SOURCES OF COMPETITIVE ADVANTAGE
Introduction
For a business to succeed, it must understand its competitors and their nature of operations. Competitors are other businesses that deal with the same products or substitute products. No matter the products and services a business offers, it will always encounter competition. They are two types of competitors, direct and indirect competitors. Direct competitors deal in the same goods while indirect competitors operate in the same marketplace but offer different products. A business should identify its competitive advantages for it to survive in the market. Notably, competitors tend to copy what your business is doing, therefore being always one step ahead of them is crucial. A company should understand their competitors’ products, distribution channel, customer groups, and market strategies. Businesses should focus on the following things to understand its competitor:
The products and services offered by the competitors.
It is vital to understand the products and the services that your competitors provide to their customers. This will help you understand the nature of the competitors, whether they are direct or indirect competitors. Web data integration can help a business in getting information about the products of their customers. Web integration data refers to the process of managing data from different websites or sources into one comprehensive database. Therefore through the data integration techniques, a business can know and understand the products of their competitors. Consequently, it can come up with better and quality goods and services than those of their competitors.
The prices charged on their goods and services.
Understanding the prices of the competitors will help a business to set their prices. Therefore, when making pricing decisions, a business can employ the following pricing methods.
Above competition pricing: This is setting prices higher than those of the competitors.
Parity pricing: Setting prices at the same level with your competitors.
Below pricing: Setting prices lower than those of the competitors.
Marketing strategies
A business can use web data integration to study and analyze the marketing activities of its competitors. This can be achieved by integrating information from the web applications and sites of the competitors into one workflow. The marketing mix of the competitors determines their strategies of reaching their customers. Understanding the marketing plan of the competitors offers a competitive advantage to the business.
Annual reports
A business can obtain published financial statements of its competitors, especially for a public company. This can help a business understand the financial performance of its competitors. A business can compile all this information into a homogenous collection through web data integration techniques. Understanding the performance of the competitors is vital for comparison purposes.
Information Technology
Understanding how the competitor has integrated IT in its operations is essential for a business. A business should understand how its competitors have used IT to make their operations more efficient. For instance, the use of emails and websites. For a business to succeed, it should be more innovative than its competitors. Embracing modern technology helps promote innovation in business.
Conclusion
It is vital for a business to monitor how their competitors do business. Focusing on these five things can help a business analyze its competitors. The management of a business should also be keen to act on the information obtained about their competitors. The quick action on the information offers the business a competitive edge.