Introduction
Competition is one of the main challenges that any business entity in the current society has to deal with in order to achieve success. The presence of many players in the same industry forces firms to find ways in which they can gain competitive edge over their market rivals in order to protect, or even expand the market share. This is very common in industries where it is not easy to differentiate the products from that of competitors.
The emerging technologies, especially in the fields of transport and communication have reduced the world into a small global market. It is now possible for an Australian firm to have its production plants in Taiwan and sell the products in the global market. This has resulted into an increased competition as firms struggle to capture the global market as a way of expanding their market share. Having a competitive business strategy is critical in gaining a competitive advantage in the current market.
It allows a firm to act differently from others in the market, the fact that may help it attract a pool of loyal customers. As Dugal (2005) notes, customers always prefer firms that offer them unique experiences whenever they purchase their products. They prefer firms that offer them superior value. In this research paper, the focus will be to determine effective business competitive strategies that a firm can use to gain an advantage over its market rivals.
Competitive Strategies
According to Douglas and Rhee (2009), the business environment in the current society has changed drastically from what it used to be in the previous years. Before the First World War, the main manufacturing companies were located in Europe. The global society had to rely on these European firms for most of the manufactured products. With such a massive market, these companies only had to focus on their production capacities.
The market had to accept what was presented to them because of lack of other options. However, this is no longer the case. Competition has become so stiff that even these giant European firms are struggling to survive. Customers have become so demanding because they have options whenever they want to purchase an item.
It means that for a firm to gain a competitive edge over its market rivals, it must be in a position to understand the needs of its clients and meet them in a unique way that will make them satisfied with the products. The following are some of the strategies that a firm can use to gain a competitive edge in the market
Dutta and King (2008) say that it is important for a business entity to focus on the customer care when it is difficult to differentiate the product from that of competitors. Sometimes it may not be possible to differentiate one’s products from that of the competitors, such as in the transport sector.
In such cases, the best way of gaining a competitive edge is to offer quality customer-care services. This may involve maintaining a close communication with clients, and addressing any issue that may be of concern to them in a timely and satisfactory manner. This will make them feel valued by the firm.
Sometimes it may be necessary to find a way of offering products that competitors do not have in their portfolio. According to Bresser (2007), it may be difficult to identify the gap in the market, but this is the best way of moving away from stiff competition in the market. This scholar says that sometimes a firm may need to create the gap in the market.
This can possibly be done by modifying a common product to offer a superior value from that of the competitors in the market. The superior value offered by such modified products will give it an edge over its market rivals. It will offer it an opportunity to meet the needs of the customers in a unique manner.
Gaining a competitive edge in the market may sometimes involve a firm identifying what it has the capacity to do in the best way possible. Many business entities have failed in the market trying to do everything within a given industry. This forces a firm to spread its resources thinly to all these areas that needs its attention.
The result of such moves is a stream of a poorly conducted process that delivers substandard products. A firm should try to find a small niche of customers in the market that it has the capacity of meeting their needs in a special way. It should then focus on offering unique products with a higher value as compared to what other competitors offer in the market.
Nayyar (2003) advises that a firm should make an effort to ensure that it remains active in the market. It is necessary to maintain a close relationship with clients, especially when dealing with organizational buyers. Being active in the community may involve engaging the clients through various forms of communication such as the social media, e-mails, or even phone calls.
The marketing unit may also take the initiative of reaching out to the customers directly through common forums in order to create a bond. When such bonds are developed, it is easier to maintain the organizational buyers as loyal customers. The focus of this strategy is to develop a community. It involves making the clients feel that they are members of this organization other than being simply customers.
In the current society, advertising is seen as an unavoidable strategy that businesses must use in order to maintain a pool of loyal customers. Many multinational corporations spend a lot of money in advertising and other related services as a way of promoting their brands or specific products in the market.
However, Hecht (2002) says that one of the best ways of reaching out to the right clients is through building an army of evangelists. People can easily ignore advertisements. However, a referral made by a friend always has a strong bearing when one is planning to make a purchase. It is important to find a way of meeting the needs of the current clients in a unique way so that they can become the firm’s evangelists.
The referrals they make will be worth a lot as a firm struggles to gain a competitive edge in the market. This strategy is very appropriate for small firms that may not afford lavish spending in the advertisements.
The only effort that such a firm will need to make is to offer value beyond the expectations of the clients so that they get thrilled with the products. This way, they will find themselves talking about the product and its uniqueness to their friends in their social forums, especially when they are asked to give an advice when a friend is looking for the same product.
It may be necessary to develop a loyalty program as a way of maintaining a pool of loyal customers. When a firm is offering products that are easily available at the stores of the competing firms, the best way of gaining a competitive edge may be to create a program that seeks to reward the clients for their loyalty.
This program may take different approaches depending on the size of the firm or the nature of products it offers. The management may randomly pick customers who regularly visit their stores and reward them for their loyalty. The company may also develop loyalty cards where clients are given points whenever they purchase a product from the company. The points can then be redeemed for gifts as a way of appreciating them.
Conclusion
Maintaining a pool of loyal customers is one of the most challenging tasks that firms are faced with in the market. However, this is the best way that they can use in order to manage the stiff competition in the market. Developing competitive business strategies start by understanding the nature of industry and the type of clients that a given firm targets.
It is clear from the above discussion that one of the best ways of gaining a competitive advantage is by selecting a niche in the market that one can satisfy its needs. The firm should then employ a series of strategies that are not only meant to offer maximum satisfaction, but also to make the clients feel that they are part of the organization.
References
Bresser, R. (2007). Matching Collective and Competitive Strategies. Strategic Management Journal, 9(4), 375-385.
Douglas, S. & Rhee, D. (2009). Examining Generic Competitive Strategy Types in U.S. and European. Journal of International Business Studies, 20(3), 437-463.
Dugal, S. (2005). Strategic Positioning for Market Entry in Different Technological Environments. Journal of Marketing Theory and Practice, 3(3), 31-45.
Dutta, B. & King, W. (2008). Metagame Analysis of Competitive Strategy. Strategic Management Journal, 1(4), 357-370.
Hecht, J. (2002). Competitive Business Strategy for Teaching Hospitals. The Journal of Risk and Insurance, 69(4), 615-618.
Nayyar, P. (2003). On the Measurement of Competitive Strategy: Evidence from a Large Multiproduct U.S. Firm. The Academy of Management Journal, 39(7), 1652-1669.