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There is no one way to measure competitive advantage. In fact, competitive advantage consists of multiple factors. However, it’s important that companies have at least one clear advantage if they want to successfully compete amongst their competitors.  

What Is Competitive Advantage?

Competitive advantage is the condition that makes a business more successful than the business it is competing with, or a particular thing that will make it more successful.  A business that has a strategic plan to increase its competitive advantage could see more successes than a business that has no plan. 

Why Having a Competitive Edge is Important

A company can’t be successful without spending time acquiring the resources they need to get ahead of their competition. When a business is familiar with its products and services, their customers' wants and needs, and is able to monitor their competition, they have more opportunities to find areas for growth and improvement. Not being aware of what a business has to offer can negatively impact their operations. 

Knowing What Your Company Has to Offer

The way a company gathers information and reciprocates it back into the business can help develop their opportunities for success. Knowing what the company has to offer goes beyond product awareness; it consists of knowledge of the entirety of the business in general. Other questions to keep in mind when thinking about what the company has to offer are “Why did the company begin in the first place?” or “Why do they sell/offer as products or services?” There are different sources to help answer any questions in regards to what a company has to offer. Existing forms of knowledge for a growing business include:

• The experience of other employees;

• The designs and processes for the goods and services; 

• Document files;

• And plans for future activities. Where is the company going? What are they going to do to get there?

Defining Your Target Market

A target market is a certain group of customers at which goods and services are aimed. A company’s target market is rarely “everyone.” Their goal is to define a target market by narrowing down their niche, ultimately narrowing down their audience. A company finds its perfect target market by conducting audience research. Here are helpful tips in conducting audience research so a company can better define their target market: 

• Compile data on current customers;

• Look into websites and social media analytics;

• Be clear about the value of your products and services; 

• Create a target market statement;

• Revisit audience research as needed. 

Keeping An Eye on Your Competitors

Understanding what is going on outside of your business is an important strategy when it comes to being successful. Be aware of the competition, both local and nationwide. Is there a company that has the same products and services as you? Knowing what they’re doing at essentially all times may sound tedious, however, it is beneficial for your sales plans. Keeping an eye on your competition can:

• Help understand your advantages and disadvantages in relation to others in the market;

• Give a better idea as to what the competitors current and future plans are;

• Provide information to develop strategies that could create a competitive advantage in the future;

• Help to predict how competitors may respond to a new product release. 

Competitive Advantage Strategies

The way a company decides to implement different competitive advantage strategies may vary depending on what their end goal is. Here are a few ideas to keep in mind when coming up with a strategic plan that works best for your company. 

Understand Your Customers

In order to get a better understanding of customers, a company should place themselves in their shoes. What sales trends are being noticed? Business leaders and teams can benefit from reading sales reports to get a better understanding of the different service trends that are doing well. To communicate the information thoroughly to the rest of their employees, they can order sales books to help them get a visual of the different reports. Think about the demographics of repeat customers. Does this have anything to do with the success of the company? Are they who you’d think your target market consisted of?

Know Your Competitors

Aside from purchasing books on entrepreneurialism and startups to help build knowledge of competition strategies within a business, a business leader can teach their employees to know their competitor hands on. In order to be the best at anything, you have to be familiar with who you’re going up against. This is especially significant for companies who are trying to be the best in their field. Usually, when a business has competition, it’s because their competitor excels at what they’re trying to accomplish, not because they aren’t doing well. Being aware of the competition is a vital step in running a successful business that many companies, unfortunately, look past. 

It’s uncommon to hear of a business not having a presence on the internet. They’re almost guaranteed to have their own website and some even have a social media page. Take the time during the day to Google the competition, analyze what they’re doing well. Do they have aspects of their website that you don’t? How are they the same? What aren’t they doing well, that you are? Do they have any customer reviews? What do they say?

Keep Up With Industry Trends

A business owner may find it beneficial to invest in their team and order finance and economic resource books to better help them understand the different money and business trends. When a company stays up to date with industry trends, they can prevent themselves from looking out-of-date. Being prepared for the current demands can promote both foot traffic and e-commerce and help guarantee that customers will get what they’re looking for. 

Read What The Business Leaders Are Reading

There is a reason why self-help books continue to see success. CEOs benefit in a variety of ways from staying engaged with new ways to learn. Researching what other business leaders are reading in order to be successful can be a helpful resource for all companies. A business leader may also want to order career advice books and resources for their team, written by other industry leaders. 

Educate Your Employees

Business owners who maintain constant education throughout their company are ensuring that their employees are up to date on different trends, policies, or any other training that may be important for the entire company to know. It’s important to educate employees, no matter how long they’ve been there, because most industries are constantly evolving. Some of the benefits of continuing employee education include:

• Improved employee performance, satisfaction, and morale;

• Addresses workplace weaknesses and how to improve;

• Keeps the consistency throughout the company;

• Increases productivity;

• Promotes idea building and strategizing;

• Reduces employee turnover;

• Increases company reputation. 

Managers might want to educate their team with various educational resources, which would include providing them with business books of any and all subjects. 

Leverage Technology

Technology is always evolving, and it may play a major part in the success of a business. Incorporating technology that analyzes data within a company can help lead to better decision making. When businesses turn to technology, they can create efficient ways to improve their business overall, which could ultimately lead to an improved competitive advantage.