus, you must get the right people engaged in candid dialogue and debate, confronted with the brutal facts and guided by the three overlapping questions:

    • What can you be the best in the world at?
    • What most drives your economic engine?
    • What do you have a passion for?
  • Determine how you apply R&D or other initiatives toward your competitive advantages to grow them over time. You may not now possess the competitive advantages you aspire to achieve, but they may be within striking distance.

  • You must leverage customer research to validate the relevance and match of your proposed or actual competitive advantages. The only perceptions that matter are those of your buying customers. Only prospects and customers (buyers) can determine which competitive advantages are relevant. Most organizations fail to perform the customer research needed to vet their strategies before their go to market execution. The disparity between what management and buyers believe are relevant competitive advantages results in tremendous marketing misspend and lost sale opportunities. If your competitive advantages are not the most weighted items in an RFP and decision making process, then they are not competitive advantages at all.

  • It is highly advisable to outsource external (blind) customer research. Customers often do not tell their suppliers the truth if they believe the truth hurts. Friendly customers will often skirt the truth rather than bring up uncomfortable topics. This situation can be remedied with outsourced customer research done by anonymous research professionals. Blind research has the added advantage of receiving more candid and honest answers. For example, research consistently shows that if a customer knows his responses will go to a specific vendor, price is always among the top buy criteria. However, if the customer does not know the company related to the call, price rarely makes it to the top of the list.

  • Consider hiring an outsourced research firm or contact center to perform lost sale opportunity surveys. Lost sale opportunities offer a very strong voice in determining the actual or perceived lack of competitive advantages.

  • For increased focus and synergy, your competitive advantage(s) should be integrated into your business operations so as to be pervasive throughout the lines of business and daily decision making.

  • Integrate your competitive advantages into your corporate culture. Share with all staff your results and solicit staff for their comments and suggestions. Repeat your competitive advantages at every opportunity – sales management meetings, company meetings, etc. In a positive tone, quiz staff of your competitive advantages during team meetings and offer incentives for accurate and enthusiastic responses.

  • Look to mitigate your competitive disadvantages. You may want to reach out to our customers and staff for a candid understanding of your most significant weaknesses so that you can apply remediation strategies – or quite possibly turn your weaknesses into advantages.

  • Broadcast your competitive advantages. Your competitive advantages must be messaged, communicated, heard and believed to influence sale opportunities and compliment your brand. The ultimate goal is to condition prospects and customers to instinctively associate your company with your competitive advantages. Communicating the message includes many activities.

    • The sales force must set the bar in communicating your competitive advantages. They must learn how to leverage your competitive advantages with every sales prospect and convincingly translate your competitive advantages into measurable cost savings and ROI.

    • Every employee sells your business in some way and therefore must be able to articulate your competitive advantages. Random staff quizzing supported by positive reinforcement will stimulate a corporate wide effect.

    • Narrow and precisely targeted advertising of a key message may be cost effective in broadcasting your message. Advertising in general is expensive and fleeting, however, analysis and thoughtful planning are necessary to further investigate this option.

    • Simple collateral updates should be made on your website, brochures, fax cover page, business cards, invoices, customer statements and purchase orders. Also consider updating the on-hold telephone message.

    • Competitive advantages supported by a tag line or slogan become more memorable and often crystallize the message for the recipient.

  • Measure and refine. Success will be achieved when customers (and influencers or analysts) cite your competitive advantages as the reason they purchased your solution. In addition to winning new customers, those customers who cite and identify your competitive advantages are far more likely to stay with your company than otherwise. To that end, your competitive advantages must be recommunicated to customers periodically.

Technorati: Technology Media, CRM, Sales  Technorati Add to Technorati Favorites Technology Media, CRM, Sales Save this page to
Posted In:   IT Strategy  PermalinkPermalink  CommentsComments (0) TrackbackTrackback (0)


Trackback URL for this blog post:



Send comments to blog[at]

Home Blog Home













Services | Methods | Markets | Brands | Company | Media | Blog

Home | Search | Sitemap | Directory | Resources | Links | Terms | Contact | Privacy | 508 | Disclosure