Creating Sustainable Competitive Advantage

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Creating Sustainable Competitive Advantage
class
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Using organizational resources to create
sustainable competitive advantage

• Organizational culture
• Marketing assets
• Marketing capabilities

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Figure 11.1 Advantage-creating resources
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Figure 11.2 Resource imitability ladder Source
Adapted from Collis and Montgomery (1997)
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Figure 11.3 Generic routes to competitive
advantage creation
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Cost Drivers
Scale
Institutional
Experience
Capacity Utilisation
Location
COSTS
Policy choices
Linkages
Inter-relationships
Timing
Integration
Source based on Porter (1985)
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Figure 11.5 Uniqueness drivers
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Figure 11.6 Levels of product/service offering
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Levels of product/service offering

• Differentiating the core and expected product

• Differentiation of the core product or benefit
  offers a different way of satisfying the same
  basic want or need

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Levels of product/service offering

• Augmenting the product

• Differentiation of the augmented product can be
  achieved by offering more to customers on
  existing features

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Levels of product/service offering

• Quality

• A prime factor in differentiating the product or
  service from that of competitors is quality

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Levels of product/service offering

• Packaging

• Packaging Store
• Packaging Protects
• Packaging Facilitates use
• Packaging helps create an image
• Packaging helps promote

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Levels of product/service offering

• Branding

• A particular effective way of differentiating at
  the tangible product level is to create a unique
  brand with a favorable image and reputation

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Levels of product/service offering

• Service

• Service can be a major differentiating factor in
  the purchase of many products, especially durable

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Figure 11.7 Product/service differentiation
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Figure 11.8 Alternative emphases for
differentiation
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Figure 19.1 Pressures on marketing
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Figure 19.2 Increasing customer demands
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Figure 19.3 Fundamentals of strategy in a
changing world
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Figure 19.4 Basic positioning options
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Figure 19.5 Low-price positioning
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Figure 19.6 Premium-quality positioning
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Figure 19.7 Innovation positioning
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Figure 19.8 Superior-service positioning
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Figure 19.9 Differentiated positioning
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Figure 19.10 Customised positioning
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Offensive and defensive competitive strategies
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Build Strategies

• A build strategy seeks to improve on
  organizational performance through expansion of
  activities

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Strategies

• Expand the total market by
• Finding new users
• Creating new uses, and
• Encouraging more usage
• Protect its current market share by
• Adopting defense strategies Increase its market
  share
• Note the relationship between market share and
  profitability

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Expanding the Total Market
New customers
More usage
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Expanding the Total Market

• New Customer
• Buyers who are unaware of product
• Buyer who are resisting because of price, lack of
  certain features.

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Expanding the Total Market

• Search new user among three groups
• Market penetration strategy
• New market segment strategy
• Geographical expansion strategy

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Expanding the Total Market

• More Usage
• Increasing the level or quantity of consumption
• Increasing the frequency of consumption

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Expanding the Total Market

• The amount of consumption can increased by
• Package
• Product design
• Additional opportunities to use the brand in the
  same basic way
• Identifying completely new
• Provide consumer with better information
• When the product was first used or would need to
  be replaced
• The current level of product performance

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Figure 11.9 Market challenger strategies
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Figure 11.10 Frontal attack
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Figure 11.11 Flanking attack
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Figure 11.12 Encirclement attack
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Figure 11.13 Bypass strategy
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Figure 11.14 Guerrilla tactics
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Figure 11.15 Defensive strategies
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Figure 11.16 Position defence
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Figure 11.17 Flanking defence
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Figure 11.18 Pre-emptive strike
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Figure 11.19 Mobile defence
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Figure 11.20 Contraction (focus) defence
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Figure 11.21 Niche strategies
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Figure 11.22 Harvesting strategies
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Figure 11.23 Divestment strategies