There are many forms in which a company can accomplish competitive advantage over its rivals. Some of the most reliable are definition of the market, niche dominance, market share, and governmental protection.
Wal-Mart has accomplished competitive advantage over its rival by defining the market. If we look at this company we can clearly see that they have acquired their competitive advantage based on their "always low prices" strategy. By offering this great deal to customers they had set their market in an efficient way. Wal-Mart not only offers low prices but good quality gaining competitive advantage over K-mart. I think the strongest strategy that they have adapted to gain competitive advantage is their inventory system; JUST IN TIME inventory. This is the strategy that has lead them to be the most successful company in the low price range of hypermarkets segment.
Then we have credit card companies such as Discover and American Express that have acquired competitive advantage based on the benefit that they offer their users by giving frequent flyer miles by dollar amount expenditure. We can clearly see that this great benefit has positioned them as companies that not only offer great service but on top of this they provide this extra gain.
We also have production companies on the TV industry that have competitive advantage over news, and soap operas with their mini series shows. HBO is a clear example of the competitive advantage that dominates the market and they also obtain a high sales and market share because they call the attention of viewers.
And finally we have pharmaceutical companies such as Pfizer that has competitive advantage over Johnson & Johnson. Based on for their recognizable patents they exercise the back of governmental protection because they help society. This competitive advantage has many advantages over a long period of time this is why it is very important for a company to position their market with quality, benefit, and cost. Pfizer offers all of these qualities in all the products that they offer and on top of these characteristics have the protention of governmental agencies.
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4 comments:
Definitely hard to compete with Walmart there. They're just way too entrenched and they bully suppliers to boot!
Though, I don't know if Discover and American Express can keep their advantage. They do provide some really great benefits. (American Express Titanium anyone?) But a lot of other companies do the same. I don't know too much regarding Discover's program but I know the usual AMEX cards don't allow you to carry a balance unless you're using AMEX Blue. So that could be a drawback for them.
Pharmaceutical companies are worldwide. U.S firms face competition from all over the globe. Many other countries protect their pharmaceutical industry by imposing government regulations, which makes it harder for outside firms to sell their product. In Thailand, for example, U.S companies are warring in court with the Thai government because the government wants to allow generic drugs to be produced, disregarding the patent protection allowed by the WTO. But the Thai's say they are in an emergency crisis (AIDS), and need these drugs to help their population. These firms face threats(?) from everywhere. Im my opinion, this is a threat to their profit margins, not necessarily the existence of the business.
I agree that HBO does great and I can see it having a huge market share. You ve mentioned that they call the attention of the viewers. Can you just go a little bit further into details and talk about the ways in which they accomplish it.
I think Wakmart does not only lower their operating cost by JIT inventory system buy as well giving low salary wages to its employee as well.
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