How are you doing? Is your business doing great?
I hope so.
I’m glad that we got several requests to continue my series on Competitive Advantage.
In my last article, we discussed Cost Leadership as the first way to gain a competitive advantage. Today, we will talk about the second way:
Differentiation means having a product or service that provides better benefits. Because of this, a business can charge more.
This results in a higher profit margin.
Businesses can achieve differentiation through the following:
Quality means having high-quality products.
For example, Ferrari produces very high-quality cars. It does not produce ordinary streetcars. By doing so, it is able to charge higher.
Customer service means delighting our customers by serving them well.
Banco de Oro was able to increase its clients because it extended its banking hours. It also began operating on weekends.
Innovation means meeting customers’ needs in a new way.
The iPod was innovative because its users can play music in any order. And its new design was easier for the customers to handle. It soon became the best-selling music player.
Offering better quality, better customer service, and/or innovation will allow businesses to grow.
Which of these options for differentiation have you applied in your business?
Feel free to share your thoughts, experiences, and ideas!
Do you want to learn the 3rd strategy to develop a competitive advantage?
Type “Yes!” in the comments down below and I’ll tell you about it in my next blog.
Looking forward to hearing from you!
P.S. If you want to understand more about your business growth stages and still do not have the Grow Your Business, Pinoy! book yet, get your copy here. If you or any of your friends would want to know what stage your businesses are in, feel free to take the assessment here.
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