How Businesses Build Competitive Strategies

Building a competitive strategy is about how companies outperform their competitors in generating profits by satisfying the same consumer needs and wants.

There are many businesses around us. Some target the same market. They compete directly in satisfying consumer needs and wants. And, their products replace each other. So, when consumers do not like the product of a company, they will switch to a competitor’s product.

Now, let’s say, you are running a business.

Being successful in the market requires an effective competitive strategy to win the competition. When successful, your company generates above-average profitability by gaining a competitive advantage.

However, due to dynamic competition and market demand, competitive advantage may last only temporary. Competitors may develop superior competitive strategies and eventually outperform your company.

For this reason, your company should adapt the strategy. Thus, it remains relevant and effective in dealing with the changing business environment. And, if your company is able to maintain a superior position over time, that is what we call sustainable competitive advantage.

How does your business successfully compete and gain a competitive advantage? Michael Porter provides a basic framework, known as generic strategy. It tells us how companies compete, in what dimensions.

Then, your …

Strategies in Targeting Target Markets

Another thing that is no less important about the target market is determining the strategy. In general, there are at least four market targeting strategies that are usually carried out by business people, namely:

Mass Marketing

As the name implies, business people use mass marketing strategies to target everyone in marketing their products. Yes, this strategy does not really apply segmentation in determining its customers. The reason is because the products offered are a general need and are needed by everyone.

Examples of products that can be marketed with this strategy are soap, toothbrushes, and others. In implementing this strategy, the focus of business people is more on how to get more people to know the products that are being sold. That way, the potential for consumers to come and buy merchandise will be higher.

Differentiated Marketing

Even more conical, differentiated marketing is a strategy to target a more specific target market. For example, if you previously sold common soap products, you can now differentiate between men’s and women’s soaps.

Niche Marketing

Continue to a smaller and more specific target market strategy, namely using niche marketing. An example of a product that can use this strategy is the sale of …